May 6, 2013
Errors in procurements can cost owners financially, delay projects, and dissuade suppliers from tendering or bidding with them again.
Elliot Smith, an associate with Osler’s Commercial Practice group, wrote an article for PurchasingB2B magazine overviewing two of the most common mistakes made with procurements and how to avoid them.
The first mistake, says Elliot, is mixing up binding tenders and non-binding requests for proposals (RFPs). The next most common mistake is violating the terms of Contract A.
“Before starting a procurement process, an owner should ask if it’s looking for binding bids or non-binding proposals. Once this is decided, it’s not enough to title the procurement a tender or RFP. The terminology throughout the document and the owner’s rights and obligations in the process should be consistent with the type of process selected. This consistency increases the likelihood that once the process starts, all parties will have the same expectations,” writes Elliot.
Elliot notes that, “When there is no Contract A, the owner has much broader—but not unlimited—discretion in how to proceed. There’s still a duty to consider proposals fairly, so even though the owner isn’t bound by Contract A, there are still limits on what the owner can do.”
Read Elliot Smith’s full article “Procurement mistakes: Tips for avoiding two of the most common procurement pitfalls” in PurchasingB2B magazine, May 6, 2013.