Project Procurement is a process of acquiring goods and services necessary to a project from external suppliers. This process aims to provide the project with all necessary procurement items (goods and services) by establishing and administering contractual relationships with external suppliers and vendors.
Usually the procurement process begins when a project is approved for implementation, so project goals are set and deliverables are defined. Generally, it includes the following steps:
- Purchase planning – identifying what products or services to acquire
- Specifications development – creating written descriptions of product features and functions
- Vendor research & selection – searching for suppliers and establishing contractual relationships
- Value analysis – examining each procurement item to calculate its total cost of delivery, maintenance and usage
- Financing – allocating necessary funds and addressing payment issues
- Making the purchase – obtaining procurement items and managing delivery
- Contract administration – handling contracts and monitoring contractual relationships to ensure the parties meet each other's expectations
- Inventory control and stocking – ensuring that all purchased items are in stock and available for use in the project.