- Competitive Buying
– Purchasing Services is required to take mandated
purchasing action and retain corresponding documentation
according to the following guidelines:
$0–9,999: Competition is not
required if prices from the suggested source are known
to be both fair and reasonable. However, bidding may
be utilized when Purchasing Services has a basis to
believe that a better price can be obtained by the
use of competition.
$10,000–24,999: Evidence of
competitive pricing must be documented. This can be
accomplished by Purchasing Services through formal
bidding, electronically submitted fax bids, phone
pricing, comparison to or use of existing contracts
and cooperative buying organizations, comparison to
or use of volume purchase agreements, use of previous
formal competitive quotations, or other means to ensure
competitive pricing.
$25,000–up: Requires a formal
bidding, online bidding (reverse auctions), negotiation
process, or use of an existing contract or approved
cooperative buying agreement.
ALL QUOTATIONS OR OTHER MEANS TO ENSURE COMPETITIVE
PRICING MUST BE OBTAINED BY PURCHASING SERVICES.
- Noncompetitive Buying
$10,000–up: Should a requisitioner
determine that a specific manufacturer or brand of
product is required, a written justification is required
which documents the reasons why competition is or
should be restricted. The Single/Sole
Source Justification form must be used and is
available electronically in IBIS as part of the REQR.
An online Single/Sole Source Justification form is
also available at https://abs.psu.edu/SSJ.
The preparer must reference the IBIS requisition number
when preparing and submitting the online form. After
a careful review by Purchasing Services with the department
or ultimate user, a decision will be rendered as to
the advisability of making a noncompetitive purchase.
The request for a single source item or a specific
brand of product does not necessarily eliminate competitive
requirements, and the supplier and method of award
will be ultimately determined by Purchasing Services.
Through documentation, Purchasing Services must show
that even sole sourced items have been purchased based
on price reasonableness.
In the absence of bidding, various methods are utilized
by Purchasing Services to gain assurance of reasonable
prices such as price comparisons with similar products,
price lists or catalogs, or supplier contract price
lists. In addition to the previous methods, Purchasing
Services may also request a statement from the supplier
certifying that “No better price is offered
to other customers.”
- Justifying Fairness and Reasonableness
of Price
When undertaking and completing purchase of goods
or services, it is no longer required to document
the basis of a noncompetitive (sole source) purchase
where the purchase price does not exceed $10,000 exclusive
of shipping or transportation costs, if separately
priced. While documentation of the basis for a noncompetitive
purchase is no longer required, purchasing agents
should generate such documentation if, on an “as
needed” basis, the buyer or purchasing agent
deems it to be warranted or needed by reason of unusual
circumstances or other such reasons. The foregoing
does not remove the requirement to ensure and adequately
document that the price to be paid by the University
is both fair and reasonable. The fairness and reasonableness
of a price may be affirmed by the purchasing agent
affixing his or her signature to the purchase order.
- Revealing of Competitive Bids
It is the general policy of Purchasing Services to
reveal the name of the successful bidder and the price
quoted. However, prices submitted by unsuccessful
bidders are not disclosed.
It is also the general policy of Purchasing Services
to place the order with the supplier submitting the
lowest and best quotation. The University reserves
the right to reject any or all bids received and,
as a result, on rare occasions, the low bidder may
not be accepted in view of the stringent requirements
and performance of the materials or service requested.
|
