Procurement for Engineered Products
1. Procurement Organization & Capabilities
With the increasing importance of procurement as a major element of a successful project execution, TME in coordination with its worldwide structure of affiliated companies in North America, Europe and Asia has a vast local and international procurement network to encompass the entire range of requirements and to cover sourcing, purchasing, expediting, inspection and traffic activities.
Thus, the procurement of the products used in large infrastructure construction projects has become increasingly complex and this is just one of the areas where TME excels. As data available in the procurement process is scarce, we have had to develop our own procedures and standards in order to ensure this part of the project is carried out with meticulous attention to detail as the lack of one crucial part can stop or slow down a project indefinitely.
The Procurement/Commercial Department makes use of established procedures that govern sourcing, negotiation, approval, order and contract processing, expediting, transportation, legalized documents and custom clearance, insurance, inspection, testing, quality control, material coding, coordination, reporting, safety and security. The high volume of purchases puts TME in a unique position to obtain the most competitive prices and best delivery.
The Procurement/Commercial Department also maintains a close relationship material stockists to cater for urgent and challenging project requirements.
TME has a team of Senior Engineers, Market Researchers, and Commercial experts who are dedicated to keep abreast of new technologies and developments and to select the best proven products. Their objective is to satisfy TME clients and deliver high quality material. Their expertise and experience enable TME to provide alternatives to meet special projects requirements.
The major activities covered by the Procurement/Commercial Department are as follows:
- Market survey
- Foreign and Local purchasing
- Expediting, coordination and follow-up
- Commercial activities
- Material handling and storage
2 – Procurement Procedures
- Preparation of Vendor lists
- Preparation of Tender packages (take-off and specifications are provided by Engineering) priority is given to long-lead items
- Follow-up/expedite offer
- Evaluate offers – Technically and Commercially
- Coordinate with Engineering, Planning and Cost Control for selection of successful bidder
- Obtain approval of the selected Bidder (as stipulated in the project contract)
- Release the order
- Arrange payment formalities (Advance Payment, L/C’s, etc.)and receive performance bonds from suppliers, as applicable
- Assign freight forwarder
- Arrange Insurance coverage (Marine Insurance, etc.) and coordinate with the Vendor(s) for details of delivery
- Assign clearing Agent for port/custom formalities and Local Transportation to main stores or site store as applicable.
3 – Expediting
In order to meet the set target dates for equipment/materials delivery to the project, the customized and computerized follow-up system is essential for monitoring all stages of the procurement process as follows:
- Prepare Supply Request Form (SRF)
- Request for quotation
- Receipt of quotations / Comparison Sheets (Bid Tabulation Forms)
- Purchase contracts prepared
- Delivery dates determined and monitors
- Shipment and shipment tracking
- Receipt of clearing documents / Clearing
- Transportation to site
- Process payment
Per the TME standard purchase contract, the supplier is required to present progress reports, on regular basis, covering the milestones for engineering design, manufacturing, testing, ex-factory delivery and shipping schedule. Occasionally, factory visits by the TME representatives to the factory is conducted to ensure the correctness of the progress reports. This allows the Procurement Department to take quick corrective steps should there be anticipated schedule deviations.
4 – Inspection & Materials Control
The mechanism of material control is detailed hereunder:
- The Engineering Department prepares the take-off of bulk materials based on “Issued for Construction” drawings and issue the Supply Request Forms to the Procurement Department. Priorities are defined in accordance with the construction schedule.
- The Supply Request Forms (SRF) are updated in accordance with revisions, modifications in shop drawings and / or variation orders.
- The Procurement/Commercial Department purchases the requested materials.
- The materials remains under the control of the Procurement/Commercial Department until it is withdrawn from site stores for installation.
- The materials are withdrawing from stores for installation against requests signed by the authorized engineer.
- Monthly stock reports are issued by the Project Procurement Engineer.
- The Project Quantity Surveyor issues reports correlating the materials withdrawn with the actual work progress and the stock materials with the works to be completed.
Upon receipt of goods from suppliers, a thorough inspection is performed by the storekeeper to ensure conformity with the terms of the purchase contract agreement and the Supply Request Form.
We realize that any lack in this area of non-compliant products or inferior quality products can result in major safety issues on the job or in the future operations of the facility. It is therefore vital that we are confident that any products procured meet our rigid standards and of an acceptable level and are fit for the purposes for which they are intended.