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Policy and Procedures Manual for Purchasing and Materials Management

Procedures

Written Quotations Policy No.: PP-080
Supercedes No.:  
Effective Date: January 23, 2007 Page No.: 1 of 1

I.     PURPOSE

To provide detailed instructions for soliciting and completing a written quotation (Request for Quotation) for goods and/or services.

II.    SCOPE

This procedure applies to purchases less than $10,000 but greater than $4,000.

III.   GENERAL

When the Purchasing Division solicits quotes for goods and/or services that are expected to cost less than $10,000, several weeks could be required to complete the procurement cycle. To provide an option that speeds up the process, the written quotation procedure is available to all departments. Use of this procedure can significantly decrease procurement time for goods and services under $10,000 but greater than $4,000.

Purchases between $4,001 and $10,000 require competitive pricing. This may be accomplished by written quotations (Request for Quotation) solicited by fax from no less than three firms with written confirmation from each vendor. Written confirmation and evidence of acceptable insurance coverage also must be obtained for construction/repair-related purchases. Purchasing may request a formal bid solicited for purchases over $5,000 which require complex specifications or when the service is considered to create a high-risk exposure to the Town.

IV.   WRITTEN QUOTATION FORM

  1. Steps In Preparing Form Before Solicitation

    A sample Request for Quotation form for duplicating can be found within this manual in Division 8, Sample Forms (F), Item #F0040. The following required instructions need to be properly completed for ratification of the quoting process by Purchasing when the purchase order audit is performed.

    The following information is required before faxing a Request for Quotation form to a vendor for solicitation for goods and/or services. The Entry Letters refer to the identified section of the sample form following this section.
    1. NUMBER – Quotation number used by the department for tracking and identification purposes.
    2. DATE – The date of the Request for Quotation solicitation.
    3. DELIVERY REQUIRED – A specific date should be entered informing the vendor of the required delivery of the goods and/or services.
    4. REPLY NO LATER THAN – A time and date shall be entered within this area notifying each prospective vendor that the quotation must be returned by this time and on this specific date. The recommended time range for this type of solicitation is usually three (3) to (5) business days.
    5. REQUISITION NO. - The department will enter the requisition number as it appears on the authorized Town Purchase Requisition.
    6. DEPARTMENT – Enter the name of the department soliciting the quote.
    7. JOB NO. - Enter the job number of the project for which quote will pertain to. This area is optional depending on the department work flow tracking system.
    8. VENDOR – All information regarding the vendor should be entered in this area. At least three (3) vendors should be listed. Include the following as a minimum for vendor information: Firm Name, Phone Number, Fax Number and Contact Person for which fax should be delivered to.
    9. TERMS – Vendor shall complete this area as directed within the Fax Instruction Cover Sheet. A sample Fax Instruction Cover Sheet for duplicating can be found within this manual in Division 8, Sample Forms (F), Item #F0050.
    10. F.O.B. - Enter in this area “Town of Collierville” OR “Destination”. (The vendor pays for all freight up to the point of delivery.) If another delivery term is quoted, be sure that you understand the term offered in transit (see the freight section of this manual).
    11. SHIPMENT VIA – Vendor shall complete this area as directed within the Fax Instruction Cover Sheet.
    12. DATE SHIPMENT CAN BE MADE – Vendor shall complete this areas as directed within the Fax Instruction Cover Sheet.
    13. ITEM – Enter a number for each item described. This allows specific identification during vendor clarification and/or questions via phone or fax. It also assists in identifying the proper item when evaluating the vendor's response (quote).
    14. QUANTITY – The department will identify their needs as to the quantity required for each described item.
    15. SPECIFICATION or SCOPE OF SERVICES – A complete description should be entered in this area for each required item. The description should describe the goods and/or services to the best of the department's ability.
       If the quote is being solicited for services to be performed (including construction services) a detailed scope of services must be written and it must accompany the quotation form.
    16. UNIT PRICE – Vendor shall complete this area as directed within the Fax Instruction Cover Sheet.
    17. AMOUNT – Vendor shall complete this area as directed within the Fax Instruction Cover Sheet.
    18. COMPANY NAME – Vendor shall complete this area as directed within the Fax Instruction Cover Sheet.
    19. CONTACT PERSON – Vendor shall complete this area as directed within the Fax Instruction Cover Sheet.
    20. PHONE NO. - Vendor shall complete this area as directed within the Fax Instruction Cover Sheet.
    21. SIGNATURE – Vendor shall complete this area as directed within the Fax Instruction Cover Sheet. The quote cannot be accepted unless an authorized agent of the company signs the Request for Quotation form.
    22. DATE – Vendor shall complete this area as directed within the Fax Instruction Cover Sheet.
  1. Instructions for Soliciting Quotes

    The most cost effective way to solicit a written quote is by fax communication. The alternative is the U.S. Mail. The department may fax the Request for Quotation form to the three prospective vendors along with the Fax Instruction Cover Sheet containing quoting instructions and the standard terms and condition pages. A sample of the Town's Standard Terms and Conditions for duplicating can be found within this manual in Division 8, Sample Forms (F), Item #F0060. (Departments may duplicate the Standard Terms and Conditions by photo copying or request an electronic file. The Town's Purchasing Division must make any changes or additions to the Standard Terms and Conditions.)

    In the case of a solicitation for services to be performed (including construction services) an approved contract by the Town Attorney must accompany the solicitation package. A contract can be obtained from the Purchasing Division. Also, the Purchasing Division can assist you in preparing this document for review and approval.

    Note: On-site meetings and conversations with potential quoters will not take the place of the aforementioned solicitation requirements.

    The complete Request for Quotation package will consist of the following items faxed to the prospective vendor.
    1. Fax Instruction Cover Sheet (F0050)
    2. Standard Town of Collierville Terms and Conditions (F0060)
    3. Request for Quotation Form (F0040)
    4. Approved Contract (If Required)
  1. Evaluating The Returned Quote Forms

    The department will gather all submitted quotes and enter the correct quote information within the designated area provided on the Request for Quotation form for ease of evaluation. The following areas should be completed within the Summary of Quotations for an accurate evaluation.
    1. Record the item number that refers to the correct item quoted.
    2. Enter the amount quoted for each item that corresponds to the specific vendor.
    3. Enter the shipping amount quoted for entire quote that corresponds to the specific vendor.
    4. Verify the accuracy of the offered lump sum total from each returned Request for Quotation form and enter it in the area for each corresponding vendor.
    5. Enter the payment terms for each vendor if they insist on other terms than preferred by the Town (Net 30 Days).
    6. Enter the freight terms for each vendor if they insist on other terms than preferred by the Town (F.O.B. Town of Collierville or F.O.B. Destination).
    7. Enter the anticipated ship date as indicated on the specific vendor's Request for Quotation form.

V.    LEGAL RESPONSIBILITY

When obtaining written quotations from vendors, you are subject to the same legal constraints that apply to all Town bids. You cannot reveal one vendor's price to another vendor until the Purchase Order has been generated and accepted by the awarded vendor. No price revisions are allowed to be made by a vendor once the initial written quotation has been received from that vendor.

VI.   PRICES RECEIVED ARE LESS THAN $4,000

If the price obtained (lump sum total price that includes shipping and handling costs) at any stage in the written quotation process is less than $4,000 and the price is acceptable and considered competitive, you need not solicit additional prices.

VII.  IS A “NO BID” OR “NO QUOTE” RESPONSE CONSIDERED AS A “QUOTATION”

A “NO BID” or “NO QUOTE” is not considered a vendor quotation unless approved by the General Services Manager. Three qualifying quotes containing a lump sum total amount are required unless special circumstances prevent the department from receiving the three required quotes. A written explanation must be presented to the General Services Manager for approval before a Purchase Order may be issued.

 

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