Methods of Obtaining Supplier's Offer, Informal Process Enquiry -quotation Process, Formal Tendering Process and Using Electronic Model Market Place

How Formal...
The level of formality relates to:
 The extent to which a prescribed procedure is followed

 The degree to which information is recorded in written
form, rather than just communicated verbally

 The level of stringency of controls for authorisation


t a bility
Accou
n Options...
 Informal approach
 Enquiry-quotation approach
 Formal tendering
ITC M6:U3:3.1-1

, 1. The informal approach
Simple process, e.g.
 Ask for quotes by phone, & follow-up
in writing or receive supplier’s invoice as record
 Place orders online at suppliers’ websites

Use for:
 Low value/low risk purchases involving a high
administrative cost
12
 Emergency requirements
9 3
6

ITC M6:U3:3.2-1

, 1. The informal approach
Features:
 Both sides know and trust each other
 Minimum effort and no process delay
 Generally, a maximum value is set depending on…
The size of the company
The nature of the business (e.g. commodities)
The amount of trust the company has in its staff
 These purchases are often delegated to users (e.g. using
purchasing cards or reimbursable cash)



ITC M6:U3:3.2-2