Over the past few months we were out at a number of municipal conferences and events and it always surprises me to hear the number of folks who think municipalities are only able to procure goods or services via the RFP (Request for Proposal) process. They express their dislike for the process and they report the process discourages many small and medium enterprises from attempting to find work in municipalities.

No doubt, in the municipal sector procurement is a dynamic, sometimes complex process. However, what many are not aware of is that there is a variety of procurement methods available to municipalities to procure the goods and services they need.

The procurement of consulting and professional services still must be a competitive process but whether you’re a large company or a small or medium consultant or professional enterprise, it is still possible to acquire work in municipalities without ever needing to respond to a RFP.

In Ontario, Canada, municipalities must comply with the procurement requirements set out in the Municipal Act, 2001, S.O. 2001, Chapter 25, Section 270(1) 3. The legislation requires municipalities to develop policies to be adopted on the types of procurement processes that will be used, the goals of each, the circumstances under which each type will be used, and the circumstances where a tendering process is not required. 

Here are some of the procurement methods municipalities can employ to procure goods and services.

1. Request for Proposal (RFP) – used to solicit solutions for the delivery of complex goods, services or construction for obtaining unique proposals designed to meet broad outcomes to a complex problem or need for which there is no clear or single solution.
2. Request for Tender (RFT) – used to acquire goods and services based on stated terms and conditions and for obtaining competitive bids based on precisely defined requirements for which a clear or single solution exists.
3. Request for Quotation (RFQ) – is where the municipality specifies the product or service and the criteria is based solely on price. The goals are the same as for Request for Tender, except that bid solicitation is done primarily on an invitational basis from a pre-determined bidders list – but may be supplemented with public advertising of the procurement opportunity.
4. Request for Expression of Interest (RFEI) – is a procurement used to determine the interest of the market place to provide goods or service(s) which the agency is contemplating purchasing.
5. Request for Information (RFI) – is a request used as a general market research tool to determine what goods and services are available that may meet business/operational requirements and acquisition strategies. 
6. Request for Pre-Qualification (RFPQ) – is a procurement document used to solicit financial stability, technical information, product or service suitability from potential vendors and measured against stated evaluation criteria. Successful vendor(s) are pre-qualified or short listed to bid on specific categories of work or provide specific types of goods or services, or respond to a particular RFP or RFT
7. Informal, Low Value Procurement – used to obtain competitive pricing for a one-time procurement in an expeditious and cost-effective manner through phone, fax, e-mail, other similar communication method, vendor advertisements or vendor catalogues.
8. Non-Competitive Procurement/Invitational Competitive Procurement – in some circumstances, competitive procurements are not required. Municipalities can invite three or more qualified suppliers to submit written proposals to supply goods or services as specified by them. The goal is to allow for procurement in an efficient and timely manner without seeking competitive pricing.

Non-competitive procurement includes sole sourcing and single sourcing.

Sole sourcing is the procurement of goods or a service that is unique to a particular vendor and cannot be obtained from another source. Single sourcing is the procurement of goods or a service from a particular vendor rather than through solicitation of bids from other vendors who can also provide the same item.

Single sourcing may be the best course to take in some circumstances but it is important for the municipality to be transparent about what those circumstances will be.

Typically, non-competitive procurement is used in the following circumstances:

• when there is a statutory- or market-based monopoly on the item
• when no bids were received in a competitive process
• when the required item is covered by an exclusive right such as a patent, copyright or exclusive license
• when the purchase is already covered by a lease-purchase agreement where payments are partially or totally credited to the purchase
• when it is necessary to ensure compatibility with existing products or to avoid violating warranty/guarantee requirements when service is required
• when the required item is in short supply due to market conditions
• when competitive sourcing for low value procurement would be uneconomical or would not attract bids
• when competitive procurement may be found to be impractical for such items as meal expenses, incidental travel expenses (e.g. taxi service, phone calls), and training and education expenses
• when an urgent procurement is necessary for fulfilling a statutory order issued by a federal or provincial authority, such as an environmental, public health, or workplace safety compliance order.

To procure consulting and professional services in particular for larger more complicated projects, municipalities will still tend to use the RFP method. But for the smaller projects municipalities can, and do employ other procurement methods, such as the informal low value and non-competitive methods when possible.

Often they have no choice but to use these two methods to procure professional services because they simply cannot find enough consulting and professional enterprises to acquire the number of quotes they need to satisfy the requirements in their procurement by-laws and policies.

So, if you’re a consultant and/or a professional who would like to find work in municipalities – don’t give up. There are opportunities for you that do not involve wasting endless hours filling out an RFP only to find that on the 99th page of the 100 page document, there is one requirement you can’t meet.

Helping municipalities and professionals connect is the best way I know of to enhance the municipal procurement process and connect the municipalities and professionals that are trying to find each other.

Simple right?

Note: “In-Procurement”, a procurement magazine in the United Kingdom, published Susan’s article in 2016.

Susan Shannon is the Owner/Principal of www.muniSERV.ca.  Her experiences as both a municipal Chief Administrative Officer (CAO) and as a municipal needs specialist prompted her to create muniSERV. Her passion continues to be to find ways to “Help Municipalities & Professionals Connect”. She can be reached at [email protected].

As some of our members know our partners, bids&tenders invited muniSERV.ca to speak at their users’ group meeting for public sector buyers on October 13th, 2016 – and we invited Keith Strachan, of SellToPublicSector.com to co-present with us.  We asked our members for some common bidder issues they’ve experienced when responding to RFPs – and we got some great ones from you – Thanks!  This is the update we promised to provide to you after the session.

The attendees included buyers from the municipal, healthcare and school sectors. The municipal buyers were from small, medium and large regional municipalities which provided a good cross-section of procurement perspectives.

We shared some of the common bidder issues we heard from you and then asked for feedback from the buyers in attendance. Here’s our presentation slides.

The attendees were very engaged and offered great feedback and solutions to the issues we raised on your behalf.  Here are just a couple of them:

Finding Public Sector Opportunities – A small consultant whose services are usually less than $20,000 may not find many opportunities on public tendering websites.  How do they spread the word and/or where do they post opportunities that fall below their RFP thresholds?

Buyers’ Response:  School boards and Hospitals have mandatory posting requirements for all projects and they all must be through a mandated competitive process.

Municipalities reported they have a difficult time addressing this because there is really no one place to post them. Some hold Vendor Days where they will invite vendors to come in and they will provide them with a list of all upcoming smaller projects.  Still others only circulate them to a list of their preferred vendors in order to save time.

Take Aways: 

muniSERV: We will be actively encouraging municipalities to post, not only their RFP documents, but now also any invitations to bid on these smaller projects, which typically are consulting and professional services.  

Consultants:  Check municipal websites for any upcoming Vendor Days and participate in them.  Also investigate how to become a preferred vendor in the municipalities in which you’re interested in finding work.

Complying with Requirements – Do you really need $5m insurance coverage?

We gave the example of a muniSERV professional who wanted to respond to an RFP for graphic design work but the RFP requested they have $5m insurance coverage, WSIB and a lot of requirements that didn’t seem to fit the small project.  They ended up not responding because they simply could not meet the requirements.

Buyers’ Response: Municipalities need to ensure they have all the bases covered so their legal and risk management teams will include the full standard requirements in the RFP document.  However, if the requirements appear unreasonable for the specific project, vendors just need to call the municipality and bring it to their attention.  The purchasers then will ask their legal and risk management teams to review the requirements and most often they will agree and reduce or eliminate the requirement all together if it’s not imperative or mandatory for the specific project.  If this happens they will then issue an addendum to the RFP to notify vendors of the reduced requirements.  

Take Aways:

muniSERV:  It is interesting to note vendors can make this kind of request and/or that buyers would alter their original requirements, if deemed appropriate. 

Consultants:  If some requirements seem unreasonable for a project you want to respond to don’t be afraid to ask the municipality to reconsider them. You may not need $5m insurance after all! 

Thanks again to all those who took the time to help us!  The presentation would not have gone as well as it did without your input!
 

Thanks too, to bids&tenders for the opportunity to present your bidder issues directly to the public sector buyers so we could learn from each other and continue to Bridge the Buyer/Vendor Gap!

 

Susan Shannon, Principal muniSERV.ca