Everything You Need to Know About Procurement in Nigeria

Procurement plays a crucial role in the success of any organization, including those in Nigeria.

It involves the process of acquiring goods, services, and works from external sources to meet the needs of the organization.

In this article, we will explore the essential aspects of procurement in Nigeria, including the stages of procurement, important principles, and different types of procurement.

What is Procurement?

Procurement refers to the process of sourcing, purchasing, and acquiring goods, services, or works from external suppliers or contractors.

It involves careful planning, selection, negotiation, and management of suppliers to ensure the organization’s needs are met efficiently and effectively.

The 7 Stages of Procurement

1. Need Identification

The procurement process begins by identifying the organization’s needs and requirements. This stage involves assessing current resources and determining what needs to be procured externally.

1. Planning

In this stage, a procurement plan is developed, which includes defining specifications, estimating budgets, and establishing timelines. It also involves conducting market research and identifying potential suppliers.

1. Sourcing

Once the planning stage is complete, the organization starts the sourcing process. This involves reaching out to potential suppliers, collecting bids or proposals, and evaluating them based on various factors such as cost, quality, and reliability.

1. Negotiation

Negotiation plays a vital role in procurement, as it helps to secure the best possible terms and conditions with suppliers. This stage involves discussing pricing, delivery schedules, warranties, and other relevant aspects to reach mutually beneficial agreements.

1. Contracting

After successful negotiation, the organization formalizes the agreement with the chosen supplier through a legally binding contract. The contract outlines the terms, conditions, and expectations from both parties.

1. Delivery and Receipt

At this stage, the supplier delivers the procured goods, services, or works as per the agreed terms. The organization verifies the delivery and ensures that it meets the specified requirements.

1. Evaluation and Feedback

The final stage involves evaluating the performance of the supplier and the overall procurement process. This includes assessing the quality of the delivered goods or services, supplier compliance, and other relevant metrics. Feedback is provided to the supplier to drive continuous improvement.

Principles of Procurement in Nigeria

1. Transparency

Procurement in Nigeria should be conducted in an open and transparent manner to promote fairness and prevent corruption. All relevant information, including bidding processes and selection criteria, should be made accessible to all potential suppliers.

1. Competition

The Nigerian procurement system encourages competition among suppliers to ensure value for money. Fair and unbiased evaluation methods are employed to select the most qualified and cost-effective suppliers.

1. Accountability

Procurement processes in Nigeria emphasize accountability to ensure that public funds are used responsibly. This involves maintaining proper records, conducting audits, and implementing checks and balances to prevent fraud and misuse of resources.

1. Efficiency

The procurement system in Nigeria aims to achieve efficiency in terms of cost, time, and quality. Streamlined processes, standardization of procedures, and the use of technology are encouraged to improve overall efficiency.

Types of Procurement

1. Open Tendering

This type of procurement allows any interested supplier to submit bids or proposals in response to a public announcement or invitation to tender. It promotes competition and transparency.

1. Restricted Tendering

In restricted tendering, only pre-selected suppliers are invited to submit bids or proposals. This method is suitable for situations where a limited number of suppliers possess the required qualifications or expertise.

1. Request for Proposals (RFP)

RFP is commonly used for procuring services or complex projects. It involves requesting detailed proposals from suppliers, focusing on their approach, expertise, and solutions to meet the organization’s needs.

1. Single-Source Procurement

Single-source procurement occurs when there is only one capable supplier available or when urgency or exceptional circumstances justify it. It is typically used for specialized goods or services.

FAQ

What are the benefits of procurement in Nigeria?

Procurement in Nigeria brings several benefits, including cost savings through competitive bidding, increased efficiency in resource allocation, improved service delivery, and reduced corruption risks through transparent processes.

Are there any specific procurement regulations in Nigeria?

Yes, Nigeria has specific procurement regulations, including the Public Procurement Act of 2007 and subsequent amendments. These regulations aim to ensure transparency, accountability, and efficiency in public procurement processes.

How can I become a registered supplier for government procurement in Nigeria?

To become a registered supplier for government procurement in Nigeria, you need to follow the guidelines outlined by the Bureau of Public Procurement (BPP). The BPP provides information on registration requirements and processes.

What role does technology play in procurement in Nigeria?

Technology plays a significant role in modern procurement practices in Nigeria. It facilitates e-procurement platforms, online bidding, electronic contract management, and data analytics, enabling more efficient and transparent processes.