Local government in Australia plays a crucial role in procuring goods and services for their communities. One of the common procurement methods used by local councils is direct purchasing. Direct purchasing occurs when a local council chooses to buy goods or services directly from a supplier without undergoing a formal tendering process.
The threshold for direct purchasing varies from council to council, but it is generally around $150,000 or less. This means that purchases exceeding this amount must go through a formal tendering process, which includes advertising the opportunity, receiving and evaluating responses, and selecting the most suitable supplier.
Even though direct purchasing has a lower threshold, local councils must still abide by strict guidelines and regulations to ensure the process is fair, transparent, and in the best interest of the community. This includes ensuring that the procured goods or services are of high quality and represent good value.
Local councils have policies and procedures in place to guide the direct purchasing process. This includes ensuring a clear understanding of the specifications and requirements of the goods or services being procured.
When it comes to direct purchasing, local councils can source goods or services from various sources such as existing suppliers, new suppliers, or suppliers recommended by other councils. In all cases, the council must follow its policies and procedures to ensure the best value for money.
In addition to direct purchasing, local councils also have the option to use indirect purchasing methods such as contracts and purchasing agreements. These methods are usually used for larger or more complex purchases and provide a structured process for securing goods or services.
Contracts and purchasing agreements are used to establish a long-term relationship between a local council and a supplier. This relationship can bring benefits such as lower prices, improved delivery times, and increased efficiency.
When it comes to contracts and purchasing agreements, local councils must also follow strict guidelines and regulations to guarantee that the process is fair and transparent. This includes advertising the opportunity, receiving and evaluating responses, and selecting the most suitable supplier
Local government in Australia plays a significant role in procuring goods and services for the benefit of their communities. Building relationships with government buyers and increasing your company’s profile can be crucial in securing procurement opportunities. Whether through direct purchasing for smaller purchases or contracts and purchasing agreements for larger and more complex ones, it is important to follow strict guidelines and regulations to ensure that the procurement process is fair, transparent, and in the best interests of the community.