Profiling the Commodity

When developing the commodity strategy, User Intelligence Groups should make reference to sustainable procurement. Sustainable procurement means taking into account social, economic and environmental considerations as part of the procurement process. This needs to be considered in the total cost of ownership, to ensure future proofing and in the promotion of innovation. When evaluating tenders, considerations on sustainability must be relevant and proportional to the procurement.

This may affect the direction of the procurement exercise and influence the options available to them. As a matter of good practice sustainability needs to be built in to the earliest stages of the Procurement Journey, when requirements are being identified and specified. You should use the government buying standards (formally Buy Sustainable Quick Wins) best practice specifications where appropriate.

Social aspects

You should familiarise yourself with the social issues in procurement guidance , ensure you comply with the relevant guidance and consider:

• The usability of the product or service for all who will be affected by the contract
• What market engagement or communications could best influence competition, encourage consortia where appropriate or the creation of innovative supply chains
• Whether diversity and equality issues have been addressed
• Whether the terms and conditions are appropriate for the nature of the contract and any associated risk

All of this can assist organisational commitments on diversity and equality and encourage interest from a diverse range of suppliers.

Economic aspects

You should:

• Advertise the requirement so as to maximise participation and increase supplier diversity
• Make the tender documentation and procedure as simple and as accessible as possible

Environmental aspects

You should:

• Use the government buying standards (formally Buy Sustainable Quick Wins) best practice specifications
• Specify sustainable options wherever appropriate
• Adopt a total cost of ownership approach to your price evaluations

Taking Sustainability into account

Government Procurement Services in conjunction with Scottish Procurement developed a total cost of ownership calculator for PCs, laptops and monitors, the principles of which could be applied to other goods.

It can be more difficult to apply a monetary value to some other aspects of sustainability but it is possible to link the requirements of the procurement to the operational and policy objectives of the organisations in an optimum combination of whole life costing and quality.

All aspects of sustainability should be considered throughout the Procurement Journey. You should use the "considering economic impact checklist", which outline steps which can legitimately be taken at the various stages of the journey, and attempts to link these activities to delivery of the government's overarching purpose of increased sustainable economic growth.

A sustainability test and sustainable procurement guidance slides are provided to help you identify and prioritise the sustainable aspects and impacts of your requirement for further consideration during strategy development, the procurement exercise and contract and supplier management.

Any documents you need are available here

Total cost of ownership calculator

Sustainability test

Sustainable procurement guidance

Whole life costing

Considering economic impact checklist

Commodity Characteristic

The purpose of this section is to determine the requirement, agree what is in/what is out of scope and consider ecommerce implications with the User Information Group (UIG) and other key stakeholders.

You should start by breaking down the requirement into its sub-commodities and identify the specific products/services within each sub-commodity. Use one of the templates below to assist in this process.

At this stage you may also want to give consideration to how the products/services are provided e.g. electronic purchase orders, purchasing card, consolidated invoices and self billing. Also you may want to consider, if you are using an electronic marketplace like I Proc, whether or not the commodity you are buying is catalogueable.

The key characteristics for each sub-commodity can now be identified and agreed by using the Key Commodity Characteristics template.

Any documents you need are available here 

Classifying a Commodity

Classifying a Commodity - Blank

Example Commodity Tree

Key Commodity Characteristics template

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