Criteria for choice of a supplier of goods and services and a performer of work for state or municipal needs

When using competitive procedures of placing the order (competition, auction and request of price quotation) the main criterion of choice is the price, but in case of buying from a sole supplier the order is placed at the price charged by the customer.

According to the Law it is the customer (or authorized representative) who determines the initial (maximum) price. Thus the efficiency of the purchase process begins at the first stage of this process - the stage of planning and the customer's task is to determine the initial price fairly.

S. R. Shibaev selects some distinctive features of state consumption which are revealed in the process of state purchases and influence the decision making process about the initial (maximum) price of the contract. They are:

· compulsory character of consumption;

· objective character of consumption;

· expedience of the things to be consumed;

· reasonable quantity of consumption.

Compulsory character of consumption implies that the Subjects of the Russian Federation, government and municipal organizations will buy goods, works and services for the purpose of using them by corresponding people (the employees of the customer) and the latters will have no right “to refuse” the things having been bought for consumption.

Objective character of consumption implies that consumption is determined by the state on behalf of the corresponding government organization carrying out useful activity according to the Law. This is the consumption at the expense of the state (the state budgetary funds are used) and this consumption is necessary for the public at large.

In case of state consumption everything that is consumed includes only goods and services that are really necessary for functioning of public organizations. The state cannot afford to purchase unnecessary, defective or harmful things which can do harm not only to individuals but also to a society. Moreover, the damage from buying defective things can even be dangerous for a society. That is why it is very important to take into account all the features (characteristics) of goods, works and services in order to satisfy available needs in the best way.

Consumption of goods, works and services by public organization is performed on the basis of scientifically-or practically-motivated norms and standards, which means that quantitative subjectivity of consumption by government organizations is less than that in case of private consumption. When determining the initial price of the contract it is necessary to make exact calculations of quantity of goods to be purchased and the volume of works and services to be purchased.

According to the Law the maximum price of the contract is determined by the customer (or authorized organ) as a result of the research of the market of goods, works and services needed (art.43 of the Law). It should be noted that this instruction refers to the procedure of placing the order by means of request of price quotation. However the same is true about placing the order at the competition or at the auction.

In a word, when determining the initial (maximum) price of the contract the customer must be guided by the results of monitoring of market prices. The chart of the decision making process about the initial (maximum) price is shown in fig.1.

Fig. 1. The chart of the decision making process about the initial (maximum) price of the contract

For determining the level of existing prices the customer can use the following methods:

1) determination of weighted average price with the application of different adjustments concerning volumes of deliveries, time of deliveries, inflation processes, terms of deliveries and terms of payment;

2) determination of the price by analogues, when the item of the purchase is not represented in the market or when it is impossible to find the market data about the competitive prices, but similar goods are represented in the market;

3) expenditure method on the basis of calculation of consumed resources (this method is mainly used at determination of the price for construction, repair or reconstruction of buildings);

4) parametric method on the basis of calculation of the approximate price of the technological equipment depending on its power, capacity, size or some basic technical parameter.

The choice of the method of price formation depends on a certain situation of the purchase and is made by a customer.

When determining the price of a contract using the weighted average price the customer must make analysis of the prices on the market, determine corrective coefficients for the bargain stipulation and calculate the weighted average price.

Determination of the price of the contract by analogues requires carrying out the preliminary analysis of the market for the purpose of establishing the fact of the absence of the necessary item of the purchase on the market, finding the analogue of the item of the purchase, determining corrective coefficients for charging the price.

Expenditure method of pricing implies the calculation of expenditure estimate on the base of confirmed tariffs or other sources of separate prices for the volume of works, material and for the use of equipment and machinery. Drawing up estimates is rather a labor intensive process requiring corresponding qualification of the personnel.

The use of a parametric method of contract pricing is connected with the necessity of the collection of appropriate information about technical characteristics of purchased equipment, the determination of the so-called inhibition coefficient by an empiric way or by the way of analyzing special literature or special sites of informative Internet resources, the latter also requires specially trained employees.

The experience in making purchases for the state and municipal needs of the Amur region has shown the following distribution of total volumes of purchases according to the types of the procedures in 2007 and 2008 (for the period of 9 months).

Chart 2

The volume of state purchases for the needs of the Amur region in 2007 - 2008

In fig.2 you can see a graphic interpretation of purchase volume distribution according to the kinds of procedures in 2007, in fig.3 - for the period of 9 months in 2008.

Fig.2. The composition of state purchases for the needs of the Amur region according to the kinds of procedures in 2007

Fig.3. The composition of state purchases for the needs of the Amur region according to the kinds of procedures for the period of 9 month in 2008

Thus, in 2007 the basic volume of goods, works and services for the needs of the Subject was bought from a sole supplier. The same trend is kept in 2008/

Situations of purchases from a sole supplier may be divided into 2 groups according to art.55 of the Law:

1) the situation when it is not effectual to held competitions or auctions or to request price quotations;

2) the purchase in the situations when the procedures of bargaining are recognized not to take place (items 8, 9, 10, 11 p. art.55 of the Law).

In 2007 the volume of purchases of the first group made up 522,2 mln.rubles. It accounted for 33,17% of the volume of purchases from a sole supplier and 27,7 % of the total volume of purchases. The purchases of the second group made up accordingly 1052,2 mln.rubles 68,83% of the volume of purchases from a sole supplier and 55,8% of the total volume of purchases.

The analysis of the pattern of purchases from a sole supplier on the results of the procedures of bargaining which didn't take place or the request of price quotation according to kinds of products has shown that 9,88 % were spent for buying works connected with current repair, 1,55% - for buying medicines and products for medical purposes, 1,65% - for buying information services and 1,75% - for buying combustible lubricants. These data are evidence of the absence of the established market of the above mentioned goods, works and services.

When making a contract with a sole supplier in the situation when bargaining didn't take place and in situations of the price quotation request the prices are charged by the customer and those prices are actually initial (maximum) prices.

When placing the state order for the needs of the Amur region the monitoring of the market prices is carried but by a special department of State Orders Management of the Amur region government. In 2008 initial maximum prices of contracts charged by the customers at the stage of planning were cut by 40,46 mln.rubles as a result of the monitoring of market prices. It accounted for 3,1 % of the initial price. It should be noted that the above given example refers to the placing of orders for the needs of the Subject of the Russian Federation. When placing the state order for the Federal needs or for municipal needs the monitoring of prices for the purpose of determination the initial (maximum) price of the contract is carried out by the specialists of the customer.

The Amur state university has the Centre of raising one's professional skills in the field of placing state and municipal orders for the needs of the Amur region. The fact is that in reality the responsibilities of specialists in placing state and municipal orders are performed by the employees who have those responsibilities as additional to their basics ones. That's why as a rule such specialists have no proper skills, experience and simply have not enough time to carry out the monitoring of market prices qualitatively. They often don't take into account all the factors that influence the average level of market prices. That's why the price adopted by the customer as the initial price of the contract doesn't reflect the real market situation and is often higher than it should be. In consequence the efficiency of the procedures of placing state and municipal orders is not optimal.

According to the data of State Order Management department of the Amur region government the economy of budgetary funds in placing state order for the period of nine months in 2008 accounted for 1284 mln.rubles.

Having in mind the fact that the greater share of all purchases is still bought from a sole supplier at the prices determined by the customer it may be supposed that the achieved economy isn't top.

In order to achieve additional economy of budgetary funds at the stage of planning the initial (maximum) price of the contract it is necessary to carry out the monitoring of market prices more thoroughly. To fulfill this task it is quite effectual to have the position of a manager on purchases with corresponding skills in the staff list of the customer.

Literature and the sources