26.1 Planning Contracting

	Planning contracting is primarily concerned in how to create the information for potential sellers to make sure that all requirements have been met.
	Hence, it involves preparing several documents needed for potential sellers to prepare their responses.
	It also includes determining the evaluation criteria for the contract award.

In other words, it is the process providing the opportunity to prepare the documents needed to support the requesting seller response process and selecting seller process.

	Contract planning is where each individual contract is planned out for the project work.
	The main outputs from this process are the procurement documents and the establishment of evaluation criteria.
	It should note that many organizations have got a standard process for preparing this documentation.
	Typical documents to be prepared during this process include:

Request for Proposals (RFP): this is used to solicit proposals from potential sellers. A proposal is a document prepared by a seller when there are different approaches for meeting buyer needs.

26.1 Planning Contracting

	Requests for Quotes (RFQ): this is used to ask for quotes or bids from potential suppliers.
	A bid -also called a tender or quote- is a document prepared by sellers providing pricing for standard items that have been clearly defined by the buyer.

		Normally the RFQ is a document containing all necessary information for the suppliers to give their quote.
		The document makes it obvious that several suppliers are invited to bid on the products; hence create potential for competitive bids.
		RFQs are especially suitable for products that are standardized or produced in repetitive quantities.

An RFQ should typically include the following:

		Contact persons (for commercial and technical questions)
		Part numbers and description
		Quantities to be bought (yearly and per order)
		Drawings and other specifications
		Quality demands
		Delivery address

26.1 Planning Contracting

		Delivery terms
		Payment terms
		Binding period of the quote
		Other terms (purchase agreement/contract)
		Deadline for quotations
		Level of requested price transparency

Inputs

		Procurement management plan
		Contract statement of work
		Make-or-Buy decisions
		Project management plan