E-learning programmes for Contracting and Procurement

Managing the Quotation Process

• Which are the goals of the buyer at the specification stage?
• How to communicate with - and what is role of - internal customer?
• How to assess internal customer needs and develop a Terms of Understanding
  document?
• Market exploration
• Why is it important to challenge specs?
• How to challenge specs with internal customers - 5W methodology
• Functional and technical specs
• Knock-out versus nice to have criteria
• What are winning criteria? Why are they important?

• What is a RFI/RFQ - why are they important and when should you use it?
• What are the different sections of a RFQ?
• Template RFQ and RFI
• What is the ideal number of suppliers to invite for the RFQ or RFI?
• When would you involve the internal customer and suppliers in the process? How?
• Communication with suppliers: how - when

• How to you analyse supplier offers?
• Which suppliers will you invite to negotiate with?
• What goes wrong with most negotiations?
• Why do you need min. 2 credible suppliers to negotiate with?
• How to prepare for the negotiation?
• How/where/when to negotiate?
• The top 10 questions buyers receive from suppliers - possible answers
• How to select the winner? What is the role of the internal customer?
• How to give feedback to all suppliers after negotiation?
• Negotiation tips

• Written or oral contracts?
• Role of buyer in the process?
• Impact of important contract clauses like evergreen contracts, automatic indexes, penalty clauses, exit clauses

• Why should a buyer apply the highest standards of integrity?
• What information can the buyer (not) give to 1 or to more suppliers?
• What about gifts? What about gifts during tender period?
• How does company policy relate to buyer ethics?

• Assess their understanding of fundamental tendering principles.

• What is the goal of negotiation: balancing the 5 R's
• What are WIN-WIN negotiations? When to use?
• What is your negotiation style: questionnaire to assess your own style

Winning Buyer-Supplier Negotiations

NE1002: How to Prepare a Negotiation

Topics include:

• What are critical issues? Do they relate to internal client needs?
• Set stretching targets. Determine Walk-away position
• Importance of developing other issues to trade
• Which suppliers to shortlist for negotiation?
• What is ZOPA?
• What is a BATNA?

• Positive negotiation climate: why do you need it / what is it?
• How to understand supplier offer?
• Listening skills
• Standard vocabulary/answers
• Taking a position

• How to ask the right questions: open/closed/leading/hypothetical questions
• Reading the Body Language of your supplier
• How to make concessions (who gives first bid, learn to trade minor issues, say yes to options, ...)
• Tactics: low ball/high ball, what-if, bluffing /bogey/expose supplier tactics

• When to stop bargaining and closing the deal: spot closing signals
• Handle last minute objections
• Finalize the deal and communicate with internal customer

• Top 6 negotiation tips
• Pitfalls

• Assess their understanding of fundamental negotiation principles.

Legal Issues in Purchasing

• What is a contract?
• Difference between "invitation to treat", "counter offer" and a "contract"
• Is an oral contract valid?
• Which contracts needs to be written by law?
• What is battle of forms? How to avoid?
• Framework agreements
• E-contracts

• Recognize and deal with impactful clauses - often proposed by suppliers - that may expose your company
• Exclusion clause
• Automatic index clause
• Silent extension of contract
• Delivery clause / incoterms
• Exit clause
• How to opt out easily of a contract
• Threat of an exit clause on performance of supplier

• Ways to terminate a contract in case of poor supplier performance
• By frustration
• By mutual agreement
• By breach of contract
• Remedial clauses (what is it/when to use)
• Liquidated damages clause
• Penalty clause
• Equitable damages clause

• What are your rights if you some terms in the contract are missing or are badly specified?
• Late delivery
• Missing payment terms - supplier send faulty invoice
• the suppliers delivers same specs but different brand
• the supplier delivers defective goods, incomplete delivery, too many goods
• Title of ownership
• Subcontracting
• Unfair contract terms
• Remedies (rights of a buyer in case of breach of condition or warranty)

• Why avoiding legal proceedings
• Importance of exit clauses
• ADR Alternate Dispute Resolution methods
  i. Mediation
  ii. Conciliation
  iii. Arbitration

• Assess their understanding of fundamental legal principles.

Finance for Non-Finance Professionals

• Active/passive and 5 boxes of a balance sheet
• Fix assets
• Current Assets
• Owners' funds
• Long-term liabilities
• Current liabilities
• what is the financial business cycle
• Critical values of balance sheet: Total Assets, Capital Employed, Net Worth

• Structure of P&L
• total revenue
• Cost of Sales
• gross profit
• operating costs
• financial costs
• net profit
• What is EBIT - EBT - EAT - RE

• Why is cash king?
• What are the components of cash cycle?
• Role of profit and depreciation in cash flow
• Difference between cash and profit - how can a profitable company go bankrupt?
• How can you - as a manager - influence the cash flow of your organization?

• Liquidity ratios
• Current Ratio
• Quick Ratio
• Working Capital to Sales Ratio
• Performance Ratios
• ROTA
• ROE
• Working Capital

• Assess their understanding of fundamental finance principles.