Saturday 23 August 2014

Significance of Pre-Qualification

Authored by Fahad Amjad

Pre-qualification is the process of up-front identification of best of rest suppliers able to compete for specific types of contract opportunities. Prequalified suppliers are those whose record of performance in the marketplace, whether commercial or governmental, demonstrates their ability to perform to consistently high standards of quality and reliability. Selection of the right suppliers is very critical process. Having the right choice of suppliers reduces operational risks. Prequalifying suppliers enhances competition, ensures quality performance, and can also shorten cycle time and strengthen relationships between the buyers and its suppliers.

Suppliers benefit from having a more comprehensive opportunity to familiarize themselves with the buyer organization requirements.

Prequalification may be used:
On an ongoing basis for commercially available goods or services purchased routinely or For an individual purchase or for a series of purchases.

One of the important advantage of pre-qualification is to reduce the need to evaluate unqualified contractors. It is way of diminish the field to only those who have the vital ability to comply with the terms of the contract and the financial capability to undertake the work.Thus for certain contracts, particularly large contracts or those involving highly technical work, a procurement entity will before advertising for bidders for the contract, first ask for invitations for pre-qualified bidders.

Prequalification allows for unqualified bidders to stay out and thus helps to speed up evaluation of bids since only a limited number of pre-qualified bids have to be examined. This means that only those firms pre-qualified would be eligible to bid on the contract. The prequalification is merely for companies to demonstrate that they have the ability to undertake the work or supply of whatever it has to be sourced.