RDCIS an unit of SAIL, which being a Central Public Sector Enterprise (CPSE), follows a detailed Purchase Procedure which incorporates the guidelines of Central Vigilance Commission (CVC) & Government Of India (GOI) and executes these functions in a transparent & fair manner. SAIL is a pioneer among Public Sector Undertakings (PSU) in adopting newer technologies/tools, like e-Commerce in carrying out its MM functions more efficiently.
From our daily life, we know that everyone of us depends on commodities and services supplied by other individuals or organizations. Similarly, every organization, big or small, depends on materials and services from other organizations to varying extents. These materials and services are obtained through exchange of money. SAIL, is a major steel producer in the world with a annual turnover of Rs.40,000 Cr, Materials constitute an important ingredient of inputs to the activities of a manufacturing organization like SAIl, where about 50 to 60 % of the total expenditure incurred on materials andrelated services. The various materials used as inputs, such as raw materials, consumables & spares, are required to be purchased & made available to the shops / users as & when needed to ensure uninterrupted production. Therefore efficient management of input materials is of paramount importance in a business organization for maximizing materials productivity, which ultimately adds to the profitability of the organization. This requires well coordinated approach towards various issues involving decision making with respect to materials. All the materials related activities such as material planning & indenting, purchase systems & procedure, variety reduction through standardization & rationalization, reducing uncertainties in demand & supply, handling & transportation, inspection, proper storage & issue of materials to the internal customers, inventory management, vendor management & finally disposal of obsolete, surplus & scrap materials etc. taken together is termed as “INTEGRATED MATERIALS MANAGEMENT”.
To carry out these functions efficiently, it is essential to have a very good supplier base, order booking process & inventory management system as well as expert Materials Management (MM) professionals.

The individual departments fill up the “material indent form” and hence lay down their specific requirements for the  product or a service. The material indent form gives details such as
  • The requirement category, whether its ”normal” or “emergency”.
  • Project details
  • Budget approval from the finance department
  • Delivery schedule
  • Quantity required
  • After the receipt of the indent form the next step comprises of taking decision on the type of tender.
  • The type of tender is decided on the basis of
  1.       Nature of the material/service required i.e. whether the requirement is urgent or normal and a more general material is required which can be procured from a number of suppliers. If the material required is specific in nature then not many options of suppliers are available.
  2.        On the estimates given. 
  3.        As the total procurement process is based on the guidelines of PCP 06 ,so if the estimated value is more than 25 lakhs then the department goes for ”open tender”. The invitation to the tender is put at the company website. The company has a large number of available options and the supplier is decided mostly on the basis of techno commercial suitability. If the estimated value is less than 25 lakhs then the company goes for “limited tender” options and the invitation to the tender is not put at the company website .If the requirement of the indent department is highly specific, then the department can’t go with either limited or open tender options. In that case the department goes with “single tender option” Thus this case is limited to propriety materials or services.
  • This step comprise of  issuing the “ invitation to the tenders”, the format of issue is decided .This entails the details regarding the due date of submission and the quantities required.
  • Submission of the quotations takes place till the due date mentioned. Usually the time mentioned in the most invitation of the tenders is 12.30 noon.
  •  After the completion of the time given for the submission of the tenders, the tenders are opened in the presence of three executives.
  • Executive from the purchase department.
  • Executive from the finance department
  • Executive from the indent departmentThe technical evaluation is done by the indent department. They issue a “ Techno comparative “statement.
  • Usually the tenders which are above one lakh in estimated value come in two parts .The first part comprises of the technical specifications and the second part comprises of the Price bill.
  • For the estimates less than one lakh both the technical specifications and the price bill are submitted together.
  • First the technical specifications of such tender is submitted and later the price bills are opened.
  • The indent department is only responsible for making the technical evaluations depending upon the techno commercial compatibility. Tenders are selected after filling up the commercial comparative statements.
  • Now proposal for the order placement is made and the order is placed.
  • The stores department which is a part of the materials management department receives the goods and the services purchased. These goods and the services are the inspected and temporarily stored in the Stationary department and then sent to the respective indent department.

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