PROJECT PROCUREMENT
PROCUREMENT OF
COMMERICAL KITCHEN
EQUIPMENT AND
MACHINERY FOR A
RESTAURANT BUSINESS
PROJECT PROCUREMENT PLAN
GROUP 6
RAMEEN SHAKEEL
JAVERIA RIAZ
UMER SHAFIQ
OMAR ASHFAQ
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PROJECT PROCUREMENT PLAN
Table of Contents
Project Charter ........................................................................................................................................ 3
Project Description: ............................................................................................................................ 3
Project Objective................................................................................................................................. 3
Make or Buy Analysis .............................................................................................................................. 5
Potential Suppliers: ................................................................................................................................. 9
TERMS AND CONDITIONS ..................................................................................................................... 10
TABLE OF CONTENT
1. Project description……………………………………………………………………………………………….. 3
2. Project objectives…………………………………………………………………………………………………. 3
3. Definition……………………………………………………………………………………………………………… 3
4. Project scope statement………………………………………………………………………………………. 4
4.1. In scope………………………………………………………………………………………………………… 4
4.2. Out of scope…………………………………………………………………………………………………. 4
4.3. Project pre-requisite…………………………………………………………………………………….. 4
4.4. Enterprise environmental factors…………………………………………………………………. 4
4.5. Organizational process asset………………………………………………………………………….4
5. Make or buy decision………………………………………………………………………………………….. 5
6. Work break down structure………………………………………………………………………………… 5
7. Risk categorization……………………………………………………………………………………………… 6
8. Risk register………………………………………………………………………………………………………… 6
9. Risk matrix……………………………………………………………………………………………………………7
10. Project schedule…………………………………………………………………………………………………. 7
11. Supplier selection criteria…………………………………………………………………………………… 8
12. Bids participant………………………………………………………………………………………………….. 9
13. Success criteria…………………………………………………………………………………………………... 9
14. Terms and condition………………………………………………………………………………………….. 10
15. Conclusion…………………………………………………………………………………………………………. 11
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PROJECT PROCUREMENT PLAN
Project Charter
Project Description:
This project is forA Restaurant is to be setup Food’s inn is a major restaurant chain established in
2018 having several branches in different cities of Pakistan presently. Currently, they intend to open
a new branch in Karachi city’s food street area.
Project Objective
The purpose of this project is to procure commercial kitchen equipment and machinery and make
them operational for Food’s inn restaurant who is recently going to open its branch in Karachi.
Definitions

Commercial kitchen equipment: is defined as commercial-only equipment that is suitable to
be installed in a commercial kitchen environment to include, but not limited to: Mixer,
Grinder, Blender, Chopper, Non-stick cookware, Coffee/tea maker, Cooking range, Stove,
BBQ pit, Deep fat fryer, Grill, Toaster, Microwave, Refrigerator, Utensils and kitchen tools.

Supplier/Vendor: An individual or entity whose work is to sell the goods to the final
consumer. To make the goods available to the people who need it.

Buyer/ Contractor: An individual or entity employed to select and purchase stock or
materials for a large retail or manufacturing or service business.
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PROJECT PROCUREMENT PLAN
Project scope statement
In scope
The scope of this project includes:



To procure commercial-only kitchen equipment and machinery.
The machinery list includes: Mixer, Grinder, Blender, Chopper, Non-stick cookware,
Coffee/tea maker, Cooking range, Stove, BBQ pit, Deep fat fryer, Grill, Toaster, Microwave,
Refrigerator, Utensils and kitchen tools.
Any unexpected equipment failure that requires an emergency repair call and cost way more
than simple maintenance shall be taken into account by the Supplier.
Out of scope



The shipping and delivery charges shall not be paid by the supplier.
Setup and installation work shall not be carried out by the supplier.
Remanufactured or refurbished products are not acceptable.
Project Pre-Requisite



Availability of land/ storage
Requirement estimation has already been done.
The restaurant menu is finalized.
Enterprise Environmental Factors



Market demand of the type of cuisine that will be served in the restaurant and equipment
required in its preparation.
The resources available to acquire machinery and equipment
The HR expertise related to operating commercial machinery.
Organizational Process Assets



Processes, guidelines and procedures provided by the fo;od’s inn team which was practiced
in the past project
Lesson learned register from the other branches projects.
Food’s inn corporate knowledge base with their experience with similar past projects on
other locations
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PROJECT PROCUREMENT PLAN
Make or Buy Analysis
To decide whether to Make or Buy the required products, a thorough Make or Buy analysis has been
conducted in which it is concluded that all the required goods for this project are over the counter
available and the complexity of buying them is significantly less than producing them in-house.
Figure 1: Make or Buy Analysis
Work Breakdown Structure
Work Breakdown Structure defines the deliverables at the result of each activity performed.
Figure 2: Work Breakdown Structure
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PROJECT PROCUREMENT PLAN
RISK CATAGORIZATION
Risk is any unexpected event or result deviated from the desired outcome that can affect the
project.
Procurement risk are possible failure to procure goods or services. It is obtained through different
identification processes which give risk register once combined in a tabular form. It includes risk
probability, its impact and contingency plan to avoid possible failure of the procurement hence the
project.
Risk Register
Risk register is a central depository of all the identified risk to track and plan best course of action
against each.
Here each risk is tabulated with regards to procurement that will ease to meet the objective and
goal, that is in-time and accurate procurement.
RISK
ID
RISK
CATAGORY
PROBABILIT
Y
IMPAC
T
RESPONS
E
1
Economical
1.1
E1
Taxation
1
3
Accept
1.2
E2
Price Hikes
3
5
Accept
2
Political
Strikes
Strikes can disrupt
timely delivery of
items
2
2
Accept
Natural disaster
Natural disaster
can cause delayed
delivery
3
4
Accept
4
3
Mitigate
3
3
Mitigate
3
5
Mitigate
3
4
Mitigate
RISK TYPE
2.1
P1
3
Environmen
t
3.1
En1
4
Technical
4.1
T1
Warranty
4.2
T2
Estimation
4.3
T3
Availability
4.4
T4
Malfunctioning
DESCRIPTION
New taxes
introduced by
government
Prices increased
due to inflation
Machines
delivered without
warranty
imporper
requirement
estimation
Required models
not available in
market
Defective product
delivered
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PROJECT PROCUREMENT PLAN
4.5
T5
Logistics
4.5.
1
T5.1
4.6
T6
Miscommunicatio
n
Delayed delivery
from the vendor
wrong delivery of
products
Miscommunicatio
n regarding
product type
4
4
Mitigate
3
4
Mitigate
4
4
Mitigate
or delivery
RISK MATRIX
By evaluating the risk from expert opinion in the risk register Probability and Impact matrix is
prepared to analyze the impact of each risk on our project. With the help of this, we will be able to
decide what action needs to be taken. Whether we have to mitigate, avoid or accept the risk.
Probability and Impact scale
Negligible
5
4
3
2
1
Minor
Moderate
Major
Very likely
T3 E2
Likely
En1 T4 T5.1
T5 T6
T2
T1
3
4
Moderate
E1
Unlikely
Extreme
P1
Rare
1
2
5
Project Schedule
This Project is set to be completed within 60 days period from project initiation to project closing.
The estimated activity breakdown with its duration is as follow:
Activity
Duration (Days)
Requirement Estimate
5
Procurement Plan
5
Supplier Selection
10
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PROJECT PROCUREMENT PLAN
Award of Contract
3
Conduct Procurement
30
Close Procurement
7
Total days:
60
SUPPLIER SELECTION CRITERIA
Supplier selection criteria involves obtaining bids and offers from different vendors. Selection criteria
would be based on
1. Financial 60%
 Pricing: Pricing and Terms that provide for increased discounts and lower overall
cost
 Financial stability
2. Technical 40%
 Reliability
 After sale service
 Market demand
The cost will be weighted more for the successful selection of any supplier. 60% preference will be
on the financial basis while 40% will be on technical. Since we will be working on a Fixed-Price
contract, the supplier with the least quoted price will be preferred. After cost, the supplier must
have a good reputation in the market. For this very purpose, we will ask them for references or
relevant past work they have done. 5 years will be the minimum time requirement that the supplier
must be in business to pass the criteria (Reliability). Another critical factor will be the after-sale
service. If any equipment or machine results in a problem will the supplier replace or repair it.
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PROJECT PROCUREMENT PLAN
Potential Suppliers:





Z'Mario Italian Kitchens System.
Prestige Kitchens
Awesome Kitchens
WestPoint
Anex
Financial Evaluation:
Supplier Name
Dawlence Electronics
Haier Pakistan
Prestige Kitchens
FINANCIAL EVALUATION
Pricing
Financial Stability
(80)
(20)
70
15
68
18
72
10
Total
(100)
85
86
82
Technical Evaluation:
Supplier Name
Dawlance Electronics
Haier Pakistan
Prestige Kitchens
TECHNICAL EVALUATION
After sale
Reliability
service
(20)
(20)
19
15
17
13
13
15
Market Demand
(60)
50
55
40
Total
(100)
84
85
68
Calculating on the basis of weightage:
Supplier Name
Dawlance Electronics
Haier Pakistan
Prestige Kitchens
FINAL EVALUATION
Technical Evaluation
Financial Evaluation
(40%)
(60 %)
27.6
51
28.8
51.6
21.2
49.2
Total
(100 %)
78.6
80.4
70.4
Success Criteria
To successfully pass the criteria supplier should get 85+ out of 100 points in financial category. While
in the technical aspect they should achieve 80+ points out of 100. Altogether 80% would be the
bench mark for winning the contract.
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PROJECT PROCUREMENT PLAN
TERMS AND CONDITIONS
Completion Time
Warranty
Payment
Support
Invoice
Damage Control
Conflict of Interest
Supplier must deliver the items within 3 weeks after receipt of firm
supply order
Minimum 1 year warranty is necessary for each product supplied
Full payment will be made after delivery and satisfactory inspections of
goods to the desired location
Supplier shall provide a single point of contact plus a backup to contact
customer service representative during normal business hours of every
business day.
Invoices shall be directed to the appropriate location(s) specified by the
buyer. Invoices and payment terms must comply with the requirements
of the buyer and supplier.
Proper sale tax invoice would need to be presented for the payment and
completion of the contract
Supplier will be responsible for proper handling and delivering it to the
desired location
If Supplier fails to deliver, or erroneously delivers products, Supplier is
required to take immediate corrective action to make the correct
delivery at no cost to buyer.
In order to avoid even the appearance of any conflict of interest, neither
Supplier nor Buyer shall employ any employee of the other party for a
period of one year from the date of contract
Conflict of Interest

In order to avoid even the appearance of any conflict of interest, neither Supplier nor Buyer
shall employ any employee of the other party for a period of one year from the date of
contract
Force Majeure:

Neither party shall be held responsible for any losses resulting of the fulfillment of any terms
of the contract delayed or prevented by any cause not within the control of the party, and
which by the exercise of reasonable diligence, said party is unable to prevent.
General conditions




Buyer reserve the right to refuse the service for any reason at anytime
Without limiting to any right purchaser can return the non-conforming products
Supplier represent and warrant to that all supplied item will be brand new and without any
fault
Supplier must be bound to give after sales service for at least a year after their services
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PROJECT PROCUREMENT PLAN
CONCLUSION
After evaluating bids and offers from different suppliers we awarded Haier Pakistan the
procurement contract after they successfully passed all the above listed criteria. We expect that all
the terms and condition will be kept in mind during this whole process.
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