Dictionary of Procurement Terms

A means of selling goods through an intermediary, such as a wholesaler or dealer, rather than directly from the manufacturer.

Expenditure other than the cost incurred to produce a good or deliver a service (e.g., insurance, rent, and utilities).

Labor provided by those not directly involved in the production of a good or the delivery or a service (e.g., supervisors, security guards, and human resources personnel).

A branch of the engineering profession concerned with the enhancement of systems, organizations, or processes that deal with equipment, materials, facilities, or people to maximize efficiency and effectiveness.

Raw or processed material, or component piece, that is purchased and used to manufacture a final finished product. Sometimes called an “intermediate good.”

A product designed to be larger; more durable, resilient, or powerful; longer lasting; or with a larger capacity than a commercial grade product. See also: Consumer Grade Product, Commercial Grade Product.

A bond that a private company uses to finance construction. (Business 2002)

A bidder/proposer/offeror that does not meet the qualifications stated in the solicitation or a supplier that is currently debarred, suspended, or disqualified.

An increase in the average prices of goods and services, usually measured incrementally over a given time period. (Schiller 2000) See also: Deflation.

A competitive bid, price quotation, or proposal for supplies or services that is conveyed via letter, fax, email, or other manner that does not require a formal sealed bid or proposal, public opening, or other formalities. Generally relegated to requirements that may be considered low value or fall under a stipulated price/cost threshold.