Buying high value equipment – The in’s and out’s of the procurement process

Commissioning of large scale purchases takes time with planning and coordination to achieve the end results of proving the capacity and design of the equipment meets the expectations of the clients.

So, you’re in the market to make a purchase, maybe a large purchase at that. Have you completed all your homework? Do you have the answers to the questions the procurement department approving the purchase will ask? We could go on and on with the why’s and when’s of purchasing fire apparatus and large mobile equipment but here’s a take on what to do and how to move forward.

When it comes to making a large purchase, there are several factors that will be considered. Most often, the questions will come up as to what is needed versus what is wanted… A needs vs wants chart should be drafted and reviewed by several parties. Reason we say this, is there are always two sides to every story, and then there’s the truth! Let’s take a large hazard for instance. For example, a flammable liquid storage tank battery or a fading service water or fire water infrastructure design that needs to be updated, however time and money have prevented that from happening. These are just 2 examples and are what we’re going to focus on during this article.

Proving system design through FAT and SAT are all important functions of the procurement process and should never be neglected or left out. It’s important you know the parameters of your design requirement and be sure you’re being offered exactly what you requested. As you can see in this photo, clients are observing the system capacity and equipment capabilities.

Using the examples just mentioned, we need to review the hazard(s) and the plan for mitigation. We must now look to what regulations there might be and what industry standards or best practices exist. All of this can be based upon previous incidents and what successes or failures there have been using history, case studies and the experiences from professionals around the world. Another key is also knowing the guidelines or regulations from your region. The AHJ, Authority Having Jurisdiction, will also play a factor in determining what legal requirements might be applicable when determining the appropriate application for emergency response needs. Understanding what the mitigation requirements are will help assess the needs rather quickly. Given we’ve reviewed this information, we’ve now come up with a solution. Some may say this is just a guide and we can do it with minimal spend, however those that make these statements have more than likely never stood in front of the “beast” while it’s raging and consuming everything in its path. Need I say more?

SAT testing and after sales support with training, as shown in this photo, are instrumental in providing management a solid piece of mind the purchase was worthwhile.

The cost of larger scale equipment can get into the millions of dollars for sure! How do we convey to the stakeholders the costs of such equipment outweigh the detriment a large emergency incident can do to our reputation, be it a private or publicly held company or governmental/municipal/civil agency? Along with that thought, what about the environmental impact and ultimately the profit loss because of such a case? Many times, equipment is purchased and never used apart from training and/or annual testing. This is a good thing whether your procurement team wants to believe it or not! Justifying the purchase becomes the biggest challenge within your organization. The old saying, “it’ll never happen” doesn’t hold much weight in my book. I’ll explain that statement a little later in this article. What I’m getting at, is that you end up becoming a salesman yourself if you’re the person requesting the money to spend… Silly as it may seem, I’ve been down this road many a time having been both successful and not so successful.

Let’s get into the needs vs wants. As we divulge into this topic, there are many opinions that can interject. Remember, the opinions expressed in this editorial are those of the writer! Based on past experiences we see factors that can affect the purchasing process. Some good, some bad. Ultimately the highest-ranking authority along with the procurement team will make the decision. Forming a committee to assist in the research required to make these decisions can be your best method, however, the process doesn’t always go as planned. We’ve seen it time and time again, where a committee will decide as a group based on their knowledge, education and industry best practice, then along comes the Fire Chief, Plant Manager, Mayor or other city/government official that will trump the committee and make their own decision. Sometimes that’s Ok, but more times then not, it ends up being a catastrophe. Large purchases should be reviewed and then reviewed again to be sure the items are as specified and meet the requirements of the hazard or response plan that has been developed. You never want a “regret spend” to haunt you for the rest of your career. It’s something that will stick with you both mentally and physically. Too often, companies and agencies are burned by a vendor who just wants to sell a bill of goods and not work with the client to determine the best suitable equipment needed. Equipment should be designed to meet the needs of the customer, directly to that of which they are taking the responsibility to manage.

Another example of the procurement process are factory visits to see, touch and operate the equipment you are sourcing. In this photo, you’ll see a demonstration of a 12 inch Hose Recovery Vehicle restoring hose into the Hose Pod while the potential client observes the equipment in operation.

As mentioned earlier, we’ve seen projects become a sort of shopping list of items that don’t always make sense. The key is understanding what is available from each manufacturer, building your equipment design to meet your largest hazard, and settling down with the design. One thing that has come to light in recent past is how some equipment is still being developed and engineered through time. A large purchase takes time. A lot of time to be exact. Some of these projects could go on for 2-3 years or more before the approvals are all in place to in fact issue the purchase order and award the contract. Over the course of the design of your equipment, from the time the project was conceived, newer and better equipment hits the market. Now what do you do? I can tell you, this is definitely a challenge and at a certain point in time, the decision has to be made to freeze the design and go with a set concept. If you keep changing your design to the latest and greatest equipment that may be on the market, you’ll do nothing more than frustrate the procurement team as they have been working behind the scenes to get the manufacturer approved or better yet, keeping yourself inline with the budget that has been approved. This becomes a definite concern during this lengthy process.

Now that you’ve designed your system and settled on the specifications, the task of approvals from senior management is at hand. As we discussed earlier, this can be tedious and strenuous at times. As we move on throughout this process, the next article will cover the factory inspections, delivery, training and after sale support. Keeping in mind there most likely has been a pre-award or pre-bid visit to a few if not all the manufacturers who can provide you with your desired equipment, some of which will be repetitious but necessary. As the purchaser, it’s your job to provide the due diligence necessary to provide the stakeholders some comfort in these large expenses that don’t provide profit making capabilities BUT can prevent and/or limit profit loss! I say that as we’ve focused most of this discussion on the private sector and the process one goes through to make purchases like these. Budget approvals and budget planning for up to 5 years time in some instances is the time needed to spend millions of dollars in one shot for equipment that will spend 90 percent of its life in storage. It’s a hard price to swallow for most common procurement folks making these decisions. Having large scale emergency contingency plans in place, along with the proper tools to mitigate such an incident is priceless when in the face of scrutiny and the public eye as we strive to do our best in protecting lives, property and the environment during the incident management process.

To prevent or more importantly, be prepared for incidents such as this storage tank fire, plans need to be in place and equipment must be available for a successful outcome and limit property and profit loss.

In the next article, we will discuss activities that will commence once the approval has been made. We’ll go through the next steps of the purchase as mentioned, which include the pre-construction meeting(s), the build process, the mid-point inspections, Factory Acceptance Testing, Site Acceptance Testing, delivery, training and post delivery guidelines. The process of procuring high value equipment goes much deeper than just designing, ordering and taking delivery. Training your personnel takes on an entirely new level of commitment and will create even more work than it took to design the system. Most of which will need to be put on paper so as to not be forgotten over time, but to also establish guidelines that can be followed for years to come. Passing the information on to new users and operators as well as maintaining a constant level of readiness, keeping everyone on the same page of competency is a key factor and will help keep the equipment operating to its designed parameters. In closing, there are many opportunities to seek assistance when it comes to procuring equipment being discussed in this article. Keep in mind your manufacturers staff skilled personnel who have gone through this process themselves and can assist you with presenting facts and figures to support your end goal, and that is to keep everyone safe so everyone goes home.

For more information, go to www.usfirepump.com

Bob Gliem

Bob Gliem is the Technical Director for US Fire Pump Company based in Louisiana USA and brings with him 30 years in the fire service, both municipal and industrial, most recently serving as Assistant Fire Chief for one of North America’s largest refineries. Bob has served as a Subject Matter Expert of foam firefighting and mobile fire apparatus and has instructed various agencies around the world. As a certified IFSAC Instructor III with numerous other national certifications, Bob conducts training and case studies for large water flow delivery and bulk storage emergencies.