PMMI’s OpX Leadership Network’s Capital Projects Solutions Group was formed to enhance communication among all stakeholders during commercial transactions involving capital equipment. The group’s objective is to achieve capital project excellence, minimize costly misunderstanding, and provide documents that adhere to good standard business practices and are fair to both parties.
“Detailed requests for proposals (RFPs) enable greater clarity of project requirements in commercial transactions involving capital equipment,” states Stephen Perry, managing director of the OpX Leadership Network.
For consumer packaged goods (CPG) companies, achieving vertical startups of packaging and processing equipment lines consistently and effectively are paramount. The new RFP Process Template for CPG Industry from the OpX Leadership Network provides greater understanding of project requirements, which results in better outcomes for all stakeholders involved in the process.
The level of detail and support required when using this template depends on the CPG’s business procedures and the complexity of the capital project. When using the template, CPGs should provide the bidder with a high-level abstract of the project, requirements, purpose and a detailed timeline. In addition, information such as insurance requirements, technical and validation specifications, special contract needs, site drawings, and safety standards should be included in the template. This information can be included in steps one to four of the RFP template.
More specific machinery requirements, product descriptions and expected machine performance levels are indicated in steps five through seven. Here, CPGs provide the quality, rate, validation and performance requirements as measured and acknowledged by the plant or facility operations team that will allow final payment and contract fulfillment criteria to be met by the equipment supplier.
“Total cost of ownership (TCO) is a foundational element of RFP and capital projects excellence as it illuminates true equipment costs by focusing in detail on both acquisition and operating costs,” notes Perry. “It’s a move away from a ‘price only’ approach to a more holistic ‘life cycle’ one to capital spend.”
To download a copy of the RFP Process Template for CPG Industry as well as the supporting RFP Checklist, visit www.opxleadershipnetwork.org. Other helpful tools at this site supporting the RFP process include the TCO Playbook and Checklists.
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