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May 12, 2025

LSTK vs LSPB: Choosing the Right Contract Model

Selecting the right contracting strategy is crucial to managing project risk, scope, and value in infrastructure and industrial projects.

1. Scope Responsibility

LSTK includes design, procurement, and construction; LSPB excludes design and focuses solely on procurement and construction deliverables.

2. Risk Allocation

LSTK transfers most project risk to the contractor; LSPB shares more risk with the client, especially during the design stage.

3. Client Involvement

LSTK reduces client input post-award; LSPB requires client oversight and coordination during the design-to-procure interface phase.

4. Delivery Flexibility

LSTK offers a single point of accountability; LSPB allows more control and flexibility, especially when design is client-driven or evolving.

May 12, 2025

Transactional vs Strategic: Understanding the Procurement Shift

Knowing the difference empowers professionals to move from reactive buying to value-driven, business-aligned procurement practices.

1. Time Horizon

Transactional purchasing focuses on immediate needs, while strategic procurement plans for long-term goals and sustained business performance across years.

2. Supplier Relationship

Transactional views suppliers as interchangeable vendors, whereas strategic procurement fosters collaboration, innovation, and mutual growth through long-term partnerships.

3. Focus Area

Transactional decisions emphasize price and speed; strategic procurement evaluates value, quality, risk, and lifecycle cost to optimize outcomes.

4. Decision Drivers

Transactional reacts to internal requests, but strategic procurement anticipates needs and aligns sourcing strategies with company-wide goals and priorities.

5. Role in Business

Transactional supports operations tactically; strategic procurement is a business enabler driving innovation, resilience, cost leadership, and competitive advantage.

May 8, 2025

5-step Project Tendering Workflow – Procumart

Procurement Tendering, Project Workflow

A clear tendering workflow ensures fairness, transparency, and value for money. Here are 5 structured steps in a successful project tendering process:

1. Define Project Requirements

Develop a detailed scope, objectives, and budget. Align specifications with stakeholder expectations and project delivery outcomes to attract the right bidders.

2. Prepare Tender Documents

Draft clear RFTs including scope, timelines, criteria, and conditions.

3. Advertise and Invite Bids

Reach out to prequalified or open-market suppliers to ensure competitiveness.

4. Evaluate and Select Supplier

Assess bids objectively against pre-set criteria and evaluation matrix.

5. Award Contract and Mobilize

Finalize contract terms and ensure smooth transition into execution.

Structured tendering is the foundation of procurement excellence and project success.

#TenderingProcess #ProcurementWorkflow #ContractManagement #ProjectDelivery #CIPS #Procumart #Australia #Melbourne

April 30, 2025

Procurement Transformation Starts at the Core

Before we talk about supplier innovation, value creation, or strategic partnerships—we must get the basics right.

Too often, organizations aim for high-level procurement outcomes while skipping the foundational step: Tactical Procurement. This is where we build control, visibility, and compliance into the system. It’s where we master the “how” of buying before attempting to influence the “why.”

The journey from tactical to value-driven procurement is not about skipping stages—it’s about evolving deliberately:

Start with structured processes and policies Mature into data-driven sourcing, risk, and supplier management Then align procurement with enterprise value, sustainability, and innovation

Without a strong tactical foundation, the strategy won’t stick—and value will remain aspirational.

Where are you on this journey?

#Procurement #Procumart #ProcurementTransformation #ValueDrivenProcurement #CIPS #StrategicSourcing #SpendManagement #Leadership #Contracts #SupplyChain

April 30, 2025

Warranty vs Indemnity – Know the Difference in Your Contracts

A warranty (not to be confused with a guarantee) is a contractual promise or assurance that a certain fact or condition is true. For example, a supplier might warrant that goods meet specific standards or are free from defects.

If the warranty is breached, the injured party can seek damages—but under common law, the compensation is often limited and may be significantly less than the actual loss suffered.

In contrast, an indemnity is a contractual obligation to compensate for loss or damage incurred. It typically allows the injured party to recover the full amount of the loss, without the need to prove it under strict common law rules.

Understanding this difference can be the key to effective risk management in commercial contracts.