Name brand procurements versus sole source contracts

ProcurementMgmt_123770867.jpgLocal governments have the ability to specify a name brand during their procurement process. In these situations, the government should thoroughly document why only this specific manufacturer’s equipment is necessary to meet their operational needs, as well as why another manufacturer’s equipment could not substitute. This documentation should be maintained and periodically evaluated to ensure that the specific brand is still required.

For the procurement process, the local government should draft specifications of what they intend to purchase, and what specific brand is required. Based on the estimated cost of the purchase, the government would then follow applicable procurement processes.

It is important to note here that specifying a name brand during the procurement process is not the same as declaring a purchase sole source.

Sole source purchases are purchases that are clearly and legitimately limited to a single vendor. If an item (even a specific name brand) is available from more than one vendor, it is not appropriate to declare the purchase sole source.

If a sole source exception is used, meaning that the purchase is clearly and legitimately limited to a single vendor, the local government should still make reasonable efforts to ensure that it is receiving the lowest price and best terms from the vendor.

For audit purposes, documentation should be maintained for each step in the process, including the name brand specification, sole source evaluation and the bid law process followed by the local government.

If you have any questions regarding the difference between brand specification and sole source, please contact your local audit manager. You can find them here on our website.