Purchasing Methods & Procedures

For U Faculty & Staff

All units across the University of Minnesota system are encouraged to adopt U Market as their primary method of supply purchasing.  U Market has guaranteed contract pricing, electronic invoicing, and is the most cost effective purchasing process.  U Market is a key component of the University of Minnesota’s strategic sourcing and an important part of the overall approach to Operational Excellence. Download a quick visual summary of how departments may purchase the most common goods and services. (pdf)

Purchasing Methods:

  1. Start with U Market.  This is the least expensive overall process.
  2. Use a standard purchase order with a reputable supplier.
  3. Use the University’s PCard with a reputable supplier (this is one of the most expensive processes, overall).
  4. For emergencies only, purchase with personal funds and seek reimbursement (this is the most expensive process when all costs are taken into account).
  5. Do NOT sign or agree to the supplier’s Terms and Conditions. Because the University is a constitutional function of the State of Minnesota, certain laws and regulations apply to our contracts that do not apply to other customers, so insist on using the University’s Terms and Conditions. Additional information about contracts can be found in the University’s Policy on Entering into Contracts.

The University uses the following methods for departmental purchasing:

  1. U Market
  2. Purchase Order (PO)
  3. Procurement Card (PCard)
  4. Internal Sales Purchases
  5. Non-PO Related Payment

While faculty and staff are expected to use the U Market purchasing method whenever possible, there may be situations where another purchasing method is more appropriate. Regardless of method, do NOT sign or agree to the supplier’s Terms and Conditions. Because the University is a constitutional function of the State of Minnesota, certain laws and regulations apply to our contracts that do not apply to other customers, so insist on using the University’s Terms and Conditions. Additional information about contracts can be found in the University’s Policy on Entering into Contracts.

University Purchasing Methods Matrix | pdf |

Refer to the following tables for information about the purchasing thresholds from any of these commodities. For additional information on each commodity or the procurements requirements involved within each commodity/dollar threshold, refer to the drop down menus below.

Standard Goods and Services

$0 to $9,999 $10,000 to $49,999 $50,000 to $249,999 $250,000 and over $1,000,000 and over
Departments may purchase from a reputable supplier.
If not being purchased from U Market, Pre-Paid Debit Card, or ISO, a Price & Supplier Justification Form must be completed to document the basis for supplier selection and proof of reasonable price.
For purchases not from U Market or on a U-Wide Agreement, departments must utilize Purchasing Services to complete a competitive process to select a supplier. Departments must utilize Purchasing Services to complete a competitive process to select a supplier.
Board of Regents policy requires that individual purchases and contracts valued at $1,000,000 and over be presented to the Regents for approval after the bid/proposal process has been completed and prior to making the purchase or contract.

Professional Services (CPS)

$0 to $2,999 $3,000 to $49,999 $50,000 to $249,999 $250,000 and over $1,000,000 and over
Create a non PO-related voucher (preferred); OR a Quick Contract for Professional Services or a Performance Contract for Professional Services (PCPS).
Department must create a Quick Contract for Professional Services (QCPS) or a Performance Contract for Professional Services (PCPS).
For purchases not from U Market or on a U-Wide Agreement, departments must utilize Purchasing Services to complete a competitive process to select a supplier. Departments must utilize Purchasing Services to complete a competitive process to select a supplier.
Board of Regents policy requires that individual purchases and contracts valued at $1,000,000 and over be presented to the Regents for approval after the bid/proposal process has been completed and prior to making the purchase or contract.

Construction Services

$0 to $249,999 $250,000 and over $1,000,000 and over
Departments must utilize Capital Project Management or U Construction to begin the contract phase. Departments must utilize Purchasing Services to complete a competitive process to select a contractor.
Board of Regents policy requires that individual purchases and contracts valued at $1,000,000 and over be presented to the Regents for approval after the bid/proposal process has been completed and prior to making the purchase or contract.

Architecture & Engineering (A&E) Services

$0 to $99,999 $100,000 to $199,999 $200,000 and over $1,000,000 and over
Departments must utilize Capital Project Management or U Construction to begin the contract phase. Departments must utilize Purchasing Services to complete a competitive process to select an A&E firm. Departments must utilize Purchasing Services to complete a competitive process to select an A&E firm. For state-funded project, departments must utilize the State Designer Selection Board procurement process.
Board of Regents policy requires that individual purchases and contracts valued at $1,000,000 and over be presented to the Regents for approval after the bid/proposal process has been completed and prior to making the purchase or contract.

Entering Into Contracts

Departments can sign/execute contracts if the term is for "time frame and/or dollar amount".

Departments should contact the Office of General Counsel (OGC).

Administrative Policy: Entering Into Contracts

Administrative Procedure: Administering Contract for the Purchase of Goods and Services

Obtaining professional services requires a contractual relationship with an individual, partnership or corporation. Professional services typically contain at least one of the following criteria:

  • Specific skillset or expertise is needed
  • Service is customized to meet your department's needs
  • The services are NOT routinely available to the public at a standard rate or price
  • Rate or price is negotiated with the supplier

To ensure both parties agree to the price, expected deliverables, and timeframe to complete the work, all professional services totaling $3,000 or greater require a contract/Purchase Order (PO). Per policy, work cannot begin until the contract is fully approved in the Enterprise Financial System (EFS) and the contract’s start date has occurred.

Depending upon the type of professional service and total dollar amount, there are four possible types of professional services transactions that will be created in EFS. Since each situation is unique and the University must be in compliance with various state and federal regulations, most professional services require forms to be attached with their EFS requisition or purchase order.

Below is a grid that describes which type of transaction and forms are required when purchasing a professional service. Regardless of whichever transaction type you use, do NOT sign or agree to the supplier’s Terms and Conditions. Because the University is a constitutional function of the State of Minnesota, certain laws and regulations apply to our contracts that do not apply to other customers, so insist on using the University’s Terms and Conditions. Additional information about contracts can be found in the University’s Policy on Entering into Contracts.

You can also access our at-a-glance reference guide that identifies the required supporting documentation needed when purchasing professional services.

Transaction Type Transaction Total's Threshold Range Contract Information Required Forms or Documents
Non PO-related voucher Less than $3,000 This transaction generates a payment to the supplier. It is NOT a legally binding contract.
Quick Contract for Professional Services (QCPS) $0 - $49,999.99 The QCPS is a binding contract between the supplier and University.
Contract for Professional Services (CPS) $50,000 and greater The CPS is a binding contract between the supplier and University.
Quick Performance Contract for Professional Services (QPCPS) $0 - $49,999.99 (and uses a performer-related category) The QPCPS is a binding contract between the supplier and University. Departments must include the Performance Agreement (also a legal contract) as an attachment.
Performance Contract for Professional Services (PCPS) $50,000 and greater (and uses a performer-related category) The PCPS is a binding contract between the supplier and University. Departments must include the Performance Agreement, which is the actual legal contract, as an attachment.

University departments interested in purchasing A&E and construction services from an outside supplier should do the following:

  1. Complete the Project Request Form to document and assign a University team (from UServices or Capital Planning & Project Management) to the Project.
  2. Work with the assigned University team to procure a supplier to complete the work. The procurement method will vary based on the value of the contract. Refer to the Purchasing Thresholds table above to get a better idea of the various procurement options available. If the dollar threshold requires the department to utilize Purchasing Services to complete a competitive process to select a supplier, the requester should first complete an RFP Planning Document prior to contacting Purchasing.
  3. Once a supplier has been selected, submit a Purchase Order (PO) request to Purchasing. Your PO request must include the following attachment:
    1. For A&E Services: A fully executed AIA Contract that has been issued by Capital Planning & Project Management
    2. For Construction Services: Construction Contract Award Memo
  4. Once the PO request is approved, Purchasing will issue the PO to the supplier.

Purchasing goods and services with a total value of $50,000 or more is subject to University polices which require an open and competitive bid process (see "RFx" below). Purchasing Services will collaborate with end users and provide guidance to ensure the University’s needs are met at the lowest possible cost under the most advantageous terms and conditions available.

RFx Phase Overview

Define
  • Contact Purchasing Services for assistance before you begin.
  • Determine the type of RFx needed.
    • Request for Bid (RFB): Defined requirements and specifications; award to bidder with lowest cost.
    • Request for Proposal (RFP): General idea with some specifications and/or it's a large, complex project with potential for multiple solicitations; award based on evaluation criteria. Note: it is especially important to carefully define evaluation criteria. Changing or adding to them after the RFP is published is difficult. We recommend you complete the RFP Planning Document to help in the creation of the RFP.
  • Create evaluation committee (for RFP).
    • This committee will help gather requirements and define specifications, draft the RFP and evaluate RFP responses.
  • Gather requirements/specifications for goods and/or services.
    • What do you need?
  • Create requisition in EFS.
    • The requisition is need to create the RFx number used to issue the RFx in the University's electronic bidding tool - MBid.
  • Draft RFx.
    • Category Manager in Purchasing Services creates a draft in MBid; Department reviews final draft.
Publish & Invite
  • RFx is issued electronically through MBid by Category Manager.
  • Pre-bid meeting for suppliers (if needed).
    • If a walk-through is needed or the request is particularly complex, a bidder's conference is sometimes useful to provide information to and answer questions from suppliers.
  • Prospective suppliers submit questions based on information in the RFx.
    • Questions are received by the Category Manager and answered by Department/Evaluation Team.
  • Interested suppliers submit RFx in MBid by closing date.
    • Category Manager collates responses and sends to Evaluation Team for review.
Analyze & Select
  • Evaluation.
    • Based solely on Evaluation Criteria you have previously established and included in the RFP, the Evaluation Team evaluates and scores responses.
  • Recommendations for award from committee.
    • Evaluation Team makes recommendation based on scoring and submits to Category Manager for review.
  • Contract negotiations.
    • Category Manger works with Business Owner and, if necessary, Office of General Counsel to negotiate the best contract for the University.
  • Allow additional time to obtain Board of Regents approval if the contract is $1,000,000 or greater.
  • Purchase Order is issued.

Exception to Bypass the Competitive Purchasing Process

Requests for exception to the competitive process, such as sole source (only known source or a proprietary source) or single source (only one qualified supplier or acceptable product/service) purchases must be requested in writing from the initiating department. All requests for sole source and single source purchases must include detailed, objective and technical justification outlining the rationale for exception to the competitive bid process. 

NOTE:  All single and sole source requests must be submitted and approved by the Purchasing Department before goods or services are acquired.

The Purchasing Department will evaluate all requests for exception to the competitive bid process and will make the final determination as to whether or not a sole/single source purchase is acceptable. Once a sole source or single source purchase request is approved, a supplier quotation/proposal will be solicited by the Purchasing Department to establish contract pricing with mutually agreeable terms and conditions.

  • Form: Department Request for Exception to Board of Regents Policy (UM 1721)   | docx |
  • Regents Docket Information

    Regents Policy requires that individual purchases and contracts valued at $1,000,000 and over be presented to the Regents for approval after the bid/proposal process has been completed and prior to making the purchase or contract.

    Board of Regents Purchasing Policy

    The policies of the Board of Regents are umbrella policies that provide the framework under which the administration is responsible for implementation of and compliance with the intent of the board policy.

    Link to Board of Regents Policies

    Link to Board of Regents Purchasing Policy

    Required Documents

    The following documents are required to be reviewed by Purchasing Services before they are signed and the originals are delivered to Purchasing Services according to the Monthly Docket Schedule.

    Regents Summary

    A Regents Summary is a one-page document that explains what is being purchased and why. This documents contains the following information:

    • Supplier
    • Dollar amount of award
    • Items or services being purchased
    • Department requesting the purchase
    • Any contractual time frame
    • Background and support information
    • Process for selecting supplier
    • Source of funds for the purchase

    Form: Regents Summary Example | pdf |

    Form: Regents Summary Template | docx |

    Purchase Consent Record (PCR)

    To get Regents approval, departments must submit a Purchase Consent Record to Purchasing Services.  This document provides documentation of what is being purchased and that appropriate reviews and approvals have been received prior to the President’s requesting approval from the Board.  Deans, Directors, and Department Heads are responsible for ensuring that the Purchase Consent Records is completed in a timely manner and that appropriate signature approvals are obtained.

    Form: Purchase Consent Record | pdf | docx |

    Monthly Docket Schedule

    View this time table for draft and final deadlines for submitting Purchase Consent Records to Purchasing Services.  Missing the deadline may delay the Regents’ approval to the next monthly meeting.  Note that several times a year the Regents do not meet during the month.

    Monthly Docket Schedule | Google Doc |

    Link to Board of Regents Website

    When buying equipment for laboratories, there are additional things you need to think about. U Services/Facilities Management has prepared a special web page with facilities-related considerations for these purchases. Additional planning may be needed because specialized research equipment is often not formally tested and validated to meet American safety standards, and installation may require unplanned infrastructure improvements like improved electrical service, HVAC capacity, etc.