"Framework agreement" means an agreement entered
into between a buyer and one or more suppliers, contractors
or service providers, and which is intended to determine the
terms and conditions of contracts to be awarded over a given
period, particularly in terms of prices and envisaged volume,
if appropriate. Framework agreements are unilaterally binding.
Mutual commitment is not effective till call-off.
"Framework contract" means an agreement as defined
above, with the exception that the buyer
has a duty to use the contracted supplier, contractor or service
provider whenever a need
arises for the deliveries defined in the said contract. Final
commitment is not made till call-off.
Goods and services
"Goods" means deliveries of products, equipment
"Services" means deliveries of which work constitute
a major part, as well as immaterial assistance.
Life Cycle Cost - LCC
The "life cycle cost" of a product (or project,
object etc.) means the present value of the cash flow for
the product's total costs over its planned or actual life.
Integrated supply chain management
"Integrated supply chain management" implements
a co-ordinated total supply chain, including first, second
and third tier suppliers. It is the synchronised integration
and management of the entire supply chain that transforms
the supply chain from a loosely linked group of independent
businesses into a single, integrated competitive system with
sustainable competitive advantage over competing supply chains.
"Procurement" means the entire process of planning,
organising, co-ordinating, controlling and
monitoring the provision of goods and services.
"Procurement Unit" means the organisational unit
which has been assigned the tasks of planning,
organising, co-ordinating, controlling and monitoring the
procurement of goods and services required by the company.
"Strategy" means, in this connection, the process
of establishing an approach to achieve an objective. This
involves the utilisation of all expertise and resources available
in the procurement process and the entire supply chain to
ensure the generation of competitive advantage.
"Supply chain" means the connected series of organisations,
resources and activities involved in the creation and delivery
of value, both finished products and services, to end consumers.
The "total value" of a procurement means the procurement's
total tender or contract value, inclusive of any options and