What is a procurement plan, and how do you make one?
Short answer
A procurement plan is an organisation’s list of the purchases it expects to start in a coming period, usually one year, with each purchase’s value, method, dates and owner.
Key takeaways
- A procurement plan lists the purchases an organisation expects to start in a coming period, usually its financial year, with a description, an estimated value, a procurement method, key dates and an owner for each.
- It is not the procurement management plan of one project, nor the procurement strategy, which sets direction over several years. It turns the budget and the strategy into a timetable of purchases.
- Its most useful column is the start date, worked back from the date the goods or services are needed, minus the time the chosen method takes.
- Many public buyers must have one. Uganda requires an annual plan approved by the contracts committee; the Philippines forbids procurement outside the approved plan; UK public buyers that expect to spend more than £100 million in a year must publish a pipeline of contracts above £2 million.
- A plan is useful only if it is kept current. Update it when budgets or needs change, and compare what was started with what was planned.
What is a procurement plan?
A procurement plan is the list of purchases an organisation expects to start in a coming period, usually its financial year. For each purchase it gives what will be bought, the estimated value, the procurement method, the key dates and the person responsible. It turns the approved budget into a timetable for the procurement team.
A simple case. A town council approves its budget for next year. Its procurement plan shows twelve lines: re-tender street cleaning before the contract ends in September, buy six electric vans, renew the payroll software licence, hire a design firm for a new library, and so on. Each line has a value, a method such as an open tender or a quotation, a date to start and a named buyer. Nothing on the list surprises the procurement team in August.
Public bodies use several names for the same document: annual procurement plan, procurement pipeline, procurement forecast, or procurement activity plan. The Victorian Government’s buying guidance in Australia, for example, describes a procurement activity plan as the organisation’s anticipated procurement activity over 12 to 24 months.
Which procurement plan is meant: the organisation’s, a project’s or one purchase’s?
The words “procurement plan” are used for three different documents. Search results mix them, so check which one your organisation, funder or teacher means before you write.
| Document | Scope | Question it answers | Usual owner |
|---|---|---|---|
| Organisation’s procurement plan (this page) | All purchases starting in one period, usually a year | Which purchases start this year, when, and who runs them? | Procurement, with budget holders |
| Procurement management plan | The purchases of one project, for its life | What will this project buy, how and when? | The project manager, with procurement |
| Plan for one procurement | One significant purchase | How will we run this purchase, and why this way? | The buyer in charge of the purchase |
The organisation’s plan lists many purchases; the project and single-purchase plans go deeper into a few.
The project document is explained in what is a procurement management plan. The plan for one purchase is sometimes called a procurement business case or a tender strategy; Victoria’s guidance, for instance, uses it to record the need, the market analysis, the risks and the evaluation approach before going to market. A large project’s plan and the single-purchase plans feed lines into the organisation’s procurement plan.
Why do organisations make a procurement plan?
A procurement plan prevents the most common planning failure: a need that is known for months but starts too late, so the contract is extended or awarded without competition. It also helps in four other ways.
- It links buying to the budget. Each line has an estimated value and a budget line, so the plan shows early whether the money is there.
- It groups similar needs. Three departments that each plan to buy laptops can run one tender instead of three. Uganda’s planning regulations ask public bodies to aggregate requirements across user departments and over the year, and to group items that attract the same bidders.
- It sizes the procurement team’s work. Twenty tenders all starting in March cannot be run by two buyers; the plan shows the peak in advance.
- It warns suppliers. A published plan lets suppliers, small firms in particular, prepare for tenders. Victoria’s guidance notes that early awareness of future requirements matters most for small and medium-sized firms.
What does a procurement plan contain?
A procurement plan is usually a table with one row per purchase. A simple version fits in a spreadsheet such as Excel. The columns below cover what public rules ask for and what a procurement team needs to run the year. This guide does not offer a downloadable file yet; a procurement plan template is in preparation.
| Column | What to enter | Example |
|---|---|---|
| Reference | A unique number for the line | PP-2027-014 |
| Description | What will be bought, in plain words | Street cleaning services, whole town |
| Category | Goods, works or services, and the spend category | Services, facilities |
| Requesting department | Who needs it and holds the budget | Environment department |
| Estimated value | The total contract value, with taxes stated | £1.2 million over 4 years, excluding VAT |
| Budget line | Where the money comes from | Operating budget, cleaning |
| Procurement method | Open tender, quotations, framework call-off, direct award… | Open tender |
| Contract type | Fixed price, unit rates, framework… | Unit rates, 4-year term |
| Date needed | When the contract must start | 1 September 2027 |
| Start of procurement | When work must start, worked back from the date needed | 3 March 2027 |
| Key milestones | Notice, bids due, award, contract signature | Bids 15 April; award 15 June |
| Responsible buyer | The person who runs it | A. Mensah |
| Status | Planned, started, awarded, cancelled | Planned |
| Existing contract | The contract it replaces, if any, and its end date | C-2023-007, ends 31 August 2027 |
Value, method, date needed and start date are the columns that make a list into a plan; the others help you run it.
Public rules list similar fields. Uganda’s Procurement Planning Regulations 2023 ask each annual plan to state the supplies, works and services to be bought and their cost, the items to be bought in common with another public body, the resources required, the recommended method and time for each stage, the type of contract and, where relevant, maintenance and operating costs. The Philippines’ New Government Procurement Act lists the project name, the responsible unit, the description, the procurement method, the evaluation criteria, the timeline, the source of funds and the approved budget.
How do you make a procurement plan, step by step?
A procurement plan is built from the budget and the contract register, a few months before the financial year starts. The steps below work for a public body or a company.
- Collect the needs. Ask each budget holder what they must buy next year, with a rough value and the date they need it. In the Philippines, each end-user unit writes a project procurement management plan (PPMP), and the bids and awards committee’s secretariat consolidates these plans into the annual plan; elsewhere a short form is enough.
- Add contracts that end. Read the contract register for every contract that expires in the period or soon after. Each one is a line: renew, re-tender or stop.
- Group similar needs. Merge lines that buy the same thing or attract the same suppliers, and check whether an existing framework agreement can be used instead of a new tender.
- Choose the method. Apply your procurement policy: the value thresholds decide whether a line needs quotations, a tender or a framework call-off.
- Work back the start date. Take the date needed, subtract the time the method takes and a margin, and record the date the purchase must start.
- Check the workload and the budget. Count the lines per buyer and per month, move what can move, and confirm every line has funds.
- Approve and publish. Have the plan approved with the budget, then share it inside and, where rules or policy say so, publish it for suppliers.
- Review it every quarter. Add new needs, remove cancelled ones, and update dates and values.
The order matters: if the plan is written before the budget, it lists wishes; if it is written long after, purchases have already started late.
What does a procurement plan look like? A worked example
The table below shows five lines of a fictional town council’s plan. The lead times are the council’s own assumptions for each method, not legal minimums; replace them with your own figures.
| Purchase | Estimated value | Method | Lead time assumed | Date needed | Start procurement by |
|---|---|---|---|---|---|
| Street cleaning, 4 years | £1,200,000 | Open tender | 26 weeks | 1 Sep 2027 | 3 Mar 2027 |
| Six electric vans | £240,000 | Framework call-off | 12 weeks | 1 Jun 2027 | 9 Mar 2027 |
| Payroll software licence renewal | £60,000 | Direct renewal under existing contract | 8 weeks | 1 Apr 2027 | 4 Feb 2027 |
| Library design services | £180,000 | Open tender | 26 weeks | 1 Jan 2028 | 3 Jul 2027 |
| Office furniture | £35,000 | Three written quotations | 6 weeks | 1 May 2027 | 20 Mar 2027 |
Each start date is the date needed minus the lead time: 1 September 2027 minus 26 weeks is 3 March 2027.
Two lines start in early March. If one buyer runs both, the plan shows the clash four months ahead, and the van call-off can move to February. Without the plan, the clash would appear only when both requests arrive in the same week.
What do public procurement rules require?
Many public bodies must plan, approve or publish their purchases. The rules differ in who must act, what is covered and whether the plan is published. The table shows six examples; check the current text of the rules that apply to you.
| Jurisdiction and rule | Who | What is required |
|---|---|---|
| United Kingdom: Procurement Act 2023, section 93 | Contracting authorities under the Act (not devolved Scottish authorities, which follow Scottish rules) expecting to pay more than £100 million under relevant contracts in the coming financial year | A pipeline notice of public contracts above £2 million they intend to advertise in the next 18 months, published within 56 days of the start of the financial year |
| Scotland: Procurement Reform (Scotland) Act 2014, section 18 | Authorities that must have a procurement strategy | An annual procurement report that includes a summary of the regulated procurements expected to start in the next two financial years |
| Uganda: Procurement Planning Regulations 2023 | Every procuring and disposing entity | An annual procurement plan for each financial year, multi-year plans for procurements longer than a year, updates approved by the contracts committee |
| Philippines: Republic Act No. 12009, section 7 | Every procuring entity | An Annual Procurement Plan with set contents; no government procurement unless it is in the approved or indicative plan |
| United States: 15 U.S.C. 637(a)(12)(C) | Federal agencies above a contracting volume set in 1988 dollars | A yearly forecast of expected contract opportunities that small businesses can perform, updated periodically; OMB asked for quarterly updates in 2024 |
| Victoria, Australia: Buying for Victoria guidance | Organisations under the board’s goods and services policies | A procurement activity plan covering 12 to 24 months, posted on the organisation’s website and reviewed each year |
Where publication is required, the plan becomes a promise to the market, so keep it current.
The US forecast shows what a published plan line can hold. A memorandum from the Office of Federal Procurement Policy of 29 November 2024 asks agencies to use common fields, among them a title, a description, the existing contract number, the contracting office, the place of performance, the NAICS code, an estimated value range, the expected set-aside, the contract type, the fiscal year and quarter of the solicitation, the expected start of performance and a point of contact. Fields not yet known are marked “to be determined”.
How is a procurement plan different from a procurement strategy, a strategic plan and a category plan?
A procurement strategy, sometimes called a procurement strategic plan, says where buying should go over several years and why. The procurement plan says which purchases start this year. A category plan says how the strategy for one group of goods or services will be delivered. The plan is the most concrete of the three.
| Document | Time frame | Example line |
|---|---|---|
| Procurement strategy (strategic plan) | Several years, reviewed each year | “Put 80% of spend under contract within three years.” |
| Category plan | Per category, updated as projects run | “Laptops: one framework, two suppliers, tender in Q2.” |
| Procurement plan | One year, sometimes 18 to 24 months | “Laptop framework tender: start 1 April, award 30 June, buyer J. Ortiz.” |
The strategy and category plans decide what to do; the procurement plan schedules it.
UK central government uses the same layers in its commercial standard, GovS 008: a commercial strategy and plan, category strategies, category plans that define how each category strategy is delivered, and a commercial pipeline that gives an ongoing view of commercial activity. How to build the strategy is explained in what is a procurement strategy; how categories are planned is covered in category management.
How do you keep a procurement plan current?
A procurement plan goes out of date within weeks: a grant arrives, a supplier fails, a project is cut. Treat it as a live document, with a named owner and a fixed review date.
- Update on a schedule. A quarterly review is common; the US federal guidance asks agencies for new forecasts at least quarterly. Uganda lets the procurement unit update the plan at any time in the year, with each update approved by the contracts committee.
- Record every change. Keep the approved version and each revision with its date and reason, so that a line added in a hurry can be explained later.
- Treat unplanned purchases as exceptions. A request that is not on the plan should need a reason and an approval. Some rules go further: in the Philippines, no government procurement may take place unless it is in the approved plan.
- Measure plan against actual. At year end, count how many planned purchases started on time, how many were added late and how many were dropped. The procurement KPI guide explains how to set such measures.
Questions
Who prepares the procurement plan?
The procurement team usually prepares and consolidates it, but the needs come from budget holders and department heads. Finance checks the values against the budget. Senior management, a board or, in some public bodies, a contracts or tender committee approves it. Each line then has a named buyer who runs the purchase.
Is a procurement plan mandatory?
For many public bodies, yes, under national or state rules such as those of Uganda and the Philippines, or in the form of a published pipeline or forecast in the UK and the US federal government. Private companies have no legal duty, but most large ones plan major purchases each year with the budget, because late tenders cost money.
Is a procurement plan the same as a procurement management plan?
No. A procurement management plan covers one project: what it will buy, how and when, and how its suppliers will be managed. A procurement plan covers the whole organisation’s purchases for a period. A large project’s procurement management plan feeds lines into the organisation’s procurement plan.
Can you make a simple procurement plan in Excel?
Yes. A spreadsheet with one row per purchase and the columns described on this page is enough for most organisations: reference, description, value, method, date needed, start date, buyer and status. Add filters by month and by buyer to see the workload. Larger organisations often move the plan into their procurement or e-tendering software so that each line can start a sourcing event.
Can an organisation buy something that is not in its procurement plan?
It depends on the rules. Many organisations allow it with a reason and an approval, and then update the plan. Some public rules are stricter: in the Philippines, government procurement may not take place unless it is in the approved annual or indicative plan, so the plan must be revised first.
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