Procurement involves two key stakeholders, the supplier and the customer (user). Understanding what the customer requires understanding their needs so we can create the procurement specification. Similarly, we need to research whether the market can meet those needs.

Understanding the supplier requires market research. Market research is a crucial component of the procurement process, as it helps Ministries identify potential suppliers and make informed procurement decisions. By conducting market research, Ministries can gather information on supplier capabilities, prices, quality standards, and delivery times. In this blog, we will discuss the key steps to follow and the models that can be used for market research in procurement.

Step 1: Identify the research objectives

Before conducting any market research, it is essential to clearly define the research objectives. This involves identifying the specific information that the Ministry needs to make informed purchasing decisions. The research objectives should be aligned with the overall procurement strategy and should consider the needs of the organization.

 Step 2: Gather information

Once the research objectives have been identified, the next step is to gather information. This involves collecting data from a variety of sources, such as industry reports, supplier websites, trade shows, and government databases. The information should be organized in a systematic manner to facilitate analysis.

 Step 3: Analyze the information

After gathering the information, it is important to analyze it to identify patterns and trends. This involves comparing prices, quality standards, delivery times, and other factors across different suppliers. Ministries should also consider the reputation of the suppliers and their ability to meet the organization's requirements.

 Step 4: Evaluate the results

The final step in the market research process is to evaluate the results and draw conclusions. Ministries should use the information gathered to identify potential suppliers and make informed purchasing decisions.

How do we analyse information gathered from Market research

 There are several models that can be used for market research in procurement. Here are some of the most commonly used models at teh Fiji procurememt Office:

Porter's Five Forces Model

This model is widely used at Fiji Procurement Office. This model analyzes the competitive forces within an industry, including the bargaining power of suppliers, the threat of new entrants, the bargaining power of Ministries, the threat of substitute products, and the intensity of rivalry among existing competitors. By analyzing these forces, Ministries can gain a better understanding of the competitive landscape and identify potential suppliers.

SWOT Analysis

This model analyzes the strengths, weaknesses, opportunities, and threats of potential suppliers. By identifying the strengths and weaknesses of each supplier, Ministries can make informed decisions about which supplier to choose. They can also identify potential opportunities and threats in the market that may affect their purchasing decisions.

PEST Analysis

This model analyzes the political, economic, social, and technological factors that may affect the market. By analyzing these factors, Ministries can gain a better understanding of the market and identify potential suppliers that are best suited to meet their needs.

Market research is a critical component of the procurement process. By following the key steps and using the appropriate models, Ministries can gather information, analyze it, and make informed purchasing decisions. By doing so, they can ensure that they are getting the best value for their organization and are meeting their procurement objectives.