Michigan State University Supplier Requirements
The Land-Grant Mission of Michigan State University (MSU) is now a “Global Grant” Vision for the 21st century. University Services Integrated Supply Chain Management is evolving in support of the university's vision. As performance requirements increase, it is our fiduciary responsibility to ensure the validity of every supply chain transaction.
What Every Supplier Needs to Know
A self-study instigated a new practice to uniformly transmit the requirements for doing business with MSU to all suppliers. Every supplier is accountable to meet the requirements. The practices outlined in this document are not new; they have been in effect and will be consistently enforced by all acquisition staff. Past “satisfactory” performance may not be a guarantee of acceptability in the future.
Suppliers who do not comply with the requirements may find limited future business with MSU, and may also experience late payment or non-payment. Three conditions in particular must be noted:
- Order fulfillment requires a corresponding Purchase Order or MSU Procurement Card.
- Prior written approval of University Services Purchasing is required for any changes in the delivered product or service.
- Invoice requirements must be satisfied to receive payment.
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Suppliers: Co-Guardians of the Public Trust
MSU commits to the highest standard of integrity and trusts suppliers to honor its business requirements with the same commitment. In return, suppliers will receive respect, fairness, and opportunities to build enduring relationships. MSU invites suppliers to join its strategic commitment to achieve global recognition as the leading land-grant research university for the 21st century! 1
In 1862, MSU served as the model on which the U.S. Congressional Morrill Act established the national system of land-grant colleges. President Abraham Lincoln signed the Morrill Act into law, stating: “The land-grant university system is being built on behalf of the people who have invested in these public institutions their hopes, their support and their confidence.” 2
Today, Lincoln’s words remain a clear expression of the public trust that must be upheld by individuals who act in the name of MSU. Suppliers entering into a business relationship with MSU become co-guardians of the public trust. The intent of these requirements is to enable every supplier to know and understand the standards by which the public “hopes . . . support, and . . . confidence” are best served.
1 - Simon, Lou Anna K. “Land-Grant University for the 21st Century”. boldnessbydesign.msu.edu . 2006.
2 - Luebker, Mark. “Land-grant mission remains focus of MSU”. newsroom.msu.edu/foundersday/2005/land_grant. 2/14/2007.
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Supplier Eligibility
All prospective suppliers are eligible to solicit business from MSU. MSU acquisition staff selects the suppliers who meet the supply requirements of each requisition processed for bidding or order placement. All else being equal, MSU buys American and supports Michigan industry. The Supplier Diversity Program supports businesses that are woman-owned, minority-owned, small, or otherwise disadvantaged.
New suppliers are invited to contact the Purchasing Department to schedule a meeting with the appropriate buyer. Following the meeting, suppliers are to complete the Supplier Information Form.
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Purchase Order (PO) Requirements
Purchases made by MSU require a Purchase Order or an MSU Procurement (Credit) Card. It is the supplier’s responsibility to obtain a valid Purchase Order. Potential suppliers should know that certain products may not be purchased with the MSU Procurement Card, and refrain from entering into those transactions.
Changes
Any change in the product or service provided by a supplier from that specified in the Purchase Order must be approved in writing by MSU Purchasing before the supplier provides the goods or services. Changes include but are not limited to description, quantity, price, or terms which differ from the original Purchase Order.
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Quotation Requirements
In addition to the purchase order, a bid process to seek multiple written quotations may be required. Payment discounts and freight terms will be used in determining the best value in the competitive bid process.
- Orders with an estimated value under $5,000 may be bid at the buyer’s discretion.
- Orders with an estimated value over $5,000 must be competitively bid.
Request for Quotation (RFQ)
An RFQ is a solicitation requesting price, terms, conditions, and service requirements where the estimated value is less than $50,000. The RFQ states the date the quotation must be returned to the Purchasing Department. Suppliers must submit quotations on or before the due date. Quotations received after the due date may not be honored. Information on how and where to submit a quotation is contained within the RFQ.
- Orders with an estimated value over $50,000 must undergo a Sealed Bid process.
Sealed Bids
Sealed Bids are solicited for acquisitions estimated at $50,000 or more. Sealed Bids are to be submitted at any time prior to the specified opening date and time. Telephone, e-mail, or facsimile responses are not accepted. Information on how and where to submit a sealed bid is contained within the RFQ.
Sealed Bid openings are open to the public. Recording devices of any kind are not permitted at bid openings. Late bids are not opened or considered.
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Payment Terms
Terms are “Net 30” of invoice date unless negotiated otherwise and confirmed in writing on the Purchase Order. If discounts are available, more expedient payment can be arranged.
Other Solicitations
- Request for Proposal (RFP)
An RFP requests information when services are being procured. Price is not the only deciding factor in service comparisons.
- Request for Information (RFI)
An RFI requests written information about the capability of a supplier to provide a specific product or service, or to obtain information about new technology. An RFI may be followed by an RFQ.
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Invoice Requirements
The invoice must reference only one (1) Purchase Order and must contain:
- A valid MSU Purchase Order (PO) number. This is to include all prefixes and the release number when applicable.
- The current name and “remit to” address of the supplier.
- Distinguishable, separately invoiced items, each with a description, price, and language matching the language and sequence of the PO.
- The freight bill number/tracking number.
Submit invoices by US Mail or Fax unless otherwise noted on the Purchase Order.
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Routing Requirements
Non-compliance with the following shipping instructions and those on the Purchase Order, resulting in a cost increase, may cause the cost differential to be deducted from the supplier invoice. Late payment or non-payment may occur as well.
Small Parcel
United Parcel Service and Federal Express Ground should be used for all parcel shipments to MSU. All parcel shipments are considered FOB Destination. The supplier is responsible for all carrier claims.
Utilization of Preferred LTL Carriers
MSU recognizes that historically, "Prepaid Freight" terms enabled the supplier to select the carrier. The present-day demands of supply chain management require MSU to maintain visibility of all inbound shipments to our receiving facilities and off-campus locations. Therefore, suppliers must utilize MSU-preferred LTL Carriers for "Prepaid Freight".
All shipments that weigh between 300 and 5000 pounds that are not delivered in supplier's own truck are to be shipped Less-Than-Truckload (LTL) using MSU-preferred carriers. Shipping terms are "Freight Collect".
MSU requires the utilization of the following preferred LTL Carriers:
MSU recognizes the need for expedited and special handling services.
Air Express Shipment Requirement
All parcel orders requiring air transport (individual package weight will not exceed 100 pounds) will ship “FedEx Air — Bill Recipient”.
Van Line Carriers Requirement
Suppliers will submit a transportation quotation to the MSU buyer for review and comparison. The quotation will include product dimensions, packaging, and handling requirements.
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Packaging Requirements
It is the responsibility of the supplier to ensure that proper packaging is used and that the contents of the package are adequately and securely packed, wrapped, and cushioned for transportation:
- All packages must display the MSU Purchase Order Number on the shipping label or the package itself. LTL shipments require the purchase order to be submitted on the carrier bill of lading.
- The weight of each carton shipped parcel carrier will not exceed 150 pounds.
- Use a strong container with all parts intact.
- Use box sealing tape designed for shipping.
- Remove all old labels, hazardous material indicators, and other shipment markings.
- Wrap items separately, using adequate cushioning material; protect items on top, bottom, and sidewalls of carton.
- Use environmentally compatible cushioning materials when feasible.
- Use a single address label that has a clear, complete return and delivery address.
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Hazardous Materials Packaging Requirement
It is the responsibility of the supplier to ensure compliance with the Code of Federal Regulations 49 (CFR 49) and packaging requirements governing hazardous materials. This includes proper identification, labeling, marking, packaging, and emergency response information.
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International Procurement Requirements
All international suppliers are required to submit a pro-forma invoice for review and validation. The pro-forma invoice must provide the following information:
- The name and address of the foreign shipper and/or manufacturer.
- The name and address of the importer of record and consignee.
- A full and accurate description of the imported merchandise; including the Harmonized Tariff number.
- Quantity of the merchandise being imported with net weights and measures included.
- The unit price of the imported commodity.
- INCO Terms 2000—DDU or DDP must appear on the commercial shipping invoice.
- Invoice date.
- Invoice number and purchase order.
- A detailed breakdown of any and all prepaid freight and insurance charges associated with the transaction of sale.
- All discounts offered and or taken.
- Any selling commissions must be detailed on the invoice.
- Invoice must be in English.
- A complete invoice value.
- Country of origin of the imported merchandise.
- A name of a “responsible person” as the preparation party of the invoice.
- A statement of commodity use.
- Confirmation of inbound gate and broker information detail.
- Type of Packaging (International Wood Packing Materials Regulations may apply).
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