The Buyout process of a Project can occur while a Project is in Request, Proposal, or In Progress status, but happens most frequently during the In Progress status of a Project, once a contract has been awarded.
The Buyout tab allows you to issue any of your standard Commitments to Vendors, such as Subcontract Agreements and Purchase Orders, as well as Commitments to Employees, such as Labor Authorization and Expense Authorizations. This article describes the process of creating, issuing, and executing Vendor Commitments.
Buyout Commitments are contracts used to purchase services and/or materials for a job. In Construction these are most commonly known as Purchase Orders and Task Orders. RedTeam has a feature that allows you to create custom Commitments including, but not limited to, P.O.s and T.O.s.
1. Create a Vendor Buyout Commitment
Subcontract Agreements, Purchase Orders, Subcontracts, Task Orders, and any other forms of commitment to purchase goods or services are referred to as Buyout Commitments in RedTeam. Your company can have as many forms of commitment as you need, and they are set up in the Configuration menu. Buyout Commitments are typically issued once you have signed and executed a formal contract with your Customer; however you can begin drafting them in RedTeam as soon as a Project is in Request status.
In addition to Commitments that are issued to your Vendors and subcontractors, you can issue Commitments to your employees to authorize and commit time and expenses on the Project. For more information on creating these employee Commitments, see the article "Understanding Expense and Labor Authorizations."
Steps:
From the Project's home menu, click "Vendor Commitments" OR navigate to the project's Buyout tab
Click the New icon (+)
Select a Commitment Template from the list (in this example, we will create a Subcontract)
In Step 1, search and select the vendor from the dropdown or add a new Vendor
(Optional) If the vendor has a quote that has been created (either single quote or bid package) on this project, the information will populate. If the commitment that is being created is related to the quote, you can click the checkbox to include it in this commitment & close the quote. Bid packages can be selected in as many commitments that are related to it and all items will load to Step 3 Products and Services for review and editing.
In Step 2, enter the required contract terms, such as cost code, payment terms, bill to, etc.
In Step 3, outline the scope of the contract by adding items to the Commitment
In Step 4, (optional) verify the vendor's required credentials, or add additional from the dropdown
In Step 5, (optional) click "Add" to add any Submittal items you require from this Vendor
In Step 6, add any attachments you would like to include with the Commitment
In Step 7, review the Confirmation details and click "View Commitment" to review your Commitment
Considerations:
You may not create a new Task Order if a Task Order for the same Vendor already exists and is listed in Draft, Committed, or Executed status. You must close or cancel the Task Order before creating a new one for the Vendor. To close a Task Order, edit the T.O. and select Closed or Cancelled from the status dropdown in Step 2.
Required credentials must be on file for the Vendor before a Buyout Commitment can be committed.
2. Products and Services
The Products and Services area of a Buyout Commitment is where the information is entered for the services or deliverables specific to each project and commitment. This can be used as a “Scope of Work”, “Items to be delivered”, or any other number of options, according to how the document is to be used and how it is set up in Configuration.
Items can be added to the Products and Services either manually one at a time or via the import items option. When adding items manually, you can create brand new items or select them from the available inventory items from the current project. If creating a new product or service item, an item title and description can be added. The item description area allows text editing and formatting directly in the text box or information can be pasted from a word processor program and RedTeam will keep the formatting. If adding items from inventory, the information will auto populate from what was created in the inventory items, but the information that is populated can be edited.
According to how the Buyout Commitment is configured you can enter Quantity, U/M (Unit of Measure), Unit Price, and check if the item is Taxable. The Quantity field will only be available if the option to calculate based on Unit Quantity and Unit Price is checked.
Steps:
Access the "Buyout" Tab
Create or Edit a Commitment
Fill out information until on "Step 3. Products & Services"
Click the “Add Items” button
Select if item is new or an inventory item
If using an Inventory Item select the applicable one
Enter the appropriate “Title” in the Title field
Add a description or paste a description into the field. The description box can also be expanded by clicking the “Expand” button
Select a “Unit of Measure”, which will populate options that have been added to Configuration
Checkmark the box if the item is Taxable
To complete the creation of the product or service, click “Save" or “Save and New” to save this item and enter a new one
3. Edit a Buyout Commitment
Sometimes information is entered incorrectly or changes are made to a Buyout Commitment and the information must be altered. Note that any information may be changed in a commitment that is still in draft status and has not been committed. Once committed, the contract terms may not be changed, but Step 8 (Source) will become available. See "Upload Returned Buyout Commitment" article for more information.
Steps:
Access the "Buyout" Tab
Locate the commitment in the list of Buyout Commitments
Click the tools icon
Click "Edit"
Navigate through steps 1-7 and make changes
In Step 7, review the commitment summary and click "Confirm" to save
Considerations:
Edit Buyout Commitments to:
Makes changes to Commitment details
Upload the returned Buyout Commitment from the Vendor
Change a Task Order status so new Task orders may be issued for the same Vendor
4. View a Buyout Commitment
The View option lets users see the completed Buyout Commitment as it will look when issued to the Vendor. If the Commitment is in draft status (green) and has not been committed, the document will appear with a "DRAFT" watermark when viewed. Commit the Buyout Commitment to remove this mark and "Issue a Buyout Commitment." You may also view a preview of your Commitment by clicking "View Commitment" in Step 5 (Confirmation) after it has been created or edited.
Steps:
Access the "Buyout" Tab
Locate the commitment in the list of Buyout Commitments
Click the tools icon
Click "View"
5. Commit a Buyout Commitment
Once a Buyout Commitment has been successfully created and reviewed, it may be committed. Committing will authorize it and contract terms will no longer be available to be edited. It also may not be deleted. Draft buyout commitments appear green in the list of commitments. After committing, they will appear blue. Once committed, Step 8 (Source) will become available and allow users to upload the signed and returned Commitment from the Vendor.
If you do not have the option to Commit a Buyout Commitment (the option is grayed out), first click "Edit" and check the Verify Credentials step. If there are Credentials missing or expired, most likely your company settings do not allow the document to be Committed until the Credentials are all loaded and up to date. To check your company's settings, go to the Configuration menu > Commitment Forms and Edit the Commitment to view the settings.
Steps:
Access the "Buyout" Tab
Locate the commitment in the list of Buyout Commitments
Click the tools icon
Click "Commit"
6. Delete a Buyout Commitment
Only Draft (green) Buyout Commitments may be deleted. Committed (blue) and Executed (black) Commitments cannot be deleted, unless first uncommitted. If you cannot uncommit, see an administrator for the appropriate permissions.
Steps:
Access the "Buyout" Tab
Locate the Draft (green) Commitment in the list of Buyout Commitments
Click the tools icon
Click "Delete"
7. Execute and Upload a Signed Commitment
Once a Buyout Commitment (subcontract, purcase order, etc.) has been created, committed, and issued to the Vendor, it will be reviewed by the Vendor, signed and returned. This returned document can now be scanned and uploaded as an attachment to the original Buyout Commitment in RedTeam. To upload the document, the original Commitment must be in a committed status (blue).
If you do not have the ability to Execute a Commitment, your Commitment has likely been Configured to require all Vendor Credentials required for this particular Commitment are on file and up to date. To verify, Edit the Commitment and go to Step 4.
Steps:
Access the "Buyout" Tab
Locate the Commitment in the list of Buyout Commitments
Click the tools icon
Under the Change Status option, select "Execute"
In Step 8, change the status to Executed (if Executed is not available, go to Step 4 to Verify Credentials)
Click the "Add Files" button to browse your computer or drag & drop the source file into the upload box
Click "Start Upload" to upload the source file (signed commitment)
Click "Close" once you have finished uploading and the commitment is to be executed.
