1. Call for competition process

2. Call for Competition Call for Competition Type
Annual Spending ≥ RMB 20M • Decision made by tender committee
• To involve suppliers from market • Any exception need to be validated by sourcing strategy
Call for Tender
Annual Spending ≥ RMB 200K • Decision made by project team • Can involve suppliers from market if no enough suppliers in the existing vendor pool
Bidding

3. Call for tender process

4. Propose Pitch & Develop Mock-up
Call for Tender Role & Responsibility
Initiate
Request
Sourcing New Supplier
Propose Pitch & Develop Mock-up
Supplier
Selection
Awards
Tender Committee
Purchasing A A A C A R R R R A R A
Accountable: Decision maker who has the final say. R
Responsible: The process owner who is Responsible to delivery C
Consulted: Other stakeholders who must be consulted before the decision is made I
Informed: Person who must be informed on process output/decision made
Tender Committee Members Include;
Purchasing
Internal Stakeholder
Controlling or 3rd Party (The 3rd party can be formed by Legal & Internal Audit when necessary)

5. Call for Tender Process Overview
Stakeholder
Initiate and Confirm Request to Purchasing
Purchasing
Request for Proposal/Quotation (5-15 working days)
Summarize Evaluation (7 working days)
Award (1 working day)
13-23 working days
Notes:
Additional lead time need to be considered if there is no appropriate vendor in L’Oreal China vendor pool.
For production item need mock-up or site visit evaluation need additional working days. 5

6. 1. Setup Tender Committee 2. Kick-off Tender Meeting
Call for Tender Process
1. Setup Tender Committee
2. Kick-off Tender Meeting
3.Sourcing & RFI
6. Complete & Submit RFI
Supplier
3. Kick-off Tender ②
8. Determine Short List per RFI Criteria
Tender Committee
2.Setup Tender Committee & Sponsor
4. Explore Suppliers for Tender
5.Send RFI for Tender ③
7. Analyze RFI
Buyer A
1. Request for Tender ①
Purchasing Manager
2 Working Days
5 Working Days
10-45 Working Days
“Request for Tender” accords to purchasing annual tender plan and sourcing strategy, align with internal customer.
Kick-off meeting shall include project brief, agree on project objective, retro plan and key milestones.
Buyer sends official tender invitation letter in written to all the candidates via , and send RFI to supplier to complete. Invitation letter includes general message of project brief, but not necessary for specific figures.

7. Call for Tender Process
4. Credit Check
5. Mock-up
6. RFx
12. Do Mock-up
16. Complete & Submit RFx
Supplier
13. Blind Test Mock-up via “Blind Test Evaluation Form” ①
14.Select Mock-up Qualified Supplier
17. Evaluate RFx ①
Tender Committee
Yes
10. Send Project Specification
15. Send RFx
Buyer
11. Do Mock-up? A No B
Step 7: Launch RFI process to pre-select supplier and then do supplier evaluation. Increasing tender workload and reducing tender cost.
9. Perform Credit Check
Transverse buyer
20 Working Days
Working Days
5-15 Working Days
Blind test evaluation and RFx evaluation must be performed by all stakeholder,

8. Call for Tender Process
7. Site Visit
8. Summarize Evaluation
9. Awards
Supplier
19. Visit Supplier & Evaluate via Site Visit Evaluation Form ①
20. Do Tender Summary per RFx Evaluation or Site Visit Evaluation ②
24. Make Tender Conclusion
Tender Committee B
27. Tender Summary and Archiving
21.Archive RFx and Site Visit Evaluation Summary
22. Conduct Negotiations ③
23. Finalize Evaluation of RFx
25. Announce Tender Result ④
26.Send Award & Non-award Letter
Buyer
Yes
18.Site Visit? No
10 Working Days
7 Working Days
1 Working Day
Buyer organizes site visit with tender committee, and evaluate supplier per “Site visit evaluation form” with tender committee together.
Tender summary’s contents refer to appendix 3 “Project Summary Archive Documents”.
Buyer conducts negotiation for saving, purchasing condition with selected suppliers.
Buyer inform internal customer tender result.
Buyer archives tender summary to refer appendix 3 “Project Summary Archive Documents”.

9. Bidding process

10. Propose Pitch & Develop Mock-up
Bidding Role & Responsibility
Initiate
Request
Sourcing New Supplier
Propose Pitch & Develop Mock-up
Supplier
Selection
Awards
Internal Stakeholder
Purchasing A R C A C I C A R R A R A R A
Accountable: Decision maker who has the final say. R
Responsible: The process owner who is Responsible to delivery C
Consulted: Other stakeholders who must be consulted before the decision is made I
Informed: Person who must be informed on process output/decision made

11. Bidding Process Overview
Stakeholder
Initiate and Confirm Request to Purchasing
Purchasing
Request for Proposal/Quotation (5-15 working days)
Summarize Evaluation (7 working days)
Award (1 working day)
13-23 working days
Notes:
Additional lead time need to be considered if there is no appropriate vendor in L’Oreal China vendor pool.
For production item need mock-up or site visit evaluation need additional working days. 11

12. 1. Initiate and Evaluate Request
Bidding Process
1. Initiate and Evaluate Request
2. Sourcing New Supplier
1. Submit Sourcing Request via Business Requirement Brief Form ① ②
4. Justification Process via Justification Form for Vendor Creation
5.Vendor Registration
Internal Stakeholder
Yes
Buyer
2. Evaluate Request
3. Non- Centralized?
6. Enough Existing Supplier?
8. Bidder list per Vendor Recommendation Criteria ③ ④ ⑤ No
Yes A
7. Sourcing New Supplier No
Step1: Create a standard form to support requestor initiate "vendor recruitment" needs. it enhances the communication efficiency between purchasing department and requestor.
Step4: After define a clear supplier selecting criteria, buyer is fully authorized to choose supplier from existing vendor pool. It improves their decision-making efficiency.
Step 7: Create non-centralized vendor recruitment process
Purchasing Manager
9. Approve Bidder List if
Spend > 50K RMB
5 Working Days
10-40 Working Days
Vendor recruitment also can be initiated by purchasing department when the sourcing strategy in placed.
In “Business Requirement Brief Form”, budget manger must be copied if annual spending is more than 500K RMB.
Refers to Appendix 1 “Vendor Recommendation Criteria”
Bidder list analysis has to be included in project summary
Requestor recommended supplier will be considered as one of the candidates.

13. Bidding Process 3. RFI 4. Credit Check Purchasing Manager Supplier
11.Approval by Purchasing Manager
Supplier
14. Complete & Submit RFI
12.Vendor Registration
15. Analyze RFI
Buyer
Yes
10. One-time? ①
13. Request for Information via RFI Form
16. Archive RFI
17. Shortlist per RFI Criteria ② A B No
Step 12: Create onetime vendor recruitment process to support service for trial business.
Transverse Buyer
18. Perform Credit Check if Annual spending >RMB 1 M
5 Working Days
20 Working Days
One-time supplier is applied for service trial, and subjected to purchasing manager approval. A quarterly review will be applied.
Buyer must set RFI criteria weight according to project background before RFI. RFI criteria refer to appendix 2 “Appendix 2: Must Requirement”

14. Process 5. Mock-up 6. RFx 7. Site Visit Supplier Internal Stakeholder
Tender
Bidding
Order Management
Justification
Contracting
Supplier Management
5. Mock-up
6. RFx
7. Site Visit
Supplier
20. Make Mock-up
24. Complete & Submit RFx
Internal Stakeholder
27. Visit Supplier & Evaluate via Site Visit Evaluation Form
21. Blind Test Mock-up via “Blind Test Evaluation Form”
22.Select Mock-up Qualified Supplier
25. Evaluate RFx ②
28. Summarize Evaluation per RFx Evaluation
Yes
19. Do Mock-up? B
Step 23 and 26: RFX evaluation must be performed with stakeholder.
Buyer
23. Send RFx
Yes No
26.Site Visit? C No
10-20 Working Days
5-15 Working Days
10 Working Days
All evaluations (Blind Test Evaluation, Proposal Evaluation, Site Visit Evaluation) are cooperate jobs done by all stakeholders.

15. Bidding Process 8. Summarize Evaluation 9. Awards Internal Stakeholder
35. Order Management
Internal Stakeholder
34. Project Summary and Archiving ①
29.
Conduct Negotiation
30. Finalize Evaluation of RFx
31. Announce Winner to Internal Stakeholder
32.Send Award & Non-award Letter
Buyer C
Accounting
33. Vendor Registration ②
7 Working Days
1 Working Day
Project documents for archiving refer to appendix 3 “Project Summary Archive Documents”
1 day lead time for “Welcome to Board” excludes time spent for “Vendor Registration” that needs 5 working days

16. Exception management

17. Exception Management
We understand there are exceptional cases in daily operation. In order to support business and ensure process efficiency, purchasing developed Justification Process to Manage exception for scenarios;
No Bidding for Spending >= RMB 200K or
Minimum Quotation from Bidding <3 or
New Vendor Creation for;
Non-centralize supplier (not covered by purchasing)
Supplier imposed by regional or global decision
Supplier provide Celebrity or Sponsor Service
Monopolized Supplier
Public Organization
Customer as vendor
Non-centralize supplier
(not covered by purchasing)
Personal Rental
Children tuition fee
Move & Settle Allowance
Insurance
Utilities

18. Appendix 1: Vendor Recommendation Criteria
When purchasing recommend existing supplier to end user, buyer has to consider
the criteria and make bidder list.
Criteria
Penetration Rate ≤30%
Available Capacity
Bad Performance Records
Supplier Service Scope

19. Appendix 2: MUST Requirement
The sourcing new supplier, below criteria is must requirements be considered.
Criteria
Descriptions
Credit Rating
Financial Risk: Lower than average
Penetration Rate
≤ 30%
Shareholders Structure
No Ethics Issue

20. Project Summary Archive Documents
Appendix 3: Project Summary Archive Documents
Project summary should includes documents below;
Project Summary Archive Documents
Business Requirement Brief to Supplier
Proposal / Quotation
RFx Evaluation Summary
Award / Non-award Letter
Justification Form (if applicable)