Whenever the public sector has a need for goods, works, or services (which are over a certain contract value), they are required to publicly advertise this need, and encourage businesses to compete for the work.
This process is referred to as publishing an ‘Invitation to Tender’ or ‘ITT’, and the associated documents have become more commonly known as tenders.
Why are public tenders needed?
As the public sector relies on public funding to make decisions, all procurement must be made respectfully, encourage free and open competition, achieve best value for money and ultimately benefit the public.
These requirements prevent unethical procurement practices, while also allowing businesses, regardless of size, to enter the market. For more information about this, please read our article ‘6 reasons to do business with the Public Sector?’
What types of tender are there?
Low and High Value Tenders
The value of a tender determines the rules in place for how the notice must be advertised.
High-Value Tenders, also known as Above Threshold Tenders, are those which have a value above the EU public procurement threshold, and must be advertised in the OJEU to encourage competition from other EU countries. From 1 January 2021, the rule will be changing and these notices will instead be posted to the new government portal ‘Find a Tender’. More information is still to be announced, but you can find out more in our article Brexit and Public Procurement.
Low-Value Tenders, also known as Below Threshold Tenders, have a value which is below the EU threshold and are advertised within the UK. These contracts are much smaller than High-value tenders, making them a great starting point for businesses entering the market for the first time. The procedures for low-value notices are simpler, and bidding for these provides suppliers with valuable experience to help them go after high-value tenders in the future. For more information, read our article ‘Why we love low-value tenders’.
For details on the current public procurement thresholds, please see ‘New Public Procurement thresholds 2020/2021’.
Public Procurement Procedures
Open procedure
Is the standard procedure and for public procurement within the UK. This type of procedure allows any business to respond to a tender, access associated documents and bid for the tender.
Restricted Procedure
Is a two-stage procedure which involves creating a shortlist of the most suitable suppliers, by having them first complete a selection questionnaire. Those shortlisted will receive an invitation to tender, and are allowed to bid for the contract. This type of procedure is generally used if a high volume of bidders is expected.
Competitive Dialogue Procedure
Is a multi-stage procedure which allows discussion with suppliers before issuing an invitation to tender. It is used where procurement needs are complex, and as with Restricted Procedures, bidders will first be shortlisted. After the selection stage, the requirements and solutions will be discussed with shortlisted suppliers. From these discussions, the requirements will be finalised and an invitation to tender will be issued.
Competitive procedure with negotiation
Is a multi-stage procedure which allows negotiation with suppliers after they have submitted their bids. This procedure includes a selection stage questionnaire, and the final negotiation stage is optional – as along as this has been stated within the tender. Much like the Competitive Dialogue Procedure, it is used where procurement needs are complex.
Innovation partnership
Is a unique procedure which is used when no goods, services or works exist to meet the procurement need. Selection stage questionnaires are used to identify the most suitable suppliers before invitations to tender are issued. The products produced as a result of this partnership may be purchased by the public body, but only if they meet the minimum requirements identified within the tender.
Framework Agreement
Is an umbrella agreement that sets out the terms – particularly relating to price, quality and quantity – under which individual contracts (call-offs) can be awarded at any point during the lifespan of the framework. Frameworks are typically used when the buyer has identified a need for specific products or services but is unsure of the scope or time-frame. The agreements created give buyers access to a range of qualified suppliers, allowing them to avoid the need to continuously re-tender. Being an a framework does not guarantee work, as there may be multiple suppliers offering the same goods, works or services – in such instances, mini competitions or best value will determine who wins the work. Full details of these agreements can be found in ‘Framework Agreements: What you need to know’.
Dynamic Purchasing Systems (DPS)
Is similar to a framework, however new suppliers can join at any time, and is used for goods, works and services commonly available on the market. A DPS must be set-up using the restricted procedure, and the process is required to be entirely electronic. Unlike a framework, there is no limit on the number of suppliers that may join a DPS, and any supplier may join during the tender’s lifespan. DPS are used to streamline procurement for both buyers and suppliers, as suppliers only need to demonstrate suitability once, and buyers can award contracts quicker than other methods allow.
How do I find public tenders?
There are thousands of portals through which public bodies can publish their notices, and it would take a significant amount of time and effort to try and locate every opportunity relevant to your business.
Thankfully, Tenders Direct eliminates your need to search for tenders by collating every UK and ROI notice in one place, and alerting you to the tenders you want to bid for. Our unique service ensures we are aware of every tender published, and allows us to guarantee that with Tenders Direct – you will never miss a public sector notice.
Request a demo today and discover all the opportunities you could be bidding for.
