When and how to run a further competition for your goods and services: Procurement Essentials

30 May 2022 03:23 PM

Procurement Essentials is a series of articles to help you overcome common hurdles, understand key concepts, and make your life as a buyer of everyday goods and services easier

Running a further competition ensures you get the best solution and competitive pricing for what you need. 

As discussed in a previous article in this series, frameworks help public and third sector buyers to procure goods and services from a list of pre-approved suppliers, with agreed terms and conditions and legal protections. 

Once you’ve decided that using a framework is the best way for your organisation to buy goods or services, you may then be able to ask all the suppliers listed on it to bid. This process is called a further or mini-competition and can be run under most frameworks. Please check the customer guidance for each framework.

Why run a further competition?

Frameworks provide specific goods or services but individual customer needs may vary, which makes it difficult for suppliers to provide a ‘one size fits all’ approach to pricing and requirements. 

Further competitions enable you to outline your own specific requirements and identify the best solution for your organisation. Suppliers can then consider your requirements and produce a tender that outlines how exactly they can meet your needs. 

When should you run a further competition?

Further competitions work best for more complex goods and services; for example, installing fire protection sprinklers and alarms within a school or a refurbishment or construction project. 

They don’t work for low-value, ad-hoc purchases, where the time and cost of running a further competition is disproportionate to the goods and services supplied; for example, a school or college purchasing one off tail spend items such as a box of calculators or sports equipment. They are also not ideal when you have urgent requirements, because of the extra time it can take to complete the process.

In some instances, you can choose to place a direct award without further competition. This is only possible where it is stated as an allowed option in the guidance notes for the framework agreement.

For some agreements, such as a Dynamic Purchasing System, there is no direct award option and you can only award a contract following a further competition.

How to get it right

Running a further competition can be daunting if you’ve never done it before and it’s not part of your normal day to day job. 

Here are our top tips on how to make the process easier:

Stage 1: define your requirements and invitation to tender

The first step in the process is to do your research and determine exactly what you want to achieve from the contract. This is your opportunity to refine the framework to detail your specific requirements for your contract. For example, how long do you want the contract with the supplier to last? Is it a one-off purchase or a long-term arrangement? 

Your specification shouldn’t significantly change what suppliers originally signed up to deliver when bidding for the framework agreement, but it will provide the detail of what you need, when, and how.

You’ll also need to prepare an Invitation to Tender (ITT) along with a draft contract and specification (which may be provided in template format as part of a framework agreement’s schedules). An ITT is a formal procurement document that is issued by the buyer, inviting suppliers to bid for the contract of works. Your ITT should include:

  • a covering letter
  • a timetable
  • how to ask questions
  • how to submit a bid
  • your specification 
  • your award criteria
  • specific levels of service you want
  • your terms of appointment

TIP: make sure you allow sufficient time for suppliers to respond to your further competition. This way you’ll get more (and better quality) responses. Three weeks is generally considered to be the minimum timescale required for a supplier to respond to an ITT. 

Stage 2: invite suppliers on the specified agreement and lot by issuing the ITT, requirements document and draft contract

At this stage, and sticking with the example of a school construction project, it might be beneficial to allow the potential supplier to carry out a site visit so that they can assess the work that needs to be done. 

TIP: if you want to find out how many suppliers are interested in bidding then you can send an expression of interest (EOI) to them all. After doing this, you only need to send your ITT to suppliers who responded. Check the framework rules first – not all of them allow this.

Stage 3: evaluate suppliers’ responses

When the deadline for submissions has passed, you can begin to evaluate the supplier responses. Your chosen supplier should be the ‘most economically advantageous’ – the one that best combines price and quality (and, for some agreements, social value). 

Make sure you don’t deviate from the award criteria that you previously set in your ITT (and that set out for competitions in the framework agreement) in order to be fair and transparent and avoid any challenges.

TIP: make sure your evaluators are clear on the bid evaluation process from the start and what your requirement is. 

Stage 4: award a contract to the successful supplier and notify unsuccessful suppliers

You should now be able to identify a winner from the scores you’ve given at the evaluation stage. At this point it’s time to notify all the suppliers of the result. 

The most appropriate way to do this is by letter. Some CCS frameworks have example letters that you can use. 

TIP: the award letters and letters to unsuccessful bidders should all be dispatched at the same time.

Stage 5: 10 day standstill period 

The standstill period is at least 10 calendar days, during which time the contract award process is suspended. This gives unsuccessful bidders an opportunity to consider feedback, request further information or call for a review of the decision. 

Once the standstill period has passed you can begin your contract with the winning supplier.

Speak to your commercial team / legal advisors to decide if this is appropriate for your procurement or not.

TIP: during the standstill period, a single point of contact is critical. Other members of your evaluation team should not engage in direct communication with any bidder. 

Find out more

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