Nicola Maliphant, Value Wales

Joint Bidding for Public Contracts

Public Procurement in Wales

• Annual procurement expenditure over £5.4bn

• Over 90% of Welsh suppliers are SMEs• “Opening Doors Charter”- 2006

Widening access to procurement

Research in 2009 showed that the biggest “Barriers to Procurement Opportunities” for small and third sector organisations are:

– Access to advertised opportunities– Difficulty getting through the “pre-qualification” stage– Contracts being too large to bid for

Government policy and reports

• Procurement Policy Statement – next slides..

• Micro-business report – Jan 2012 – “Encourage micro-business to consider

consortia approaches to public sector procurement.”

Wales Procurement Policy Statement – Principle 5

• Open, accessible competition – public bodies should adopt risk based, proportionate approaches to procurement to ensure that contract opportunities are open to all and smaller, local suppliers are not precluded from winning contracts individually, as consortia, or through roles within the supply chain.

Joint Bidding• Consortium bidding seen as a solution to “large

contracts vs small suppliers” problem• Difficult to make it work, on both:

– buy side - processes geared to working with one company

– buy side - consortia delivery seen as high risk– sell side - timescales often challenging– sell side - developing trust and managing risk

• Few examples of success

Joint bidding 2

• Welsh Government, Wales Council for Voluntary Action and Wales Cooperative Centre funded guide to joint bidding

• ServQ awarded (advertised) contract to research and develop the guide

• One guide for both the buy and sell sides• 18 short pdf chapters, with practical tools, forms, case

studies etc.• Available on-line

Questions for buyers• Look at organisational processes etc. Do they

make joint bids hard? • Can I make future opportunities visible earlier?• Analyse the requirement – does it lend itself to

joint bids? If so, say so.• Do I understand the market?• Are timescales realistic?• Think through how I’d assess a joint bid fairly

against a single bid – are the questions worded correctly and how will they be scored fairly?

• How do I manage risk?

Messages for supply side• Pre-forming a consortium – what are my

organisation’s goals, strengths weaknesses and hence opportunities to collaborate?

• What sort of consortium should we set up?• Could I fall foul of competition law?• Should we bid for THIS opportunity?• How do we develop a collaboration agreement?• How do we manage risk?• How do we develop a joint estimate and pricing?

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For buyers - more detail

• Ch 2 - Policy (buy-side): • assessing organisational policies to check openness to

consortium bidding

• Ch 3 - Preparation (buy-side):• assessment model, detail on setting selection criteria,

including financial assessment

• Ch 4 - Advertising (buy-side)• early advertising and PINs

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More detail (cont.)• Ch 6 - Structures (both sides)

• types of consortium, competition law

• Ch 7 - Market (both sides)• understanding the market

• Ch 8 - Registration (both sides)• using e-tendering and advertising systems

• Ch 11 - Governance (both sides)• structures needed on supply-side, agreements etc

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• Chapter 12 - risk (both sides)• integrating risk management and planning

• Chapter 16 - tender analysis (buy side)• additional factors for consortia, managing risk

• Chapter 17 - presentation (both sides)• interviews and clarifications

• Also Glossary, Case Studies and Further Reading

• Guide cross-referenced with ISO11000

More detail (cont.)

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Demonstration Projects (1)

• Minister announced pilots Nov 2013• Approx 14 in 6 organisations, since Nov 2013,

worth £750m.• Range of markets/sizes/organisations• Project underway and successes - Families First

programme in Carmarthenshire, WHQS Minor works framework Caerphilly

• FMB has support for construction project and CFW/CITB

Conclusion

• Consortium bidding seen as a solution to the big contracts/small suppliers problem

• Difficult to make it happen for practical and “cultural” reasons on both sides

• New guide sets out the risks and processes for managing them

• The proof of the pudding…demonstration project lesson learnt will be incorporated into the Guide-practical and useful.