If you’ve spent any time looking for tenders, you’re likely to have come across the terms Framework and Dynamic Purchasing System (DPS) and if you’re really lucky Pseudo Dynamic Purchasing System!
So what exactly are they and why should you be bidding for them?
A Framework agreement or Framework contract is a slightly different arrangement to that of a standard contract award. Instead of being a direct contract between the buyer and supplier, the buyer selects a number of suppliers to be appointed places on a Framework, resulting in a group of ‘pre-approved’ suppliers that the buyer can choose from, each time they need a specified product or service to be delivered. This is typically termed ‘Framework call-off.’ A Framework may be set up to supply goods or services to a group of buyers (e.g. a regional group of local councils) to generate a volume buying efficiency or just one buyer. The number of suppliers appointed to a framework can differ, sometimes it can be any number, rather than a pre-determined maximum; the tender notice will usually specify how many. Similarly, a Framework may also be set up to appoint only one supplier. A Framework agreement has a defined start and end date, just as with a direct contract award.
Dynamic Purchasing System (DPS)
A DPS is a specific type of Framework that remains open (hence the name dynamic) for bidders to apply to join throughout the length of the agreement. The application and selection process may sometimes operate in rounds, e.g. every year, or applications may be accepted at any time. If you are unsuccessful with your first application, you are likely to be able to try again after a length of time has elapsed.
How is work assigned (called-off) from the Framework/DPS?
There are two main ways that work is assigned from a Framework or DPS – via a direct award or a process known as a mini call-off competition. A specific tender notification will be sent out to Framework suppliers only (rather than all suppliers as per OJEU) and the tender documentation will include further details of specific call-off arrangements.
With a direct award, the buyer simply chooses a supplier from the Framework/DPS, provides them with the details of the piece of work, and, assuming the supplier can deliver, the work is assigned. The selection process used by the buyer for a direct award can vary, such as:
- Round robin – e.g. on a framework with 3 suppliers, the first piece of work goes to supplier 1, the second piece of work goes to supplier 2, the third piece of work goes to supplier 3 etc.
- Catalogue price – the supplier who submitted the bid with the lowest price for that specific product or service will be awarded the work.
- Time – The fastest supplier to respond with a commitment to providing the service will be awarded the contract e.g. provision of a social care shift or care home bed.This is usually against pre-determined or specified fixed fees.
With any method, should a supplier not be able to deliver, the buyer will select another supplier, but should that happen too many times, the likelihood is the supplier will be removed from the Framework.
Mini call-off competition
Alternatively, the buying organisation(s) may decide to run a further mini call-off competition between the suppliers on the Framework/DPS. This is basically the same process as tendering for a direct contract, but with competition limited to only those suppliers on the Framework/DPS. You will need to answer further, and potentially much more complex quality questions and submit pricing. The buyer will specify the criteria they are using to assess the bids, just as for a direct tender award.
What are the advantages of being appointed to a Framework/DPS?
Critically, although frameworks or DPSs do not guarantee you any level of work (even as the only appointed supplier!), they can be a very important mechanism for growing your business. They are often an easier route to supplying at least some quantity of products/services and marginally less competitive, as they typically involve selection of more than one supplier. By becoming ‘framework approved’ you also have the added credentials with which to market your business to other buyers.
- If you’re new to tendering, getting appointed to a Framework/DPS can sometimes be easier than winning a direct contract. You don’t need to beat all the competition to be appointed to a Framework, just some of the competition. Some of the bigger companies may not be interested in Frameworks if the value is shared and can often miss or disregard these in tracking tender opportunities.
- Some Frameworks have fewer quality questions to answer (some may even have none), however you will still need to make sure your business is tender ready LINKin order to pass the Selection Questions.
- Once you’re on the Framework, you will start getting public sector experience (assuming you are awarded work). This will stand you in good stead for the next time you put in a bid for a direct contract as you can build up your references and case studies in the public sector.
- If multiple buyers are using the framework, there could be a large amount of business available as you will be eligible to provide services to all of them. You also have the opportunity to approach other buyers to suggest that they use the framework you are on to procure services they need.
- Mini call-off competitions provide valuable tendering experience. You will receive feedback on your bid and can use that to help craft a better response next time round.You can potentially find out who the other suppliers are on your framework and use feedback as a benchmarking exercise against your closest competitors.