Inappropriate or insufficient advertising
Risks
- Potential bidders are not identified
- A complaint is received, under the PCR 2015 procurement legislation, about the lack of, or the selected method of, advertising
Solutions
- Develop an advertising strategy that aims to create sufficient interest in the requirement
- Advertise all requirements over a stated value on the institution’s own web site e.g. operate a ‘Living PIN’
- Advertise all requirements valued above the appropriate PCR 2015 thresholds in the Find a Tender Service and Contracts Finder
Buyer selects bidders to submit bids for requirement
Risks
- Implication the selected bidders are considered capable of meeting the requirement i.e. already meet any selection criteria
- Other bidders are available but are not afforded the opportunity to compete for the business
Solutions
- Only select bidders when seeking quotations or tenders for lower value requirements without a call for competition
- The use of a ‘Living PIN’ would enable potential suppliers to see current bid opportunities and ask to be included in the competition
Too many bidders
Risks
- The work involved in evaluating the submissions outweighs the value of the requirement
- The bidders start to loose interest in competing for work as there is little chance of winning any business
Solutions
- Use the restricted rather than open procedures for PCR 2015 tenders, only issuing invitations to tender to firms meeting the published selection criteria
- For repetitive requirements where there is a large supplier base, consider setting up a Framework Agreement with at least 3 contractors or use framework agreements available to you from purchasing consortia such as Crescent Purchasing Consortium.
- For repetitive requirements where there is a small supplier base, and you have access to a fully electronic tendering process, consider setting up a Dynamic Purchasing System
Too few bidders
Risks
- There is insufficient competition
- It may not be easy to determine if the bids received represent value for money
Solutions
- Complete market research to determine the size of the current supplier base
- If there are other suppliers available, try to find out why they are not submitting quotations and take action, for example; Didn’t know of the requirement – look at your advertising practices. The specification is too restrictive? – redraft specification and, if necessary, re-run the competition. The institution is considered too difficult to deal with – seek to attract more suppliers using a ‘Dealing with this Institution Guide’ and running seminars aimed at attracting more suppliers. Could there be collusion or a cartel in operation? – this should be referred your Head of Procurement.
Long term relationships with some suppliers
Risks
- Relationship may become ‘too cosy’
- ‘Friendly/helpful’ sales representatives have input into drafting specifications and create a bias towards their products
- May be difficult to demonstrate that the on-going arrangements represent value for money
Solutions
- While partnership relationships are encouraged these should be market tested by tendering the requirement on a regular basis (at least every 4 years)
- While technical discussions are permitted, care must be taken to ensure that no single supplier’s products are favoured in the final specification
Continued use of the same suppliers
Risks
- The value of repeat orders for similar products over time may exceed the published EU thresholds
- The relationship becomes ‘too cosy’
Solutions
- While partnership relationships are encouraged these should be market tested by tendering the requirement on a regular basis (at least every 4 years)