The Procurement Process

4 Procurement Strategy

Procurement Principals
0 Procurement Principals 1 Project start-up 2 Risk Allocation Model 3 Business Case 4 Procurement Strategy 5 Market Assessment 6 Market Creation 7 Produce Requirement 8 Supplier Selection 9 Proposal Evaluation 10 Contract Preparation 11 Bid Evaluation 12 Award 13 Project Closure 14 Implementation / Transition 15 Contract Management
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You are on step 5 of 14 steps.

Click for slide: Take account of previous procurements Click for slide: Encourage small and medium sized enterprises Click for slide: Specify requirements Click for slide: Determine the procurement option Click for slide: Options for construction projects Click for slide: Options for IT projects Click for slide: Determine the procurement route Click for slide: Plan the procurement Click for slide: Produce the procurement strategy Click for slide: Develop a contract strategy Click for slide: Determine pricing mechanism Click for slide: Develop the evaluation strategy Click for slide: Prepare an OJEU Notice Click for slide: Update the business case and Decision Point
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What you need to do

For property and construction projects, there must be a full evaluation of integrated procurement strategies. Construction projects should be procured using one of the following three routes.

  • PPP/PFI (Public Private Partnerships/Private Finance Initiative). A supplier is contracted not only to construct a facility such as a road or prison, but also to deliver the services that the facility is intended to provide. Risks associated with providing the service are allocated to those best able to manage them. The outputs that the service is intended to deliver must be clearly defined.
  • Design and Build. A single supplier is responsible for both the design and construction of the facility. Clients have to specify the type of building they require in terms of the outputs and services it is intended to deliver and the contractor proposes the best design to meet this.
  • Prime Contracting. The Prime Contractor will be expected to have a well-established relationship with a supply chain of reliable suppliers of quality products. As well as integrating that supply chain into the design process with contributions from key suppliers, the Prime Contractor co-ordinates and project manages throughout the design and construction period to provide a facility which is fit for the specified purpose, and meets its predicted through-life costs.

Points to consider

Traditional, non-integrated strategies should only be used where it can clearly be shown that they offer the best value for money.

For more information to support construction projects see the Achieving Excellence Guides and the new engineering contract NEC-3.