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 9 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

This document sets out the strategy to be followed for the procurement, with appropriate justification. It should cover:

  • key objectives of the procurement for the project;
  • chosen procurement option;
  • chosen procurement route (Open, Negotiated, Restricted, Negotiated Dialogue)
  • key milestones (check that enough time will be allowed for negotiations, if relevant.)
  • key documents e.g. requirements specification.

Points to consider

Key factors influencing the procurement strategy relate to the degree of complexity, innovation and uncertainty about the requirement, together with the time needed to achieve a successful outcome. The procurement strategy should facilitate a collaborative approach and open communication between potential suppliers and client, subject to the procurement route chosen (i.e. the Restricted route limits the extent of dialogue with suppliers).

Teamworking is especially important for construction projects.
If the requirement is very complex consider breaking it into several smaller and/or phased procurements, but be aware of the potential to be in breach of EC aggregation rule (see Introduction to the EC procurement rules).

Factors influencing risk include:

  • the complexity of the project
  • the scale of the project
  • the length and rigidity of the timescales for implementation
  • the priorities of the business benefits to be achieved
  • the possibilities of change in the customer organisation's operations
  • availability of project management and technical expertise
  • the ability of the market to respond
  • the levels of innovation required.

For major services where there is an IT component, it is government policy that departments should adopt a modular or incremental approach to the project unless there are very strong reasons why they should not do so. See also the Risk Allocation model.