“How to Win Contracts”26th January 2012

Graham Frankland Assistant Director (Resources)

Council’s overall aimsJobs & the Economy (‘Hartlepool’s Ambition, 2008 –

2020’)

‘Develop a more enterprising, vigorous and diverse local economy that will attract new investment, enable local enterprises and entrepreneurs to be globally competitive and create more employment opportunities for local people’

“Buy Local” CampaignEncourage all businesses including the Public Sector to use Hartlepool Suppliers.

Teesside £16,045,906.73 24.69%

Hartlepool £12,032,447.02 18.51%

South East Midlands & East Anglia £7,708,674.93 11.86%

London & South East England £4,694,070.04 7.22%

Yorkshire £4,440,285.28 6.83%

Newcastle £4,064,025.44 6.25%

Darlington £3,194,079.38 4.91%

Mid Wales & West Midlands £2,407,690.93 3.70%

North West England and Scotland £2,023,086.50 3.11%

Greater Manchester and North Staffs £1,850,926.99 2.85%

South West England £1,736,200.20 2.67%

East & North Midlands £1,419,500.64 2.18%

South Wales & West England £992,651.29 1.53%

North Wales and Merseyside £841,359.05 1.29%

Durham £682,508.70 1.05%

Sunderland £669,785.26 1.03%

Tees Valley 49%

How much do we spend and who with?

The Procurement “Dilemma”• The Government’s and Council’s Financial

Position• Identified Savings from procurement• National, Regional and Sub-Regional Contracts

BUT….. What about the local economy?

• How do we get the best of both worlds?

• NOTE… Reducing Budgets, Capital Programmes and Grants.

“Best Value”• Not just price• Quality of provision• Responsiveness• Social, economic and environmental benefits• Innovation

So it’s about… Maximising additional benefits

• Responding to needs and reduce barriers to competition

• BUT.. There are rules

The Rules of Engagement

• EU Directives• Public Contract Regulations 2006

• >£174k supplies and services; >£4.3m Works

• Contract Notice published in OJEU

• Variety of procedures – Restricted most used

• Statutory timescales

• Prequalification – based on company capability

• Tender evaluation – open and fair

• Hartlepool’s Contract Procedure Rules• Quotations

• Tenders

• Thresholds

• Local Suppliers

Contract Procedure Rules

• Part of the Council’s Constitution

• Aims:– Reduce risk to Council– Ensure Value For Money– Open and fair

• Sets competition requirements

Procurement Choices• In-house Teams (sub-contract opportunities)• Existing HBC Contracts• Tees Valley Collaborative Contracts• North East Procurement Organisation (NEPO)• Office of Government Commerce (OGC) Frameworks

(Now GPS – Government Procurement Service)• Other National Frameworks• Civil Sector (including voluntary and community/

social enterprises)• Local Suppliers

• Tenders and Frameworks

How are we organised?

• Corporate Procurement Team – Central team looking at corporate contracts, tendering processes and guidance

• 3 Departments – Regeneration & Neighbourhoods, Child and Adult Services & Chief Executive’s Department

• All tenders (Goods/Services over £60k and Works over £100k) carried out by Corporate Procurement but with a lead from the department responsible for the service.

• Council piloting e-quotation system with a view to corporate roll-out.

• Executive Councillors – Portfolio Holders/Cabinet make the decisions

How we support small businesses

Changes for the Better

– Tender thresholds

• Thresholds raised so that more contracts can be awarded through the less onerous ‘Quick Quotes’ route rather than a more complicated tender process

• £25k to £60k (goods and services), £100k for works.

– Advertising requirements

• Advertising requirements have been changed to enable Council buyer’s to focus advertising in the Hartlepool area, where appropriate rather than just placing adverts in national journals

– 2 Local Suppliers to bid

• The Council’s contract procedure rules require that, where available, a minimum of two local suppliers are to be invited to bid

– Quotation gathering process mandated

• The Council is moving towards mandatory use of the ‘Quick Quotes’ system for all requirements greater than £2,000 (unless the required goods/services are already covered by a pre-existing framework agreement or delivered through in-house services).

• Provides consistency and fairness

Contract Procedure Rules - Tender or Quotation?

173, 934

4,348,350

E-quotation process (Individual Procurers)

E-tender process (Corporate Procurement Team)

Informal Process

Must be recorded Must be recorded

2 local 2 local

Frequently asked questions

• Where can I find opportunities?• How do I get on the approved list?• Who buys my products/services?• How can I win more business?

Finding opportunities

• Quotations (£2000 to £60,000/£100,000)

– Issued using the Council’s ‘Quick Quotes’ system– Register on the NEPO portal to be eligible to receive invitations to quote

• Non-EU Tenders– Advertised on the Council’s webpages– Issued using the Council’s E-procurement system (linked to the ‘Quick Quotes’

system)– Register on the NEPO portal to be eligible to receive invitations to quote/tender

Quotation opportunity

E-procurement• E-tenders

– All handled by the Corporate Procurement Team

– Using the NEPO Portal– Or other Portal e.g. OGC

• E-quotations – ‘Quick quotes’– Handled by Council Departments– Using the NEPO Portal (Pilot underway)

Finding opportunities – Council Webpages

NEPO Registration

• www.qtegov.com/• Suppliers can register FREE at the above web

address and have access to business opportunities not only in the Hartlepool area but across the whole North East.

• ALL 12 Local Authorities in the region are using the NEPO system to varying degrees.

Where else are opportunities advertised?

173, 934

4,348,350

Buying ‘Local’

• ‘SME friendly lots’– Where it supports the achievement of value for money, the Council will refrain

from unnecessarily aggregating its requirements, thereby making contract values lower and opportunities more accessible to smaller businesses

• Advice on winning Council business– Council Procurement staff deliver advisory sessions to local groups, e.g. FSB,

HVDA, providing background and advice to assist local businesses and voluntary organisations in winning Council business

• Training and Access to Employment– Economic Development provide tailored services to assist

What do we look for from Suppliers?

• Rarely select on price alone• Usually a mix of price and quality• Quality measured by specific questions

in tender invitation and references• Whole life cost• Looking for efficiencies

- New ways of doing things- Efficiency sharing- Process improvements

• “Best Value”

What You Should Do?

• Get e-enabled• Check the websites• Register on NEPO Portal• Make the enquiries• Get the advice• Attend Meet the Buyer Events and Supplier

Days

Get Your Information Together

– Accounts– Health and Safety– Experience and References

How to Tender

• Read Documents carefully• Answer the questions – provide the evidence• Ask for guidance• Look to “add value” in your submission• What are your “local” selling points• Get feedback

“Social Clauses”

• Allow suppliers to provide “added value”

e.g. Training, local employment, apprentices, address long term unemployment, other community benefits

• What are the local benefits you can bring?

• TELL US

What About the “BIG Contracts”?

• Make contact with the “Big Boys”• Dyke House School (BSF) – Balfour Beatty• Local Supply Chain Requirements• Supplier Event at Historic Quay• At peak of contract:-

- 67% of subcontractors were within 25 mile radius of Hartlepool

- 20% of the workforce live in Hartlepool- Around £2m on the Contract (with a total value of £12 million) has been spent on Hartlepool suppliers)

Framework Agreements

• Call-off contract• Single supplier or multi-supplier• Becoming popular – Councils encouraged to

collaborate and do more with less

• Attractive because:– Removes or reduces need to tender– Requires less effort– May deliver better prices through aggregation

Framework Agreements

If cannot bid, SME’s may consider:• Bidding for one lot• Joint bid with another supplier

• Working as a subcontractor – Councils working with prime contractors to encourage opening up of supply chains

Some Potential Changes in EU Directives

• Simplified Prequalification – self declaration / only winner provides detail

• Promotion of e procurement – Fully “electronic” by 2016

• Encourage access to SME’s – Incentives to divide tenders into lots

• Limits on financial capacity requirements (e.g turnover)

Contacts

• Graham Frankland– Assistant Director (Resources)

• David Hart– Strategic Procurement Manager

• Procurement & Contracts Managers– Corporate Contracts Karen Burke– Regeneration & Neighbourhoods Contracts Ursula

Larkin– Child & Adult Services Contracts Terry Maley

• E-mail:- procurement@Hartlepool.gov.uk