Whenever the public sector needs goods, works, or services over a certain value, it is required to publicly advertise this requirement and encourage businesses to compete for the work.

  • Central government procurements over £12,000 (Inc. VAT) must be advertised.
  • Sub-central procurements over £30,000 (Inc. VAT) must be advertised.

This process is referred to as publishing an ‘Invitation to Tender’ or ‘ITT’, and the associated documents have become more commonly known as tenders.

Why are tenders needed?

As the public sector relies on public funding to make decisions, all procurement must be made respectfully, encourage free and open competition, achieve best value for money, and ultimately benefit the public.

These requirements prevent unethical procurement practices, while also allowing businesses, regardless of size, to enter the market. For more information about this, please read our article ‘6 reasons to do business with the Public Sector

What types of tenders are there?

High-Value Tenders, also known as Above Threshold Tenders
These tenders have a value above the UK public procurement thresholds, and must be published on the UK government portal ‘Find a Tender’

Low-Value Tenders, also known as Below Threshold Tenders
These tenders have a value below the UK public procurement thresholds and are much smaller than High-value tenders, making them a great starting point for businesses entering the market for the first time. The procedures for low-value notices are simpler, and bidding for these provides suppliers with valuable experience to help them go after high-value tenders in the future. For more information, read our article ‘Why we love low-value tenders’.

OJEU Tenders
These are High-Value Tenders for the EU. The OJEU (Official Journal of the European Union) is like ‘Find a Tender’ for all EU nations and has its own set of thresholds. While the UK is no longer part of the EU, there are some tenders that UK businesses can still bid for.

Framework Agreements
These are umbrella agreements setting out the terms – particularly relating to price, quality, and quantity – under which individual contracts (call-offs) can be awarded at any point during the lifespan of the framework. Frameworks are typically used when the buyer has identified a need for specific products or services but is unsure of the scope or time frame. The agreements created give buyers access to a range of qualified suppliers, allowing them to avoid the need to continuously re-tender. Being on a framework does not guarantee work, as there may be multiple suppliers offering the same goods, works, or services – in such instances, mini competitions or best value will determine who wins the work. Full details of these agreements can be found in ‘Framework Agreements: What you need to know’.

Dynamic Purchasing Systems (DPS)
Similar to frameworks, however, new suppliers can join at any time, and they are used specifically for goods, works, and services commonly available on the market. A DPS must be set up using the restricted procedure, and the process is required to be entirely electronic. Unlike a framework, there is no limit on the number of suppliers joining a DPS, and any supplier may join during the tender’s lifespan. DPS are used to streamline procurement for both buyers and suppliers, as suppliers only need to demonstrate suitability once, and buyers can award contracts quicker than other methods allow.

How do public sector tenders work?

Open procedure
Is the standard public procurement procedure within the UK. This type of procedure allows any business to respond to a tender, access associated documents, and bid for the contract.

Restricted Procedure
Is a two-stage procedure that involves creating a shortlist of the most suitable suppliers, by having them first complete a selection questionnaire. Those shortlisted will receive an invitation to tender and are allowed to bid for the contract. This type of procedure is generally used if a high volume of bidders is expected.

Competitive Dialogue Procedure
Is a multi-stage procedure that allows discussion with suppliers before issuing an invitation to tender. It is used where procurement needs are complex, and as with Restricted Procedures, bidders will first be shortlisted. After the selection stage, the requirements and solutions will be discussed with shortlisted suppliers. From these discussions, the requirements will be finalized and an invitation to tender will be issued.

Competitive procedure with negotiation
Is a multi-stage procedure that allows negotiation with suppliers after they have submitted their bids. This procedure includes a selection stage questionnaire, and the final negotiation stage is optional – as long as this has been stated within the tender. Much like the Competitive Dialogue Procedure, it is used where procurement needs are complex.

Innovation partnership
Is a unique procedure that is used when no goods, services, or works exist to meet the procurement need. Selection stage questionnaires are used to identify the most suitable suppliers before invitations to tender are issued. The products produced as a result of this partnership may be purchased by the public body, but only if they meet the minimum requirements identified within the tender.

How long do I have to bid on a tender?

The length of time you have to bid for a tender depends on the type of procedure being used, and when you are made aware of the opportunity. To help you get a better understanding of how much time is available to you, and the actions you need to take before the deadline, the following links have more information:

How do I find public sector tenders?

You could use a search engine or check the websites of public sector buyers, but as there are over 900 portals used to publish contracts – the time and effort involved make it an impossible task to manage effectively. Tenders Direct makes accessing the market easy. We collate every tender from the UK, Republic of Ireland, and Official Journal of the European Union (OJEU) in one place, and send email alerts whenever relevant opportunities for your business are published.