What is a mini-competition in procurement?
A further competition, previously known as a mini-competition, is a procurement process in which awarded suppliers on a framework produce a tender that outlines how they can meet the customers needs. A mini competition is basically a competition needed to secure a place on a call off contract. A call-off contract is an individual contract that falls under a framework agreement. In basic terms, a supplier needs to win a mini competition for a place on a call off contract within a framework competition agreement.
During the tendering process, the term mini-competition may crop up frequently. A procurer may run a mini competition to refine their requirements while retaining the benefits offered under the collaborative agreement.
When running a mini competition, a procurer must do several things such as:
- Comply with the terms of the framework agreement
- Decide on the level of service they want
- Decide on how they will assess the bids following any rules the framework noted
- Choose if they want to run an expression of interest process.
(This is not an exhaustive list)
Benefits of running a mini-competition under a framework agreement
The first benefit is speed. A mini competition saves time when procuring a good or service. A supplier does not need to re-submit a full tender submission, if they are already on a framework.
This saves time for both suppliers and buyers, as the buyer does not need to evaluate a full tender submission again.
The supplier will have already passed the minimum eligibility criteria (e.g. such as financial standing and health and safety requirements). Therefore there is no need for the buyer to assess suppliers’ capability or capacity.
Another benefit is savings. Through mini competitions buyers can receive additional cost savings. This is due to the pricing not being fixed or it is fixed at a minimum level. It is important to remember this when pricing services or works. Although it is important to price the service competitively, it is important not to undercut competitors too much. This may lead the buyer to question legitimacy.
Increased competition and options is another added benefit. Mini competition can create opportunities and increased competition from suppliers. This allows buyers to reassess the supplier on the framework and pick their favourite option.
A buyer will be seeking bids that achieve the best value when hosting a mini competition. They are often able to achieve it because of specific requirements. It is important to remember this when pricing the services and writing the responses.
Continuing on from the best value, mini competitions allow buyers to refine their requirements. Buyers may have refined their requirements during the initial framework agreement, but a mini competition allows them to refine it further. Further than the basic contract terms.
Step One: The invitation to tender (ITT) is issued for a call off contract
A buyer will release an ITT for mini competition for the call off contract. Although they cannot change the basic terms or specific from the framework agreement, they may change:
- Delivery timescales
- Payment or invoicing arrangements
- Associated services such as training, installation and maintenance
- Functional specification
As mentioned before, a buyer can refine the basic terms of the framework agreement when making a call off contract. Any and all important information of the contract will be stipulated in the specification.
This may not necessarily be in the form of an ITT as it could simply be an invitation to quote (ITQ). This is regularary the case as suppliers have already submitted their quality submission to get on the framework. If a buyer wants to know how many suppliers are interested in bidding, then they can issue an EOI. An EOI is an expression of interest. If there is interest as a supplier, a response can be submitted. A buyer will then send their ITT to the suppliers who responded.
Step Two: Write and Submit the Response
Once a supplier has read all of the tender documents, they can start with their response. The format and what needs to be included will be stated within mini competition tender documents.
Step Three: Evaluation
The bid documents will state how the mini competition will be evaluated. A buyer is not able to use award criteria that were not included in the original framework. Depending on the buyer, the evaluation can be done using MEAT or the lowest price.
If being assessed via the lowest price, a buyer will first assess a supplier’s ability to meet their needs. This will be outlined in the specification. It could include the quantity of the goods or services or services required. It would be at this point, they would consider the price. If there are several suppliers who meet their requirements, then the call off may be awarded to the lowest price quoted. This is dependent on the buyer. This type of evaluation is more likely to occur in the private sector.
If a buyer is assessing a mini competition using MEAT a supplier’s responses for quality and price will be evaluated. The exact criteria that they will use to judge be listed in the specification.
Step Four: Contract Awarded
Once all the submissions have been evaluated by the buyer, the call off contract can be awarded to the supplier of choice. All bidders will be notified of the outcome.