GATE 3: ROUTES TO MARKET TO SCALE
How to adopt a procurement procedure that is appropriate in scope when ready to scale.
Following the discovery stage and/or Preliminary Market Engagement, users should be sufficiently informed about which route to market would be most suitable to scale an innovative solution. For high-value procurements that are above the threshold, Public Contracts Regulations must be followed. Procurement Act 2023 has simplified processes where there are two procedures to follow. These processes ensure all suppliers are treated equally when bidding for a contract.
This section offers knowledge and guidance for public-sector professionals on:
Competitive Flexible Procedure
The Competitive Flexible Procedure (CFP) consolidates all previous multistage procedures into a single framework.
Where a range of multistage procurement processes were previously in place, CFP is designed to encompass all such procedures but with less stringent rules. It shares many similarities with the Innovation Partnership Procurement process (outlined below) and can include the discovery/R&D stage and scaling. CFP therefore allows procurers to design the procurement process with a more innovative and commercially oriented approach.
With the introduction of the Competitive Flexible Procedure, some of the limitations of previous regulated procedures may be addressed through a more adaptable approach.
Notably, CFP permits modifications to tender criteria, enabling contracting authorities to refine award criteria before the final tender submission deadline—provided that any changes are not "substantial" and are clearly outlined in the initial tender notice or associated documents. This ensures that significant alterations, which could materially affect supplier participation, are not allowed.
Overall, this streamlined and flexible bidding process, with fewer complex rules and shorter timelines, can lead to better value for money and faster project delivery.
What are the limitations?
The procurement regime will continue largely as before. Procurers may still utilise the same multistage templates and processes just under CFP
Additional Resources & Support
- GOV.UK
The new Competitive Flexible Procedure guidance under the Procurement Act 2023 details a more adaptable approach to procurement. Through an e-learning series, it explains how contracting authorities can design bespoke, multi-stage processes, offering greater flexibility than the rigid Public Contracts Regulations 2015 to better meet organisational and local needs. Additionally, read the example processes, including the two-stage process and multi-stage processes under CFP. - Read IPEC’s The Art of the Possible: Unlocking Innovation Through Procurement report to explore how the Procurement Act 2023 can drive innovation across the public sector.
- Read this article which explores how smart procurement strategies can drive government growth plans, offering insights into leveraging innovation-friendly approaches to achieve economic and societal goals.
Open Procedure
Open Procedure is a one-stage procurement where bidders must respond to all the tender questions. This means that any organisation can respond to the advertised Contract Notice and submit a tender. This can be most appropriate if research has shown that there are relatively few bidders who could meet the solution needs.
What are the limitations?
- As it allows anyone to respond to all of the tender, the process may receive bidders that are not able to meet the requirements.
- Unlike Restricted, it is difficult to predict the number of tenders to be assessed.
Frameworks
Frameworks are often the first go-to procedure to consider for public procurers. They offer an established list of compliant suppliers where a mini-competition needs to be carried out — according to the call-off terms of the framework — in order to select and award a supplier.
Commercial frameworks under the Procurement Act 2023 are more open to prospective suppliers. Previously, once the framework was awarded, for the entire term of the framework only those awarded at the beginning can be called off under that framework to participate in a mini-competition. There is now the option for new suppliers to join the framework at least twice during the term when the framework reopens for new entrants to join. Open frameworks will also be permitted to run for up to eight years - twice the length of most traditional framework agreements.
Key features
- Open frameworks offer greater flexibility, which can be particularly useful for rapidly evolving markets with new entrants.
- The process of selecting a supplier from a framework is streamlined, with a requirement to use a competitive selection procedure unless direct award is clearly justified.
- Open frameworks can potentially last up to eight years which should be periodically reviewed and updated.
What are the limitations?
- Still limited to suppliers on framework.
- The contracting authority have to resource when periodically opening up the framework during the life of the contract and there may be additional resource required to manage what is an open framework.”
Dynamic Markets
The new Dynamic Markets replaced the lesser-used dynamic purchasing systems (DPSs) that exist in the current regime. This offers an even more flexible way for public sector to procure by creating a list of pre-qualified suppliers who can be readily accessed for future contracts.
The key changes include the ability to add new suppliers to the market at any time, a requirement for a new tender notice for each contract awarded, and the potential to remove suppliers from the market if they become non-compliant.
Key features
- Greater competition and quicker procurement processes compared to the older regime.
- Open Market – with suppliers being added at any time this demonstrates agility and is particularly advantageous for new start-ups and SMEs growing their business.
- Contracting authorities can choose to undertake any procurement through a Dynamic Markets.
- Suppliers face consequences for non-compliance.
What are the limitations?
- Authorities may be wary of the resource required to add new suppliers to a Dynamic Market.
- Additional contract management may be required.
Where to go for support?
- Crown Commercial Service
Crown Commercial Service (CCS) is committed to making public-procurement accessible and efficient. CCS provides access to over 100 Commercial Agreements, including standardised contract terms, buyer guidance, and a list of pre-evaluated suppliers. Suppliers are encouraged to bid for positions on CCS Frameworks, which specify quality standards and may also include requirements for buyer assurance, social value considerations, and carbon net-zero targets. - G-Cloud 13
Additional CCS resources include the G-Cloud 13 online catalogue, used by public-sector organisations such as government departments, health and emergency services, and educational institutions to procure cloud-based services (to be replaced by G-Cloud 14).
Additional Resources & Support
- Read this guidance by Cabinet Office on the use of frameworks under the Procurement Act 2023, outlining key principles, requirements, and best practices for public-sector procurement.
Concessions
Concessions form a consideration in a contract and consist of the right to exploit the work, or services, that are the subject of that contract, or that right to exploit together with a payment. Examples of concessions might include car parks built on local authority-owned land, or toll roads and toll bridges.
This procurement is valued by the potential income the economic operator (concession holder) may gain. A significantly higher threshold applies compared to standard services procurement — details of these thresholds can be found here: Procurement Policy Note 11/23 – New Thresholds (HTML) - GOV.UK. The agreement is expected to encourage long-term partnerships and can help deliver income for the authority.
What are the limitations?
- In some circumstances it is very hard to value the true potential. There is also inherent risk that the concessionaire must be taken and requires capital investment. The supplier is responsible for managing the concession.
- As they are often associated with a company operating on government property, concessions may be more susceptible to public scrutiny.
The procurement rules governing concession contracts in the UK are contained in the Act, which replaces the repealed Concession Contracts Regulations 2016. Concession contracts are defined at section 8 of the Act.
Where to go for advice?
- Internal teams within your organisation
The procurement frameworks and procedures outlined above serve as general guidance. It is essential to seek professional advice from the relevant procurement team or consult an organisation’s internal policies to ensure compliance with specific requirements and alignment with relevant regulations.
Additional Resources & Support
- Read this e-learning module, drafted by the UK government, which provides guidance on the Competitive Flexible Procedure under the Procurement Act 2023.
- The Crown Commercial Service provides essential insights into the Procurement Act 2023 and its impact on public sector procurement in the guidance How to Prepare for the Procurement Act 2023.
- The Crown Commercial Service has published Prepare Your Organisation for Transforming Public Procurement, providing guidance on adapting to upcoming procurement reforms.
- This UK government guidance explains Dynamic Markets under the Procurement Act 2023, covering their purpose, benefits, and implementation.
- Read IPEC’s The Art of the Possible: Unlocking Innovation Through Procurement report to explore how the Procurement Act 2023 can drive innovation across the public-sector. Building on the principles of its 2016 predecessor, it highlights practical strategies for using the new legislation to deliver innovative, value-driven public services. With insights into overcoming common challenges, it provides clear, actionable guidance for policy makers, procurement professionals, and leaders. The report features seven short case studies and highlights creativity, compliance, and strategic thinking to transform public procurement, enhance services, and drive the UK’s innovation economy.
- Read this case study available on IPEC’s website to learn about MCA’s innovative thinking around frameworks for using drones for maritime surveillance.
- Read this case study available on Transport For London’s website to learn about Innovative new technology set to make roads in London safer and smarter.
- Read this case study to discover more about Royal Mail trial to reduce emissions by using electric vans equipped with specialised tyres.
Pre Procurement Act 2023 (Appendix)
These multistage procedures were regulated under the Public Contracts Regulations 2015 (PCR 2015). The procedures outlined below will no longer be used under the Procurement Act 2023; therefore, this section has been greyed out. However, they are likely to be referenced referenced within the Competitive Flexible Procedure (CFP), as CFP consolidates these multistage procedures. For example, CFP may incorporate elements of Innovation Partnership Procurement.
Innovation Partnership Procurement (IPP)
This approach supports the development of a specific innovative solution to an existing problem and subsequent purchase of the resulting supplies. It allows for R&D with the partner(s) funded through the contract. IPP is more appropriate for high-value high-risk procurements with substantial investment from the authority and competition from the market
The process includes the trial and scaling, plus the authority can appoint one or several partners. The partnership approach promotes a long-term supplier relationship where innovation can evolve.
Restricted Procedure
Restricted Procedure is a two-stage procurement process where bidders first respond to a Standard Selection Questionnaire (SSQ). This first stage is open to all suppliers to respond. Following which, only the down-selected suppliers are then taken through to the second stage to respond to the more detailed technical and price questions. Only bidders with the best capability and capacity will therefore need to complete that second section and be assessed.
Competitive Dialogue and Competitive Procedure with Negotiation (CPN)
Both are a multistage procurement process that typically follow a restricted procedure with two further stages — the Negotiation or Dialogue and the invitation to submit a Final Offer.
With CPN, the authority can skip straight to award if negotiation is not required following initial bids. This is not possible in a Competitive Dialogue procedure.
Competitive Dialogue is particularly suited for when the requirement is complex or not fully definable, as can happen with innovation. The contracting authority continues the dialogue until it can identify the solution that is capable of meeting its needs. For competitive dialogue, the regulation requires the use of process to be fully justified.
The negotiations and dialogue can help improve the bids and ensure that the enhancements form part of the submission and therefore the contract.
- Visit Gate 2: The Procurement Act 2023 to explore the changes coming with the new regulations.
- Click here to access further support that defines the key terms and jargon found in this tool.
Related articles
How SBRI helped Belfast City Council transform problem-solving
Geofencing: innovative technology to improve trackside worker safety
Definitions: Glossary of Terms
Did you find this information helpful?
Your feedback is invaluable. Please share your thoughts to help us improve the tool.