Business Development

What is a Dynamic Purchasing System?

By Hudson Procurement Group
June 2020

Here we go again – another term which is not well known in all industry sectors across the UK – a Dynamic Purchasing System.

As always, we are here to help you understand all these ‘niggly’ bits to tendering, to ensure you are prepared to undergo some serious business development planning across your sector and beyond!

You can see the different bidding terminologies applicable in our ‘Tendering doesn’t have to be complicated’ blog.

In a nutshell – a Dynamic Purchasing System (or DPS for short) is basically a supply chain list where tenders or other bidding opportunities are published to specific members that have been successful in maintaining a position on that list.

As quoted in the Public Contracts Regulations 2015, “[a] DPS should be set up for identified types of requirement, which may be divided into categories of products, works or services.”

This could be any organisation or group of organisations, who wants to outsource work in either one or more service areas [or LOTs] and rather than having 50-100 applications come through for the [potentially many] tenders they publish, they start by narrowing down a set-list of applicants onto their own DPS.

Differences between Dynamic Purchasing System & General Tender processes

The main differences from the typical tender process are that a Dynamic Purchasing System is to:

be run as a completely electronic process (no paper or posting required here)
allow new suppliers to join at any time (meaning that if you have been unsuccessful at securing a place – you can always try again in the future)
and show longevity in its run (we’ve come across DPS’s which are open for 10 or more years)

All that suppliers would need to do, is register their company onto this DPS online, click which service area they are interested in delivering and undergo a Stage 1 submission in order to secure a place. Once secured, Stage 2 is the actual tendering of the works in question.

For example – A Housing Association could create a DPS for their outsourced Creative activity, which includes a range of service areas/LOTs – i.e. Branding, Printing, Website Hosting etc. They would publish this DPS opportunity to all and then undergo multiple stages to narrow down the process of awarding the work via the ‘most economically advantageous tender’ (MEAT).

Stage 1

In the average UK tender process, a lot of suppliers may be asked to complete a Pre-qualification Questionnaire (PQQ) to help the buyer narrow down their list of Invitations to Tender (ITT). This is now being taking over by a ‘Selection Questionnaire’ on many portals. It’s similar with a Dynamic Purchasing System – the supplier has to get onto the DPS in order to be Invited to Tender for works and they do this by completing a Stage 1 application process that heavily resembles a PQQ, with maybe a few additional questions thrown in.

Like a typical PQQ-to-ITT process, securing access to the DPS reflects a ‘weed-out’ procedure, with the buyer ensuring they progress all applicants who demonstrate greater strengths in their financial, technical and professional capabilities.

Stage 2

Once you are successful and Stage 1 is complete – it is complete. You do not have to re-do any capability and competency-based questions. Every time a tender is published in relation to your service area, as part of this Dynamic Purchasing System, you are automatically invited to tender and answer all questions specific to that service!

Once on the DPS then a range of tenders will then ensue (as and when required), allowing the buyer to streamline a more technically-focused evaluation on the responses collated.

Where we stand in all of this!

Our Discover platform has many traits of a Dynamic Purchasing System, in that a buyer, let’s, for example, say a Design agency on our Creative Tenders portal, seeks a professional company who can support their financial/accountancy needs. All that the Design agency would do is:

Log on to Hudson Discover

View a list of our Finance Tenders subscribers, which encapsulates a large list of Accountancy firms
Publish their ‘private opportunity brief’ to a filtered list of suppliers
Receive responses, evaluate and award.

The reason we filter this list is to avoid publishing opportunities that bare minimal relevance to our suppliers and streamline the process for our buyers, helping them publish specific competitive opportunities to the most competent suppliers.

So, if you ever come across a DPS that contains services specific to your offering – get on board.

Our Consultants can help you succeed!

For more information or to speak to a consultant, please visit our website.

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