The public sector technology procurement market is full of opportunities for suppliers who specialise in tech, including digital tech and emerging technologies. However, if you want to take advantage of the opportunities, you must tackle some bureaucratic challenges.
According to a report from the UK’s National Audit Office (NAO), one of the primary challenges is a procurement process that doesn’t favour digital tech tenders. This is a considerable oversight, considering the government spends £14 billion a year on digital tech goods and services.
The problem is, there isn’t enough centralised data to provide insights into current spending, supplier performance, and market forecasts.
This means that there are no standardised data collection, storage, and analysis systems. It’s all kind of hodge-podge. It also means that there is no standard for evaluation, so many buyers are shooting in the dark.
A possible solution to the problem is to rethink supplier relationships as procurement partnerships and bring collaboration into the tender process. This is included in the Procurement Act 2023. At least the government is aware of the problem and taking steps to resolve it.
Government Departments and Their Technology Needs
There may not be much cohesion in the public sector tech procurement market, but there is a framework used by many public sector organisations to find companies that specialise in technology services.
The Technology Services 4 (TS4) Framework enables contracting authorities to reach pre-approved suppliers. It simplifies the procurement process, so even inexperienced buyers can manage a small public services tender.
TS4 breaks down tech tenders per government body.
TS4 arranges government bodies into six categories.
1) Central government departments
Buyers often use TS4 for large-scale IT projects and various small-scale technology projects.
2) Local government
It’s used for citizen-facing technology services, internal operations, and infrastructure management.
3) NHS organisations
Hospitals, trusts, and NHS bodies procure tech for mission-critical systems, data management, and digital health initiatives.
4) Education institutions
Schools, universities, and colleges tender for IT infrastructure, learning platforms, and admin systems.
5) Police forces
They buy tech for crime prevention. They also buy data analysis and operational efficiency solutions.
6) Other public sector bodies
This includes non-departmental public bodies, charities, and organisations that receive public funding. TS4 doesn’t provide a breakdown of their tech purchases but they are free to use the framework for tenders.
(Additional) Technology Procurement Frameworks
TS4 is only one framework the government uses for technology procurement.
G-Cloud 14
G-Cloud 14 is a Crown Commercial Services (CCS) framework. It’s the largest framework used by the UK government and is especially popular among SMEs.
Digital Outcomes and Specialists 7
Digital Outcomes and Specialists (DOS) is also a CCS framework. It is the primary framework in CCS’s Digital Strategy, which is great for the government’s commitment to digital transformation.
Network Services
Network Services 4 is another CCS framework. It specialises in telecommunications contracts, including WAN, LAN, and IoT.
Mobile Voice and Data Services
Mobile Voice and Data Services does what it says on the tin, although its scope is pretty big, with tenders that cover everything from SMS and international calling to device management and security.
Technology Compliance Requirements
Public sector procurement comes with strict rules and regulations. Suppliers must comply with these or risk being booted off the approved suppliers list. Cyber security and data protection are particularly important because there is a lot of sensitive data floating around and you don’t want to be the one who allows a breach.
Here are a few requirements for technology suppliers.
Cyber Essentials
Cyber Essentials and Cyber Essentials Plus are basic level security certifications that are mandatory if you want to work in the public sector.
ISO 27001
ISO is an independent, globally recognised international standards organisation. ISO 27001 is the standard for information security systems.
Note: There are ISO standards for environmental systems, quality assurance, telecommunication, medical technology, etc. It’s worth looking into standards related to your business because they assure public sector organisations that you’re committed to providing the best and safest products, services, or works possible.
UK GDPR (General Data Protection Regulation)
The UK GDPR is the UK’s post-Brexit adaptation of the EU’s GDPR. It’s largely unchanged, but there are key differences you must know.
The Data Protection Act 2018
The DPA is still relevant, so suppliers must ensure they comply with the regulations in the Act, the UK GDPR, and the Procurement Act 2023.
These are by no means the only regulations that govern public sector technology procurement. It’s up to suppliers to learn more about the requirements that apply to their specific skill set.
Invitations to Tender in Public Procurement
Contracting authorities issue invitations to tender to suppliers they’ve identified as most likely to fulfil the tender’s requirements. ITTs contain all the criteria for the tender, including technical specs, delivery details, and quality standards, etc., so suppliers can tailor their tender responses accordingly.
Let’s look at how to craft a response to make your tech stand out.
It starts with understanding. Understanding the tender requirements and evaluation criteria. This is not the time to fake it til you make it. If you don’t understand something, ask the buyer for clarification. Understanding also includes the instructions. ITTs contain instructions on how to answer questions – the structure and format.
Formatting can be quite specific. It’s not uncommon for buyers to ask for a certain font or font size. It sounds pedantic, but it makes evaluation easier.
Clear and concise answers also make evaluations easier. We know you’re bidding on technology tenders, but don’t shroud your answers in technical jargon because procurers aren’t necessarily familiar with your industry.
Keep it simple and stick to the word count (there’ll probably be a word count).
Don’t do this
A common mistake suppliers make is underestimating the importance of proof. Public sector bodies want to know your track record. Can you do the things you say you can do? Case studies are gold, especially if they include clients’ comments.
Another mistake is submitting tender responses unchecked. Always read your finished documents. Look for spelling and grammar errors, check the flow, double-check word counts, and ensure your answer actually answers the question and doesn’t veer off-topic.
Pricing Strategies for Your Tender Response
Pricing is always tricky. You want to make a profit, but you don’t want to go too high. You don’t want to go too low either, because bang goes your revenue and buyers will be suspicious about the quality of your goods and services.
To calculate a fair price, you need to include all your costs: direct, indirect, and potential risks. Consider the complexity and duration of the contract and, very importantly, include potential cost savings. Especially if they’re the result of your efficiency or the quality of your products.
Let’s look at some pricing strategies.
1) Cost-plus
Probably the most straightforward pricing strategy. Simply calculate direct and indirect costs and add your profit margin.
2) Value-based
Pricing is calculated according to what buyers are happy to pay. This is often quite low and could be a good option for SMEs just starting out.
3) Economies of scale
This works best for bulk buying or large-scale contracts. The more items bought, the lower the costs. For example, you could produce 15 products for £15 each or 150 for £8.50 each.
Remember: With the switch from MEAT to MAT, price isn’t everything. Value is more important. If you can prove that your company provides more value than other suppliers, for instance, you enhance service delivery in local communities, then even though your price is higher, you could still win the tender.
Innovative Partnerships with Public Sector Buyers
Innovation is the name of the game now. The Procurement Act actively encourages strategic supplier/buyer relationships, largely because their potential collaboration could lead to innovative solutions to project challenges.
The Act has barely come into effect, so its effect on technology procurement, including the emphasis on innovation, has yet to be seen. It will be interesting to see how the market develops with collaboration replacing transaction as a procurement strategy.
Meanwhile, time ticks on and there are contracts to be published and tenders to be won. You can find technology tenders – and a lot more besides – on Supply2Gov. S2G boasts the biggest database of public sector contracts in the UK. You can also get Cyber Essentials certified and expert support as your business grows in the competitive public sector market.
Register for free and receive local alerts for technology tenders in your niche. Supply2Gov is pay-as-you-grow, so you can widen your search as your business expands.