Everything you need to know about a framework agreement

Framework Agreements

Securing a place on a framework, or being a preferred supply partner, can offer a multitude of benefits to both a buyer and a supplier. A framework agreement is a tool. It it getting your business approved, in order to then win work.

We explore the advantages and disadvantages, whilst explaining what a framework agreement is and how you can find these lucrative opportunities.

What is a framework agreement?

A framework agreement is a type of contract that is commonly used as a multi supplier agreement, establishing a long term relationship to deliver works as an approved supplier for the buyer.

For example, a Council has a range of works to be completed by a group of suppliers, contractors or service providers. Setting up a framework agreement will be an efficient way to work, without having to go through the tender process each time.

Similar to a tender for a contract or ITT, the framework tender is usually a mix of quality and price. The buyer will then review all framework bids and approve a specific number of bidders to be awarded a place on the framework.

Then, when the buyer has a requirement or specific project, they will usually run a mini competition or call off, which reduces the timescales and complexity of awarding specific works.

Alternatively, some frameworks allow a direct award, so no mini competition or call offs. Work could be awarded to a bidder based on a geographical lot which has already been agreed as part of the framework agreement. Some frameworks also award based on performance, which will be measured throughout the partnership.

Advantages of a framework agreement

From the bidder/suppliers perspective;

• A framework agreement is a great way to work with public sector bodies. Once approved and EU compliant, it can hold credence to secure future public sector work, both via a framework and individual project contract.
• It can help nourish a long term partnership with the buyer, and potentially other similar buyers.
• Depending on the framework agreement, if estimated values of work are known, they can provide a healthy long term revenue stream for a business, supporting cash flow and business planning for 3-5 years.

From the buyers perspective;

• The reduction of going through a tender process for each individual aspect of work can offer significant benefits for the buyer. This includes; administration time and costs, potential discounts and savings from suppliers, a more defined and planned approach and trusted expert partners.

Disadvantages of a framework agreement

From the bidder/suppliers perspective;

• Many bidders will invest time and costs to be awarded onto a framework and then potentially not receive any work through them. So, first of all it is important to weigh up or discuss with the buyer how much work is likely to be going through the framework. If it is a renewal of a framework, you can review how the partnership has been over the last 4 years.

• Once awarded a place on a framework, you can’t just wait or expect the phone to ring. You still need to work hard, to get your share of it! This may involve networking at organised events for suppliers, or traditional sales and marketing – but the benefit being, you are already approved to work with them. If, or when, the phone does ring there can often be a short window of time to turn the project around, this can sometimes be exhausting on business resources.

From the buyers perspective;

• Many bidders will invest time and costs to be awarded onto a framework and then potentially not receive any work through them. So, first of all it is important to weigh up or discuss with the buyer how much work is likely to be going through the framework. If it is a renewal of a framework, you can review how the partnership has been over the last 4 years.
• Once awarded a place on a framework, you can’t just wait or expect the phone to ring. You still need to work hard, to get your share of it! This may involve networking at organised events for suppliers, or traditional sales and marketing – but the benefit being, you are already approved to work with them. If, or when, the phone does ring there can often be a short window of time to turn the project around, this can sometimes be exhausting on business resources.

Framework Agreement Supplier Submission Requirements

Responding to a framework agreement can be similar to responding to a tender. However, tender submissions will require your specific approach, solution and price, compared to a framework, which requires a more general overview of your 'typical' solution, for example. To highlight these differences, we've created a comparison table that outlines the key elements typically asked of bidders in each scenario.

Comparison Table: Framework Agreement vs. Invitation to Tender (ITT)

As the table illustrates, a framework agreement bid requires suppliers to demonstrate their broad capabilities, flexibility, and capacity to deliver a range of goods or services over an extended period. In contrast, an ITT bid as part of a tender submission is more focused on meeting exact specifications, timelines, and deliverables. If you take a 'framework submission' approach to a specific tender it is unlikely you will be successful. The tender feedback will be - "too generic".

Types of Framework Agreement in Procurement

In the UK, both public and private sector organisations use various types of framework agreements and supplier lists to streamline their procurement processes, ensure consistent quality, and achieve the best value for money.

In the public sector, there are two main types of framework agreements:

1. Single-supplier framework agreements: This type of framework agreement is established with a single supplier who has been selected through a competitive tendering process. The terms, conditions, and prices are agreed upon in advance, allowing buyers to place orders directly with the supplier without further competition. These are quite often used as neutral vendor solutions to allow a public sector body to purchase almost anything through a single supplier.
2. Multi-supplier framework agreements: In this type of framework agreement, multiple suppliers are appointed to the framework following a competitive tendering process. These are what most businesses bid for. The framework agreement sets out the general terms and conditions, but the specific terms, such as price and quantity, are established through a secondary competition among the suppliers on the framework. This allows for more flexibility and competition within the framework.

Framework agreements help public and third sector buyers procure goods and services from a list of pre-approved suppliers, with agreed terms and conditions and legal parameters set out in advance. This streamlines the procurement process, saves time and resources, and ensures compliance with UK procurement regulations.

In the private sector, organisations use similar arrangements, such as approved supplier lists (ASLs) or preferred supplier lists (PSLs). An approved supplier list is a carefully chosen group of vendors that a company works with regularly. These suppliers have been vetted and meet specific quality, delivery, and pricing standards set by the organisation. By maintaining an ASL, companies can streamline their procurement process, reduce risk, and ensure consistent quality of goods and services.

They all allow businesses to make better purchasing decisions and maintain strong relationships with their most reliable and cost-effective and high-performing suppliers.

The National Audit Office: Procurement & Framework Assessment

The National Audit Office report on "Efficiency in Government Procurement of Common Goods and Services" provides crucial insights for suppliers bidding for public sector contracts.

The public sector spent around £393 billion on goods and services in 2022-23, with £125 billion dedicated to common goods and services! This substantial market offers many opportunities for suppliers, especially within the framework agreements managed by the Crown Commercial Service (CCS), for example, which oversaw £25 billion in spend through 238 frameworks.

The report highlights the increasing use of frameworks, with 72% of large contracts procured through them in 2021-22, up from 43% in 2018-19. This trend underscores the importance of frameworks in achieving economies of scale and competitive pricing.

Suppliers should be aware of the government's push for greater aggregation of demand and collaborative procurement. This approach aims to maximise purchasing power and achieve better value for money, making it vital for suppliers to offer competitive pricing and innovative solutions. Therefore, if you want to win contracts in the public sector, frameworks are a key tool.

Levy rates charged by framework providers can impact pricing strategies. While CCS’s average levy is 0.7%, other providers charge higher rates. Suppliers must account for these costs when developing their bids and with a push for aggregation and lower fees, your choice of framework may get increasingly important.

Framework Agreement Frequently Asked Questions

What’s the difference between a framework agreement and a contract?

A framework agreement rarely provides any specific commitment in terms of project and value of works that you have won/secured. It is more focused around being an approved supplier, allowing you to be awarded work during the period the agreement lasts.

On the other hand, a contract is usually a specific fee, with project scope and timelines allowing you to quote and tailor your product/service for the specific job at hand.

Is a framework agreement legally binding?

It is a legally binding contract in terms of the bidder carrying out the works in line with the agreed terms and conditions documented.

A framework usually provides a guide of how much work, and the value, they expect to run through the framework agreement. However, it rarely provides a commitment to this.

How long can a framework be?

Typically, a framework agreement lasts for 4 years. However, this is determined by the buyer. They can range between 2-10 years.

Is a framework agreement different across sectors/industries?

For example, Public Sector framework agreements or construction framework agreements?

They can be slightly different depending on the sector and service, however the same rules apply across the board.

How buyers award work can also vary depending on what the framework is for. For example a service based opportunity may prove difficult to allow a direct award, so the framework would need to be set up to allow for mini competitions, whereas a product may be offered via a direct award.

All UK public sector frameworks will be in-line with the Public Contract Regulations, which are being superseded by the Procurement Act. This allows every relevant business the opportunity to bid to be on the framework and be a preferred supplier.

Where to find framework opportunities?

We have a purpose built software, Tender Pipeline, that features all public and private framework agreement opportunities. You can quickly and easily search for opportunities and sign up to receive relevant alerts, supporting you to be well prepared in advance. At the bottom of this page you can see live framework agreements which are provided by Tender Pipeline.

As mentioned above, framework agreements can last for anything between 2-10 years so it is important that you stay up to date and are aware of future opportunities at the earliest stage to ensure you don’t miss a significant opportunity.

Frameworks can be set up by a specific buyer, for example a University focused only for their specific use. Others are broader such as ESPO, Yorkshire Purchasing Organisation, Crown Commercial Services, Procurement for Housing etc. These will set up frameworks for their members, which may be groups of housing associations or schools, for example. So once approved and successfully awarded onto their framework you will receive mini competitions and therefore have access to a much larger group of clients.

How to win a framework agreement

You should approach a framework as any other tender or contract opportunity. You should invest time and resources to fully understand it, including what the buyer wants and expects, appreciate your competitors strengths and weaknesses, and how you can seek competitive advantage.

We also advise to consider what compliance elements may be required so that you can plan for them. For example; what training will your staff need? Does the business need additional certifications? What experience and evidence is relevant and can you start planning for it, prior to the tender being advertised. Planning is key!

If you require additional advice, or bid writing services contact one of our experts today and discuss your requirements.

There are a lot of framework agreements suitable for my business. How do I choose which is the best to bid for?

This will come down to your bid-no-bid decision. Is it right for your business? For many of our clients we will be able advise and guide on which frameworks have more demand than others, so are worth investing time into getting approved on.

They also have difference uses. National procurement framework agreements with ESPO and CCS for example. However, a local Council or University may also have a framework agreement purely for their requirements.

Some frameworks are often used as a route to push existing clients through - to ensure compliance but may be less useful at bringing new customers to you! Lots to consider and we are happy to advise.

My Sales Team keep being asked if we are on a framework and that they can’t work with us unless we are. What does this mean?

Good news! If the public sector is asking your sales team if you are on a framework agreement, this is certainly a buying sign. They are trying to understand if they can work with you. Bad news of course, if you are not on a framework and can’t offer them the procurement compliance and reassurance they seek.

When asked if you are on the framework, this means are you on the approved list which they use. Within our frameworks section on our website we have a vast amount of information on finding framework, bidding for frameworks and how to use them to your business advantage.

As a bid writing consultancy, we can help you identify the key frameworks you need to be on, as well as often providing your sales team who are speaking to public sector buyers, a quick fix in the interim! You have several options including using dynamic agreements or market places, which are often continually open to new suppliers or even existing neutral vendor solutions. In the latter case, this would involve you become approved as a subcontractor with an organisation which can provide almost instant compliance. Positives and negatives with both approaches which are we happy to advise on and offer our opinion on the best routes forward for your business in winning public sector contracts and further understanding framework agreements in helping you win government tenders or contracts.

What do I need to get onto a public sector framework agreement? Is this the same as a government tender?

If you are familiar bidding for government tenders, you should feel more comfortable when trying to win a place on a public sector framework agreement. Frameworks are all different, for example, some are focused on compliance allowing for an unlimited number of suppliers. With this example, quite often these government opportunities can prove to be a useful tool for businesses looking to grow their businesses government tenders. However, they will not be offering you a commitment; see it more as an approved suppliers list. Compare this to a highly competitive framework which requires both compliance but with a limited number of suppliers per lot or region, you need to carefully consider your ability to win a place and then invest into your bid, whether this is with outsourced bid writing consultancy or in-house.

In summary however, in order to successfully win a place on a government framework agreement to supply public sector bodies and win government tenders you need:

• Providing a compliance bid response

• Relevant experience and expertise

• Share the ethics and commitment of the public sector, for example, modern slavery policy, carbon reduction plans and other wider policy commitments. Carbon Reduction Plans are an increasing compliance requirement and something we can support you with. Click here for further information on the importance of Carbon Reduction Plans for winning public sector bids

• Commit to the terms of the framework agreement and that required by government procurement.

In some sectors, which are severely lacking in skilled workers, for example, many framework agreements will be very accessible for organisations with minimal barriers for new suppliers. This can be the case with domiciliary care tenders and frameworks, for example. We provide bid writing top tips and further information on this in our healthcare tenders page.

We spent a long-time bidding for a government framework, and we were successful. However, that was 9 months ago, and I still have not won any work, it’s not generated any sales. Am I doing something wrong?

Over 70% of public sector spend with suppliers goes through government framework agreements, so they are critical to understand and get right. They should be forming part of your public sector bid strategy. Click this title to find ‘Everything you need to know about a framework agreement’ and by understanding government procurement rules you can inform your bid writing and success in work-winning with the public sector. This alongside, ‘The Ultimate Guide to Selling into the Public Sector’ will really help your better understand how to make the most from the frameworks you are on.

With the success and continuing focus on frameworks by government procurement teams, the number of frameworks available is now vast. Choosing the right framework is essential. We help our clients through our bid writing consultancy services, by analysing spend through frameworks and advising on which framework agreements are right for your business. Framework choice is one thing.

Quite often is you being on a framework which you know is right for your business, but you still are not getting business from it; you aren’t growing your business in the public sector. We have seen occasions where this is an administration oversight within the portal; when submitting your public sector bid it might be a tick box stating how you can be contacted hasn’t been completed, or an email address has been used which is no longer in use! This should be your starting point – ensuring you are set up on the framework agreement properly in order to be invited to bid for mini competitions with the public sector.

Usually once a framework is awarded there is further engagement and events with suppliers; have you had these? If not, send a message to the government procurement team or framework management organisation. We provide an overview of key national framework organisations within our central framework agreement page. You need to explain you have been on the framework for 9 months but have not had any opportunities or that you are struggling to win work. They will be able to provide you advice on how others use their frameworks in order secure government contracts and tenders.

If you are not winning mini competitions or call-offs from a government framework agreement it could be you need to improve the bid, you are submitting for these opportunities. They are still a competitive exercise and require a compelling and persuasive bid. Take a look at our ’10 Ways to Improve Tender Response Scores’ which could really help your return on investment for government tenders, public sector bids, framework wins and the associated further competitions.

The other reason why you may not be winning work from the framework agreement you successfully won a place on, is because of how typically the framework is used by government procurement and suppliers. Some framework agreements or Dynamic Purchasing Systems (DPS agreements) only allow further competition, which is via a call-off or mini competition. This is the process used by public sector bodies to engage with approved framework suppliers with a specific need. This require a specific proposal but only those approved on the framework are invited. If you are on a government framework agreement you should receive notification with regards to these opportunities.

However, many framework agreements are often used for their ‘direct award’ abilities. This is whereby the government can justify directly awarding a contract to one supplier on the agreement and win the government tender but without a further public sector bid. The government procurement team still needs to ensure they are achieving value for money and there is a valid reason for this award, but it is a popular route for winning work in the public sector.

Many businesses make the direct award process part of their public sector engagement and sales strategy. By building up relationships and then offering a compliant procurement solution there is potential to avoid having to submit a further public sector bid.

Frameworks such as G Cloud are well known for fully using this benefit. We detail the benefits of G Cloud 14 framework, which included direct award. This is focused on cloud-based software and associated consultancy; however, we often advise clients on suitable options based on their specific sector. As a bid writing consultancy focused on helping our clients win public sector tenders through the formal government procedure process, we fully understand the important of wider research and fully understanding the market in which we work.

I have a public sector client who wants to work with us but can’t because of the government procurement process. What options do I have?

This is a very common challenge and frustrating for both parties involved. Quite often they will ask what frameworks you are on to assess whether there are any quicks which could a direct award from a public sector framework agreement or even a direct award, so therefore no further competition! Which is of course the perfect solution if you are a supplier. If they haven’t asked but you are on a government framework, which they could use it is important to put this option forward. If you aren’t on a framework now and depending on the timeframes there could be a suitable option for you to discuss with them and quickly bid for – it’s always worth a look. We provide a vast array of details and framework options in our frameworks blog. Frameworks are open once and then typically closed for 4 years, however, a dynamic purchasing system (DPS) can often provide the same benefits as a framework but continually open, or regularly re-opened to new suppliers. For more details on DPS agreements and how they can be used by public sector suppliers as a tool to win government tenders, can be found in our dedicated DPS blog.

If there is concern over the use of a framework by your public sector client and they have committed to a bespoke and full procurement exercise the preparation can take anything from a few months to well over a year for them to ensure they are ready to advertise the requirement. Quite often they will need your expertise as the incumbent supplier in order to create this government tender pack. Including TUPE information, specifications, measurements, mapping, satisfaction figures etc. As well as wider areas such as challenges relating to the contract delivery and the associated risks. This is an excellent chance for you to influence the tender requirements, specification, prior to the formal tender or contract notice, advertising the tender. This is the public sector procurement team’s market assessment stage and an important part of their procurement process. Your job is to work closely with them, ensure as far as possible it is a good fit for your business when the government tender is advertised. Including questions being asked but also pricing frameworks and sustainable routes for managing inflation for example within the contract.

While this procurement preparation is taking place, and as the incumbent supplier it is critical you start preparing for your upcoming public sector bid now. Collating case studies, proposing initiatives which add value for the client and also create evidence to support your bid. Collate and report on KPIs and ensure any performance concerns are remedied as far as possible.

Live UK Framework Agreements