New joint procurement product serves customers in a new way

Hansel’s first dynamic purchasing system (DPS) was launched in 2018. The joint procurement procedure, which is reminiscent of a framework agreement, offers customers and suppliers more agile services.

The dynamic purchasing system (DPS) is a fully electronic procurement process. The most major difference between a framework agreement and a DPS is that new suppliers can be introduced throughout the agreement period in a DPS.

“A joint procurement being open to new suppliers at all times, instead of just during tendering processes arranged every four years, is a major benefit to service providers. It means that you can apply or drop out at any time,” explains Susanna Närvänen, Chief Category Officer.

The flexibility also offers new kinds of benefits to the customers.

“For example, DPSs that offer expert or consulting services can be developed by adding new, up-to-date expertise throughout the agreement period, because new suppliers can be added at any time. The selection of suppliers in a DPS is done through an internal tendering process. For the customer, it does not matter whether mini-tendering is completed through a framework agreement or a DPS. Hansel’s ready-made document templates and the procurement support unit provide assistance in both cases. The procurement support unit advises the customers on how to complete the tendering process and comments on the invitation to tender. A customer may receive more offers through a DPS than through a framework agreement, which should be taken into account already in the invitation to tender. ”

The number of acceptable candidates is unlimited in a DPS, and the candidates are not obligated to pay any charges for their participation in the DPS. A DPS is also more flexible than a framework agreement in terms of pricing.

“Pricing on the market is continuously developed. For example, we arranged IT consulting tendering for the last time during an economic downturn, which resulted in low contractual prices. This caused poor service supply during the following upswing. The DPS on IT consulting was made available to our customers last autumn, and it is more market-based than the framework agreement on services of the same industry,” Susanna Närvänen states.

More DPSs to be added in 2019

Hansel’s selection of joint procurement services was supplemented in 2018 with four new DPSs: one for long-term accommodation services in Finland, one for iOS/MacOS computers, one for IT consulting and one for occupational health care services.

“A DPS can reduce the administrative burden from procurement. For example, a customer had to complete several simplified tendering processes when using a framework agreement for occupational health care services when suppliers for several offices all around Finland were needed. In the case of a DPS for occupational health care services, the customer can determine the regions they want, meaning that there will be only one tendering process per customer. A DPS for IT consulting also reduces the number of tendering processes, because in the case of a framework agreement, a mini-tendering process for each competence area had to be arranged. This reduces the expenses of the customer and the supplier.”

A DPS is not a panacea for all the challenges of public procurement, however.

“A DPS serves the customer and suppliers better than a framework agreement in some cases. However, the way in which a joint procurement should be arranged depends on the customer needs and the market situation. Our initial experiences on dynamic purchasing systems are positive, and we will use a DPS when it serves the customer better than a framework agreement,” Susanna Närvänen says.