Procurement at MOD
Find out about Procurement at MOD and doing Business with Defence – information for those looking to become a supplier or contractor.
Who we are
The MOD is one of the biggest public procurement organisations in Europe, managing some of the most complex and technologically advanced requirements in the world. We are UK industry’s single largest customer, buying everything from military fighting vehicles to education services and all kinds of facilities management services.
What we do
We support our Armed Forces by providing world-class solutions for delivering national defence and security for the UK whilst ensuring the best possible value for the taxpayer.
Our procurement activity covers a very wide range of requirements, including:
- Technology: cloud and digital, network services, software and technology products and services
- Equipment and Support: ships, submarines, aircraft, vehicles, weapons, missiles, commodities and support (maintenance and repair)
- Infrastructure: construction, hard and soft facilities management, property consultancy.
Our Supply Base
The Strategic Defence and Security Review (SDSR) 2015 committed the UK to spending a minimum 2% of GDP on defence over the next decade. This commitment represents spending some £178Bn on defence equipment and support over that period. In 2015/16 MOD spent nearly £20Bn with industry, accounting for over 40% of all UK government procurement spend and representing the fifth biggest defence budget in the world.
The size and complexity of many of our projects means that we need to work closely with our most important suppliers to ensure delivery of the Defence programme. These are currently Boeing, BAe Systems, Rolls-Royce, Airbus, Lockheed Martin, Thales, QinetiQ, Leonardo, MBDA, Babcock, Serco, Capita, AWE and HP.
We advocate the use of competition wherever appropriate both in our direct contact opportunities and throughout the supply chain. Opportunities therefore exist for suppliers of all sizes, from large established defence contractors through to innovative smaller businesses, to get involved in our procurement activity both as a prime supplier and as a sub-contractor.
The programmes we support are detailed in the Defence Equipment Plan; the top three equipment programmes in terms of spend include Typhoon, Future Strategic tanker Aircraft and Astute Attack Submarine. In addition we spend over £3Bn annually on infrastructure and defence estates.
Why choose us
We believe that the variety of our procurement activity coupled with the size of our spend makes defence an attractive place to do business. However we recognise that the size of the department can be daunting for prospective suppliers, and especially smaller businesses working with us for the first time. To address this we have launched a number of initiatives to make life easier for our suppliers.
- We’re making it easier for smaller businesses to find opportunities and compete for contracts by introducing a new supplier portal. This approach is supported by our network of Supply Chain Advocates who are tasked with taking a proactive approach to attracting new suppliers to defence
- We’re committed to continuously developing our commercial expertise and seeking innovative solutions for our customers in the armed forces
- We’re making our procurement simpler and more transparent.
We advertise our requirements widely and use several channels to help suppliers access public sector contracts detailed below.
Our commercial policy priorities
We are committed to delivering the best value for money in our procurement activity, and we are seeking to improve this further by:
- Improving access to our market for new, innovative suppliers and particularly smaller businesses. We want at least 25% of our procurement spend to go to SMEs both directly and indirectly by 2020.
- Increasing visibility of our future contract opportunities through a published pipeline and advertising both direct and sub-contract opportunities in one place through enhancements to the Defence Contracts Online portal.
- Laying out clearly the behaviours we expect from our most important suppliers.
Spending more with SMEs
We recognise SMEs have a great deal to offer in promoting economic growth. We are working to help SMEs, including social enterprises and charities, gain a greater share of defence related business.
For more information, please see our refreshed SME policy, launched in March 2016.
You may wish to read this guide for small and medium-sized enterprises by Emma Jones, Small Business Crown Representative and the Crown Commercial Service. This contains useful guidance on what to expect when selling to Government and top tips on how to bid for and win Government contracts.
Please note: This guide is intended for Government-wide suppliers and therefore does not include the following Defence-specific points:
- The single online portal for Defence Contracts is Defence Contracts Online
- Pre-Qualification Questionnaires (PQQs) are still employed for Defence Contracts under the £100,000 threshold in certain circumstances.
How we procure
The European Union Procurement Regulations drive UK law for public sector procurements and alongside MOD procurement policy provide the overarching control framework for all procurements.
This means that, as a public sector organisation, we procure in a different way to industry eg competition as the default position, we set objective tender selection criteria, we are fair and transparent and will be held accountable for procurement decisions in a way the private sector is not. Our principles include non-discrimination (on grounds of nationality), equal treatment (of all suppliers), transparency (act in fair and non-discriminatory manner), mutual recognition (of equivalent documents and standards)
Our procurement activity is consistent with the CADMID (Concept, Assessment, Demonstration, Manufacture, In-Service, and Dispose) cycle.
Where to Find MOD Contract opportunities
We advertise our tender and contract opportunities widely. We use the government’s ’Contracts Finder’ portal; here central government departments and other public bodies advertise tender and contract opportunities valued at £10,000 and above. Access to Contracts Finder is free of charge the best way to access is through DCO.
We also advertise tender and contract opportunities valued over £10,000 in the Defence Contracts Online(DCO) portal. Access and registration to the MOD’s opportunities in the DCO portal is free of charge. We are also encouraging our key suppliers to advertise sub-contracting opportunities here, but suggest you also engage with Defence Contractors websites to seek sub-contracting opportunities.
Our contract opportunities which fall within the scope of EU Public Procurement Regulation thresholds are additionally advertised in the Official Journal of the European Union (OJEU).
Requirements below £10,000 are often one-off projects bought in accordance with our internal policy for low value purchasing.
Crown Commercial Services (CCS)
CCS is an executive agency of the Cabinet Office, and their role includes managing the procurement of common goods and services, so public sector organisations with similar needs achieve value by buying as a single customer. CCS works with over 17,000 customer organisations in the public sector and their services are provided by more than 5,000 suppliers.
CCS procures a number of framework agreements, which are a set of pre-tendered contracts with a range of suppliers from which public sector customers can purchase goods and services, and MOD makes use of a number of these.
Want to know more?
To find out about supplying defence and how we can help you please get in touch. The MOD’s Doing Business with Defence Team provides advice and guidance to companies interested in becoming suppliers to defence. The team can provide help on:
- becoming a defence supplier
- accessing MOD tender and contract opportunities online and free of charge
- explain procedures and processes we use to buy a wide variety of goods and services.
You can meet the team at various exhibitions, seminars and ‘meet the buyer’ events each year at locations across the UK.
Doing Business with Defence Outreach Team
Poplar 1, #2119
MOD Abbey Wood
Telephone: 0151 242 2000
Mystery Shopper Scheme:
The Crown Commercial Service’s Mystery Shopper Scheme provides a route for suppliers and potential suppliers, especially SMEs, to raise concerns about public procurement practice.