Procurement in construction: Knowledge hub

[edit] Summary

Procurement is the process of acquiring goods, services, or works from external sources to meet an organization's needs. It encompasses all activities from identifying a need to the final payment and supplier relationship management. It is more strategic and comprehensive than just purchasing, focusing on value, quality, and long-term benefits.

This knowledge hub brings together key guidance, definitions, legislation, case studies, and innovations related to procurement in construction. Whether you're an architect, engineer, project manager or student, this is your starting point for understanding and applying best practice in procurement.

[edit] What is procurement in construction?

There are many different routes by which the design and construction of a building can be procured. The selected route should follow a strategy which fits the long-term objectives of the client's business plan.

Considerations that might influence the selection of a procurement route are likely to include:

• Speed.
• Cost.
• Quality.
• Specific project constraints.
• Risk.
• Asset ownership.
• Financing.

The main procurement routes are:

• Traditional contract.
• Single-stage design and build.
• Two-stage design and build.
• Management contract.

[edit] Why does procurement matter in construction?

Procurement is crucial in construction because it ensures projects are completed efficiently, on time, within budget, and to the required quality standards by managing the acquisition of necessary materials and services. A well-defined procurement strategy helps mitigate risks, enhances collaboration, and ultimately contributes to overall project success. Procurement allocates responsibilities to the different parties involved in the planning, design, construction and operation of built assets. It also determines who is taking the risk for those aspects of the project. If procurement is not properly considered at the outset, it can be difficult to recover the situation later.

[edit] Key articles about procurement

Here are some of the most important and widely read articles on procurement available on Designing Buildings:

• Appointments. How to make appointments for the main roles on construction projects.
• Construction contract. Covers the elements, structure, and types of contracts used across procurement routes.
• Construction management. Focuses on client appointed trade contractors overseen by a construction manager.
• Design and build procurement route. How the client appoints a single contractor for both design and construction, with pros, cons, and process variations.
• Difference between procurement and tendering. Procurement covers the full purchasing cycle, while tendering is specifically the bidding stage.
• Framework contract. Explains how repetitive or call-off procurement is managed under a framework agreement.
• Lump sum contract. Discusses contracts with fixed price and stage payment structure common in well-defined projects.
• Management contract. Describes procurement where a management contractor coordinates specialist packages directly contracted to the client.
• Managing the procurement process. Provides a framework of stages from need assessment to post occupancy evaluation.
• Negotiation. The techniques that can be used where two or more parties have to reach a common, agreed position.
• Partnering in construction. A collaborative framework involving all stakeholders with shared project goals, dispute ladders, and performance measures to reduce conflict and improve outcomes.
• Pre-qualification questionnaire (PQQ). Used to screen and shortlist suppliers before tendering, ensuring they meet financial, technical and compliance criteria.
• Private finance initiative (PFI). A form of long-term public-private project financing where a private consortium builds, finances, and often maintains an asset over 25–30years under contract.
• Procurement policy. What is the governments approach to procurement?
• Procurement route. Explains the range of procurement routes (e.g. traditional, design and build, partnering) and factors for selecting the most suitable one.
• Procurement route – frequently asked questions. Answers common questions about procurement routes, definitions, selection, and stages.
• Procurement route options pros and cons. Compares various routes and their respective strengths/weaknesses.
• Public private partnerships (PPP) – Describes long-term collaborations between government and private sector to deliver policies, services, buildings, or infrastructure, spanning finance, design, construction, operation and maintenance.
• Public procurement. Outlines formal procedures, roles, gateway reviews and guidance for public sector purchasing.
• Selection criteria. Items against which a prospective supplier can be assessed before a selection is made and a contract awarded.
• Single stage tender. The traditional tender process used when full project information is available from the start, issuing an invitation to tender and selecting a contractor competitively.
• Subcontract procurement. The process by which a main contractor engages specialists for parts of the main contract.
• Tender process. Summarises the range of tender routes—open, selective, negotiated, serial, framework—and the key differences between single- and two-stage tendering.
• Traditional contract for construction. Details the standard form lump sum construction contract used in traditional procurement.
• Two stage tender. Covers the route where contractors are selected first, then price negotiated after design development.
• What is the most common procurement route? Shares data on usage trends of different procurement methods across project sizes and sectors.

[edit] All articles about procurement

There are more that 1,000 articles about procurement on Designing Buildings. A full index is available here.

[edit] Stay up-to-date

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This work is openly licensed via CC BY 4.0.