Procurement at MOD
Ministry of Defence purchasing arrangements and information for those looking to become a supplier or contractor.
The Ministry of Defence (MOD) is changing procurement processes to improve the way business of all sizes work with us.
we need to provide our armed forces and national security agencies with the best capabilities we can afford, to enable them to protect the UK’s security and to advance the UK’s interests, both now and in the long term, and in doing so, to obtain the best possible value for money for the tax payer.
White Paper ‘National Security Through Technology‘, February 2012, Executive Summary, extract thereof.
We advise that you read ‘How defence works’ to better understand:
- the way the defence operating model works
- the control framework (how we meet business aims)
- the role of stakeholders in procurement decisions
- how we buy equipment, logistic support and information services to deliver military capability
Who we are
The MOD is one of the biggest public procurement organisations in Europe, the single largest customer for UK industry. We have a diverse range of requirements, including everything from military fighting vehicles to facilities management. Our customers include our armed forces and national security agencies.
We want to encourage innovation in our business. We recognise that both current and potential suppliers have valuable experience across many industry sectors and can help us deliver our business in an increasingly efficient and effective way.
The areas we work in cover:
- technology: cloud and digital, network services, software and technology products and services
- vehicle platforms: the procurement and support of ships, submarines, aircraft, vehicles
- supporting services: weapons and general requirements including food, clothing, medical supplies and temporary accommodation
- buildings: facilities management, maintenance and repair, utilities and fuel
- people: permanent and temporary staff (including clinical staff), outsourced services (such as language and employee services) and advisory services
Why choose us
- we spend approximately £19 billion per annum with UK industry
- we’re making it easier for smaller businesses to win contracts
- we’re committed to continuously developing our commercial expertise and seeking innovative solutions for our customers
- we’re making public sector procurement simpler
We will use competition as our default position and look at the domestic and global defence and security market for products that are proven, that are reliable, and that meet our current needs. However, the principle is qualified by the need to take action to protect our technological advantage where essential for national security.
We advertise widely and use several channels to help suppliers access public sector contracts. Our network of supply chain advocates is helping us tackle reported cases of poor procurement practice and improve standards.
Our commercial policy priorities
These priorities include:
- a quarter of defence spend to go to small and medium-sized enterprises (SMEs) by 2020
- increasing the transparency of contract information
- implementing the prompt payment policy across the supply chain
Our procurement activity is consistent with the CADMID (Concept, Assessment, Demonstration, Manufacture, In-Service, and Dispose) cycle.
Innovative proposals and the Defence and Security Accelerator
The Defence and Security Accelerator focuses on innovations which can provide advantage to defence and national security to protect the UK from its adversaries. It funds the development of suppliers’ innovative ideas and provide support through to potential application. The Accelerator will also fund innovations for defence and security which support economic growth and prosperity in the UK.
The Accelerator holds regular themed competitions to address specific defence and security challenges, and promote the monthly ‘Accelerator Enduring Challenge’ to more broadly capture potential innovations that address the most important problems in defence.
The MOD is committed to encouraging innovation in our business. Innovation can take many forms, including:
- new application of existing technologies
- development of new technologies
- changes to working practices or procedures
Contracting, Purchasing and Finance (CP&F) tool
The MOD is currently developing a replacement system for its procurement tools. The CP&F system will provide a single end to end capability by providing significant change opportunities for the MOD and suppliers in terms of improved contract visibility. It will enable a more efficient, effective and reliable process as well as providing timely management information.
All existing paper processes will be replaced providing a significant step toward the government directive that all procurement action is to be electronically conducted by 2017.
Find out more about the new system and how it will be implemented here.
Contract opportunities portals
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.
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.
Through an optional subscription service on DCO, potential suppliers will have access to UK, European and global opportunities relating to:
- emergency services
- humanitarian aid
- counter terrorism
- homeland security
Information about these opportunities is provided by BiP Solutions Ltd, a publisher, who is entirely independent of MOD.
Our contract opportunities valued at, or above, the EU threshold, and which are not exempt from advertising, are advertised in the Official Journal of the European Union (OJEU) as well as in DCO and, for those preferring a magazine format, in the Defence Contracts Bulletin, available from BiP Solutions Ltd on subscription every 2 weeks.
Requirements below £10,000 are often one off projects bought in accordance with our internal policy for low value purchasing (known as Joint Service Publication 332). JSP 332 is intended as a guide, designed to be used by staff responsible for low value purchasing and the electronic purchasing card.
Spending more with SMEs
MOD is working to help SMEs, including social enterprises and charities, gain a greater share of defence related business.
Our goal is for 25% of central government spending to go to SMEs European Commission definition of ‘SME’ by 2020. This applies to the money which the MOD spends directly with SMEs, and with our ‘prime contractors’ who, in turn, spend with their sub-contractors.
We are changing how we do business to make sure that smaller businesses benefit from defence spending. Our refreshed SME policy, launched in March 2016, includes:
- a new Supply Chain Champion and a supply chain network to provide points of contact for suppliers
- a fresh assault on bureaucracy and poor procurement practices. For example, we’ve made it clear that procurement teams must not rule out SMEs who are financially sound simply because their turnover is low
- a new online tool for suppliers that highlights opportunities, explains our policy and advises how they can target funding streams
We spend approximately £4 billion (19%) a year with small firms. In the financial year 2015 to 2016, the MOD spent £762 million (or 4%) directly with nearly 5,000 different SMEs. These figures remain provisional. MOD is working with the Cabinet Office to evaluate the viability of identifying the SME status of companies not currently assessed by Dun & Bradstreet. Dun and Bradstreet are a leading provider of business information, whom classify all government suppliers as either SMEs or non-SMEs.
SME success stories
Read our case study of an SME’s partnership with MOD to deliver innovation in the MOD Maritime Programme
Read our case study of an SME’s partnership with MOD to integrate disparate cloud services and improve efficiency and ease of use
Want to know more?
To find out about supplying defence and how we can help you please get in touch. The MOD’s outreach service provides advice and guidance to companies interested in becoming suppliers to defence. The team will, on request, explain:
- how to become a defence supplier
- how to access MOD tender and contract opportunities online and free of charge
- explain procedures and processes that MOD uses to buy a wide variety of goods and services
You can meet the outreach team at around 50 exhibitions, seminars and ‘meet the buyer’ events each year at various locations across the UK where they will deliver ‘Doing business with the MOD’ presentations, where appropriate.
Strategic Supplier Management team
Poplar 1 #2119
Telephone: 0151 242 2000
European Defence Procurement
The MOD is a member of the European Defence Agency (EDA), an intergovernmental Agency of the European Council.
supports the member states and the council in their effort to improve European defence capabilities…
The EDAs and MOD understand that the future success of the European defence industry depends on innovation, and the effective use of the workforce’s knowledge and skills. Work is ongoing and focused on:
- access to markets
- information and funding
- defence research and technology
- ‘cluster building’
- business innovation
The EDA’s guidelines provide recommendations to member states for promoting innovation and competitiveness. They also recommend defence related SMEs in ways of improving access to:
- defence procurement
- supply chains
The EDA’ Defence Procurement Gateway provides defence related business opportunities and information at the EU and national level.
MOD supplier invoicing and payment information:
- Defence Business Services (DBS) payment performance, invoice processing and MOD contract payments information
How to sell defence related goods and services overseas:
The Department of Trade’s Defence & Security Organisation’s (DIT DSO) Small Business Unit provides dedicated support for UK SME companies that are looking to win defence and security business overseas.
You can telephone DTI DSO Small Business Unit on 020 7215 8204
The Defence Growth Partnership:
The Defence Growth Partnership is a unique collaboration between UK government and leading companies from the UK defence industry. It has been formed to meet the challenges of increased international competition for defence business, and has created a collaborative environment to enable the UK to offer the very best solutions to defence customers, tailored to meet global customer needs, including the MOD.