4. Managing your contract
How to review supplier performance, renew or end the contract, and review your procurement process.
Regularly review supplier performance
For ongoing contracts (particularly services contracts), it’s important to hold regular contract management meetings to:
- make sure both parties involved in the contract understand their responsibilities and fulfil them as effectively as possible
- check progress against contract requirements and deal with any issues preventing those requirements from happening
Agree as soon as possible after awarding the contract who should attend these meetings and what the agenda items are likely to be. The meetings should become less frequent once you feel confident that the supplier is performing satisfactorily and is on course to meet your requirements.
In the meetings you should discuss the following, where appropriate:
- progress against the contract’s requirements
- the service-level agreement (the standards of service you have agreed with your supplier) and any key performance indicators (how you measure the performance of that service):
- acknowledging where the supplier has performed satisfactorily
- identifying areas of concern as early as possible and what the supplier will do about them
- discussing necessary changes
- how to manage planned maintenance
- possible upgrades or improvements to the product or service
- unforeseen problems and what to do about them
You should note the actions and timescales that you agree with the supplier, and circulate those notes promptly after the meeting. If the supplier produces these notes, you should make sure that they include all the areas from the discussion and what the respective actions are.
If you think the supplier isn’t doing enough to address poor performance, you may need to escalate the matter according to your contract’s terms and conditions.
Vary the contract
If you need to make any changes to the contract, you should use a variation agreement. You may need to vary the contract if:
- your school or the supplier needs to change the contracting authority, name, address or named individual in the contract
- you wish to extend the contract for a period beyond the originally agreed end date
You should agree any variations with the supplier before making any changes.
A model variation agreement is available.
Renew the contract
You should start preparing for the next contract period well before the end of the existing contract. This way you can allow sufficient time for negotiating a contract extension or, if necessary, running a new procurement process, so that you can make sure a new contract is in place when the old one ends.
If you need to extend the contract beyond its end date, and if the existing contract is below the EU public procurement threshold, you can chose to extend it to a reasonable point in the future. Generally, the extension should be no longer than half the time of the original time agreed.
You should consider value for money and what performance you need from your supplier when agreeing the length of time to extend the contract.
If your existing contract is above the EU procurement threshold, you must undertake a new tender process and should not simply renew the existing contract. However, you can extend the contract as long as you have a plan for running the new procurement process in a reasonable timescale.
End the contract
You should start preparing for the end of the contract period well in advance. You may need to consider what you’ll need to do to:
- return suppliers’ equipment
- end any joint arrangements with suppliers
- remove or dispose of any unwanted items
If you need to end the contract early, you should follow the exit process according to the contract’s terms and conditions.
Review your procurement process
At the end of a contract, or when you’re planning to renew a contract, you should carry out a formal review, talking to stakeholders and, where appropriate, a sample of users of the product or service. You should discuss how the supplier performed and what you have learned during the life of the contract, such as:
- what went well
- what didn’t go well
- what you could do to improve the next procurement
Make sure that you update your procurement documentation so that anyone managing similar procurements in the future can take this into account.
Read the next chapter: ‘5. Useful resources’.