We know from experience that many people faced with a property systems procurement – whether you are a specifier, a property manager, a buyer or in another role – would like support and guidance to make the most informed decisions possible. In public procurement, this includes considering different forms of procurement and procedures.
Here we clarify the concepts and give you insights into the pros and cons of different procurement forms and procedures related to the procurement of building systems. This can help you decide which approach is best for your organisation.
Different forms of procurement – a summary of different terms and conditions
| Form of procurement | Best suited | Advantages | Disadvantages |
| Direct award Simpler procurement, threshold value according to LOU (often around SEK 700,000). Does not require advertising, can be carried out quickly with direct negotiations. | Small purchases of systems or additional services Test projects or pilot installations Urgent needs, or limited market supply | Easy to choose supplier Fast with direct negotiation Can test smaller scoops before bigger decisions Less administration | Risk of lack of competition if the market is not properly mapped Risk of missing the best solution if the needs are analysed too quickly The threshold may limit the possibility of meeting all needs |
| Traditional procurement via LOU Formal, structured, competitive process in which tenders are requested and evaluated according to set criteria. Requires more time and resources. | When the need requires a comprehensive, long-term solution For larger, complex systems with high investment When transparency and competition are important for best price and quality | Ensures best price/best quality Possibility to set detailed functional and performance requirements – No monetary limits Clear legal process | Long, administratively burdensome process – Risk of ‘rigid’ procurement, limited room for more innovative solutions Often requires expertise and resources for requirements and evaluation Can lead to the cheapest option winning even though it is not best for the organisation |
| Call-off framework agreements – Licence supply agreements Call-offs from framework agreements with already procured terms simplify the process and reduce administration. Can be used, for example, to purchase licences without conducting a new procurement. | When there is a framework agreement covering the need Faster, simpler procurement of standardised systems When the focus is on a cost-effective, smooth purchasing process | Ease of administration – Cost effective Fast process with usually already quality assured systems to choose from Access to support, advice | Limited selection May in some cases be perceived as less flexible, due to predefined requirements Limited selection from outside to what is already centrally procured |
Different procedures – when is which way best suited?
In addition to different forms of procurement, the choice of negotiation and evaluation procedures affects how well you will be able to ensure that the procurement leads to the desired results. Here are three alternative approaches:
Open procedure – when requirements are clear and solutions are standardised, with several suppliers offering equivalent solutions where price and quality can be easily compared. Fast, transparent process, but without the possibility to negotiate.
Negotiated procedure – when requirements may need to be customised and a standard solution is not sufficient. Greater flexibility, better possibility to customise the solution and to discuss different aspects of the tenders with the suppliers, to best meet the needs. Requires more expertise, time and resources than an open procedure.
Competitive dialogue – suitable for complex procurements where the organisation needs guidance on possible solutions, or where precise requirements are difficult to define at the outset. Allows for customised solutions and innovation that you yourself may not yet have identified. A flexible, but often long and labour-intensive process.
The type of procurement and the procedure best suited to your organisation will depend on a number of factors, but there are some clear guidelines.
Direct procurement can be considered when you have a clear purpose and a long-term plan.
If there is a possibility to use a competitive dialogue or a negotiated procedure, a traditional procurement can be a good choice.
Call-offs against a framework agreement or licence supply agreement require that you have analysed the centrally procured solutions, see a good match with your needs and want to achieve a fast purchasing process.
In order to facilitate the procurement of building management systems, it can be useful to find out what is best practice in the work of mapping, requirements definition and evaluation. You can read more about this here
Our guide ‘How to ensure a quality procurement of building systems – best practice for public procurement’ provides more advice and guidance for your next procurement.
At Pythagoras, we have extensive experience in helping municipalities ensure efficient and coordinated property management. Our property system is based on insights and experiences from municipalities across the country. Please contact us if you would like to know more about the Pythagoras property system for municipalities.
