OUTSOURCING
A health check for contractors
Constructionline is a free procurement tool owned by the Department for Business Innovation and Skills. It is used by over 170 health organisations when tendering for regular maintenance and refurbishment work and last year it was used as the pre-qualification questionnaire (PQQ) for Procure 21+. Philip Prince describes how estates managers can make the most out of using it
- Assess the skills and qualifications of its staff as well as the area of its operations
- See that a contractor has adequate insurances
Philip Prince W
hile there’s never a guaranteed protection from a
procurement headache, getting things right at stage one is clearly the best start. It’s at the first stage of a procurement contest that some often-crucial indications about contractors’ weaknesses can be identified.
A robust PQQ can do a lot to filter out the good from the bad. When registering with Constructionline, a contractor has to demonstrate their suitability for work based on their technical, commercial and financial capabilities. It can also provide a method of short listing parties for work to meet a required minimum standard. Our PQQ allows health estates manager and directors to accomplish several things:
- Ensure that potential contractors are financially sound
- View a contractor’s certificates and licences as well as references from previous clients – including sharing feedback with other Constructionline buyers
Sep/Oct 10
- Check that they are up to date with legislation from health and safety to environmental and equalities in an ever changing legal landscape
- Find our other information about a contractor such as what quality standards it has obtained or whether it is a member of a trade federation or professional body.
Done badly, PQQs can simply become an additional headache for clients and suppliers. An estimated three per cent of total project cost is spent on the tender process, so the need to find an efficient PQQ system is important.
Also, web based systems like Constructionline negate the need to create, issue, read and process PQQ forms. A client just has to request a contractor’s registration number and then run it through the database to view their PQQ record.
Our new system even allows users the ability to run searches for contractors matching specific criteria and then create a tender shortlist from there.
But it is worth remembering that a PQQ is only ever a first stage assessment so it’s not appropriate for all the detailed project specific requirements.
Going for broke
It has been estimated that up to 17 construction firms have being going bust every day due to the continuing recession.
And this highlights perhaps the biggest nightmare for a health organisation – a contractor folding in the middle of urgently needed refurbishment work.
Our modern PQQ system offers sophisticated, real-time monitoring tools that can notify a client as soon as a supplier’s circumstances change.
As part of our £1 million re-launch, we updated and augmented our own systems by teaming up with business information firm Experian to provide our buyers with an early warning sign when a contractor’s credit rating declines at rapid or critical levels.
This provides buyers with increased visibility of their supply chains.
Our team of accountants monitor a supplier’s accounts at the time of their financial year- end submission to Companies House rather than at the firm’s annual renewal date.
The new agreement with Experian provides us with instant alerts and prompts the accounts team to conduct an immediate investigation of a supplier’s finances.
FOR MORE INFORMATION W:
www.constructionline.co.uk
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Careful financial investigation of a contractor’s circumstances also allows us to assess what they are capable of doing, making sure only those with adequate resources are identified on tender lists.
Mind your PQQs
The ongoing monitoring of PQQ information can provide a health organisation with an important check of their supply chain – one of the greatest assurances that best value can be achieved. Yes, procurement is challenging, and always has been, even without the difficulties caused by the recession.
While there is never a cast iron guarantee against
relationships turning sour, there is also no substitute for a sound procurement stage which begins with a well thought out PQQ process.
Constructionline is endorsed by the Office of Government Commerce
Philip Prince is a director from Constructionline
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