The Council aims to collaborate with a supplier to create a mutually beneficial supply chain to purchase IT Hardware to meet both our operational requirements and those within NYES. Whilst the products required are ultimately the same, the level of service and understanding of how a corporate team and education establishment works are slightly different. Therefore, the client teams have the expectation that two contract managers will be used by the supplier or one manager with experience within both areas.

Background:

The Corporate ICT provide the Council with:

· Hardware

· Software

· Infrastructure consumables

· Consultation and Framework Agreements

· ICT support though the Technology Support to corporate networked users.

The service area undertake a quarterly review of our technical roadmap to foresees the products required to be updated and purchased upon each year. Due to the nature of these products ad hoc purchases are also required due to unexpected faults and projects. Price checks occur quarterly and prior to contract management meetings to keep abreast of the lastest prices and best value for money. The service area do have some space available to store products, particularly those which are smaller. However, this contract would also benefit from a supplier who stores a level of larger products.

NYES Digital (previously referred to as Schools ICT) currently support over 400 educational establishments within North Yorkshire with all areas of ICT. Including although not limiting:

· Hardware

· Software

· Installation Services

· Broadband

· Support Services

· Web Services

· Framework Agreements (including support to procure).

NYES resell the products purchased via this contract to schools with a 6% increase (with the exception of certain Apple branded products which currently sit on approximately a 2-3% increase) in order to support the income generation within their team. In order to do this they offer additional services such as support with choosing products and assistance where required to the schools. NYES require school time only deliveries and a supplier who understands these requirements and additional support potentially needed by the education sector. Therefore, further focus to this will be applied within the specification.

The aim of this procurement is to compliantly support the income generation of NYES Digital whilst meeting the requirements of the Service Area. From the lessons learnt from the previous contract, further focus needs to be placed on the contract management and the requirement of a contract manager from NYES Digital. Whilst the service area will look further into the possibilities of storage solutions and their measurement of savings.

3. MARKET ENGAGEMENT / DISCOVERY STAGE

A review was completed by the Service Area on how they evaluate savings and to consider the options available to develop their specification of requirements. To further this and to understand the availability of the market to meet the needs of NYES an RFI was sent to suppliers on the CCS and NHS SBS Frameworks.

9 Suppliers responded to our RFI, 5 of which confirmed they had experience within the education market and could provide a dedicated contract manager for this area of the contract. Suppliers were also asked about how they determine value within their business and how they seek good value themselves in a market which fluctuates so frequently. Suppliers described several different methods of how they seek value and the issues they commonly encounter. Several different methods of achieving value and mitigating the unforeseen circumstances this market often faces included:

· Open book business models.

· Purchasing in dollars.

· Multiple sources of supply.

· Seeking value in the quality of product/service as opposed to primarily on price.

· Advanced notification of product changes.

· Volume Commitments.

· Holding privately owned stock.

· Managing Tier One (Dell, HP, Lenovo etc.) suppliers on a monthly basis for updates on supply chain issues.

· Market Accreditations

The suppliers’ responses, whilst can’t be directly actioned by us as an Authority. It was helpful to understand, as it is clear price fixing and attempting to commit suppliers to a specific % uplift on channel pricing is going to likely to achieve the same outcome and price increase as the previous contract saw. Instead the focus will be shaped to quality of service potentially included storage access, packaging reduction, notification on specification changes, transport reduction and rebates.

Strengths

1. Compliant route to market

2. Various suppliers have the ability to deliver this therefore, competition is increased.

Weaknesses

1. Prices are likely to continue to fluctuate from several factors.

Opportunities

1. Refresh how our hardware products are valued.

2. Re-write and reconsider the relationship we seek with a supplier.

3. Strive to accurately compare and monitor pricing.

4. Increase income opportunities.

Threats

1. The chosen framework has an expiry of December, contract needs to be signed prior to this.

4. OPTIONS CONSIDERED – IN HOUSE OR PROCUREMENT

IN HOUSE OPTION

4.1. Has consideration been given for this provision to be delivered in house? ☐Yes ☒ No

The Authority is currently unable to meet these requirements.

NEW PROCUREMENT

4.2. Are you establishing an approved provider list, contract, dynamic purchasing system or framework?

Form of Agreement	Yes	No
Approved Provider List (APL)	☐	☐
Contract	☒	☐
Dynamic Purchasing System (DPS)	☐	☐
Framework Agreement	☐	☐

4.3. What procurement procedures have you considered to establish the above?

Potential Procurement Procedure	Yes	No
Call Off (DPS or Framework Agreement)	☒	☐
Competitive Dialogue	☐	☐
Competitive Procedure with Negotiation	☐	☐
Dynamic Purchasing System (DPS)	☐	☐
Innovation Partnership	☐	☐
Light Touch Regime	☐	☐
Negotiation Procedure without Prior Publication	☐	☐
Open Procedure	☒	☐
Restricted Procedure	☐	☐
Other: Please state details such as direct award under Public Contracts Regulation 2015 as amended or Section 75 Agreement.	☐	☐

4.4. Summary of potential procurement procedures

The opportunity to tender Open has been explored however, has been dismissed due to several compliant framework agreements being readily available and short time availability to complete this procurement.

We narrowed down our framework options to NHS SBS: SBS10044 and the CCS: RM6068 as all suppliers are available to deliver all products required within this contract. Both also have framework managers who confirmed experience in our requirements. Both framework agreements currently have short timescales available to complete a call off which is a risk. This contract however, does need to be in place in the next few months, the services areas have been made aware of the consequences of not having this procurement completed in a timely manner and have committed to doing so.

CCS was chosen as our best route forward on this occasion as allows us to procure for the contract period required. CCS also have a technology products catalogue which they update on a daily basis and has details of benchmarking pricing. This can help us ensure we receive best value from this framework and support our contract management with the supplier.

Whilst this won’t be useful to this procurement now, it is worth mentioning that CCS RM6098 TePAS 2 is due to be published October 2023. CCS have edited the lots within the upcoming framework which means they will have available a lot specifically for Local Authorities and the education sector. This would be worth considering when this contract is due to expire.

4.5. Will the tender be divided into lots? ^▲Reg. 84 ☐Yes ☒ No

It was reviewed if this contract would be better placed to sit as one. It was decided that by lotting the contract could potentially hamper the savings expectations we currently have. The concept of the ‘partnership’ model we would like with the supplier sits primarily on our ability to aggregate spend with one supplier and through this receive large discounts on products.

Whilst areas within the specification will differ between the service area and NYES, materially the requirement is the same. The differences in the requirements such as contract management expectations and delivery methods don’t provide substantial benefit to be spilt and will require additional resource to procure and then contract manage.

4.6. If the recommendation is a call-off from a Framework, DPS or APL the please confirm the following:

a) Has the Contract Notice been checked to ensure that the Authority has been named and can access the agreement?

☒Yes ☐ No

b) Has the term of the framework / DPS / APL been checked to determine if there are any restrictions on the length of a call-off and is there sufficient time on the framework / DPS / APL to award a call-off

☒Yes ☐ No

The framework restricts customers to a contractual term of five years, which suites our requirement.

The framework expires on 9^th December 2023, whilst this is noted as being imminent. This contract is required by September so does meet our timescales, the service areas have both been made aware of the timescales required to make this possible and have committed their resource availability.

c) Is the scope and specification of the framework / APL / DPS suitable for the Authorities requirements?

☒Yes ☐ No

d) If the frameworks / APL / DPS is divided into lots you must identify which lot(s) are appropriate for the scope of the requirements.

Lot 2 - Hardware and Associated Services. – The lot overview reads:

‘This Lot 2 is for the provision of hardware requirements, including but not limited to; end user devices, infrastructure hardware, consumables and peripheral equipment with Associated Services.

This Lot may be utilised for the provision of small, medium or large volume hardware requirements and Suppliers will participate in aggregated procurement opportunities (where relevant to their product portfolio), typically these will be for high volume/value requirements.’

e) Has the anticipated value in the Contract Notice for the framework / APL / DPS been checked to ensure there is sufficient value remaining for the estimated call-off value?

☒Yes ☐ No

f) Have the terms of the framework / APL / DPS been checked for suitability against the Authority’s requirements (e.g. termination rights and liability limit)?

If the contract is worth over £1M or is high risk (for example because it is potentially politically sensitive or relates to the provision of vital services or goods) seek advice from legal on the suitability of the terms.

☐Yes ☒ No

g) Confirm the available award mechanisms available on the framework / APL / DPS and highlight if there are any restrictions placed on call-offs for the proposed award mechanism (e.g. mandated weightings).

There is no direct award option via this framework, customers have the option to complete either a further competition or a simplified price only competition. The mandated weightings are quality to be up to 90% and price between 10-100%.

5. RISKS / ISSUES OF RECOMMENDED PROCUREMENT OPTION

5.1. What are the risks / issues of the recommended option?

Ref.	Risk	Mitigation	Level
1	Price Fluctuations	A clear focus should be provided by the Authority and the supplier using KPIs and MI to develop a ‘partner’ style relationship. This contract should benefit both suppliers and the Authority therefore consistent meetings with clear agendas need to be adhered to.	H
2	Inconsistent/Poor Delivery Quality	Within the RFI suppliers will be requested to outline their availability to delivery to various location and their general timescales. This will support the development of the specification and the MI which will in turn ensure the Authorities requirements are adhered to.	M
3.	Loss Of Income for NYES.	The pricing evaluation should include all core items. Rebates, price fixing, and indexation should all also be considered in regard to how this may affect future pricing within the contract.	M
4	Inability to meet the delivery requirements.	The RFI collated information on if the timescales and locations requirements. Suppliers confirmed they can meet these requirements and therefore, they should be correctly detailed within the specification and then managed alongside the supplier.	L
5	Lack of storage for stock.	LGR has brought additional volume requirements to this contract. Previously smaller hardware items were stored in County Hall. Potentially there will be the ability to use local hubs as small storage facilities. For a longer term option, this procurement will have the additional requirement of bonded stock storage facilities to support this additional requirement. All suppliers within the RFI offered this service to us, the costs varied from free for a set period up to £100 per pallet per 6-month period. It was noted that for the cheapest rates roadmaps are required to be shared in advance with suppliers.	H

5.2. LGR (Local Government Reorganisation) IMPACT

The merging of the Councils means the volume of products required via this contract will increase. The aggregated spend this creates is likely to provide some savings on an individual product basis although understandably the overall spend of this contract will increase.

There is also the consideration of where to store all the additional products, which is highlighted in the risks above. The specification will include additional detail on how product roadmaps will be shared and the expectation to store stock. Pricing for this will also be included within the evaluation.

6. FINANCIAL CONSIDERATIONS OF RECOMMENDED PROCUREMENT OPTION

6.1. Detail the following:

Current Annual Budget:	NYES – Do not have a budget for this service. These products are purchased solely with the intention of reselling for income. Service Area - £489,500 with an additional refresh budget of £1,000,000
Current Annual Cost/ Contract Cost ^▲Reg. 84:	NYES: £860,000 Service Area - £1,500,000
Estimated Future Annual Cost:	NYES: £960,000 Service Area - £1,739,500 Total: £2,699,500* Products are demand led and may fluctuate.
Estimated Whole Life Cost:	£13,497,500
Forecast Saving:	NYES: £0. Service Area: A comparative saving is unlikely to be seen due to the service area’s scale of purchasing increasing. Please see 6.3 and 6.4 for details on savings.
Budget / Cost Centre:	RL - 100-21146-4031 (Service Area) 14141 (NYES)
Budget Manager:	Keren Wild & Caitlin Bell
Budget Allocated:	NYES - £0 Service Area - 1,739,500
Budget Manager Approval:	Yes

6.2. What considerations / impacts have been given to price fluctuations throughout the term of the contract (e.g. uplifts via indexation, inflation within the market, limitations on supply, etc.) and how will these be mitigated?

- Materials Shortages

- Current increase approx 15%

- Unknown/unwilling to share channel prices

Currently inflation in the market sits at approximately 15%, current limitations of certain manufacturing materials (mainly silicone and particulars metals) and unrest surrounding cyber security linked to Chinese manufactured microchips has created an increasingly challenging and frustrated market.

Rebates were considered to mitigate against the high cost associated with this contract. However, due to concerns around high pricing in this market generally there is the concern that by introducing a rebate, there is potential to increase these costs further without significant financial benefit to our client teams. Similarly, alongside this a % cap above CPI was considered to avoid substantial price hikes. This was unfavoured by the market, several of which felt would be reason enough not to tender, alongside this the client team felt it would be difficult from their perspective to contract manage. In particular NYES felt this could work against their ambition for income by potentially meaning schools can purchase products at the same rate as themselves.

The previous contract attempted to fix prices by no higher than +3% of channel pricing. Over the term of the contract this has unfortunately proved unhelpful due to channel pricing not being something our teams have visibility over. Therefore, this action hasn’t been measurable, and contract managed correctly. Going forward this tactic will not be used again, instead this procurement will request suppliers commit to a three-month price fix. Following this period, the supplier should demonstrate value by committing to prices equivalent or no higher than 3% for like for like quotes of core items compared with their current CCS framework prices.

These figures can then be measured by the service area during bench marking exercises and discussed at contract management meeting when needed.

6.3. Have any savings opportunities been considered? ☒Yes ☐ No

Cashable savings have been reviewed by both service areas and have proven difficult to quantify. NYES will see 0% savings due their income generation model, last year their income from contract was £51,600. In the upcoming years NYES has confirmed they will need to purchase all hardware for the new North Yorkshire Mayor and their team, alongside this in 2025 Microsoft 10 will become end of life and schools will need product refreshes throughout.

The Service Area have seen a minimum of 10% year on year price increases from the incumbent supplier. The Service Area are going to focus their efforts to create a list of core items focusing on lines which they currently feel they pay the most for and are often required. When the larger sized items (monitors, keyboards etc.) are required within technical roadmaps, these should be planned with the supplier. Then purchased in larger quantities ensuring to take advantage of the bonded stock option with suppliers. By engaging with the supplier earlier and allowing them visibility of our technical roadmaps this takes full advantage of the partnership ambitions of this contract and allows suppliers to purchase lines competitively themselves.

6.4. How do you intend to deliver value for money using your recommended procurement procedure?

Currently RM6068 has 38 suppliers on the framework, several of which responded to our RFI. This works to our advantage by encouraging competition in a currently volatile market. From a resource perspective this also eases pressure on the services areas.

Within the specification contract management will be brought to the forefront. It is clear that near channel pricing is an unlikely outcome of this contract however, developing a relationship with a supplier and setting limits which can be contract managed should deliver the outcomes the client teams strive for.

Focused and measurable KPIs will be written for NYES to ensure that the service elements that they require are delivered consistently. This will support the service they can offer to customers and ultimately ensure that the schools using these products have a positive experience and can then be encouraged to buy more.

The service area has been encouraged to provide further information within the tender and specifically the award criteria in order to use the suppliers services to their full potential. Additional focus on the service area and their requirements within the tender such as their current:

· Need for storage

· Mitigating stock shortages

· Planned refreshes

· Deliveries around the County

Will be used to drive value to their service and ultimately develop a relationship with the supplier.

7. DECISIONS AND CONSENTS REQUIRED

7.1. Is this procurement subject to a Key Decision? ☒Yes ☐ No

A key decision will take place on the 25^th July 2023.

7.2. Are any additional decisions / consents required (e.g. planning consents) in order for the procurement to proceed?

☐Yes ☒ No

N/A

8. SOCIAL VALUE

8.1. In this procurement, which of the Council Ambitions will Social Value make a contribution to?

Council Ambition:	Yes	No
Leading for North Yorkshire	☐	☒
Every child and young person has the best possible start in life	☐	☒
Every adult has a longer, healthier and independent life	☐	☒
North Yorkshire is a place with a strong economy and commitment to sustainable growth	☒	☐

8.2. Describe how Social Value has been and/or will be incorporated into this procurement?

This procurement will support the NYC Beyond Carbon plan by evaluating suppliers on their commitment to ensuring their supply chain is currently minimising its impact on the environment. Three specific areas of interest are sought via the products purchased through this contract:

- Seeking and maintaining relationships with manufactures using ocean plastics and actively promoting their use.

- Seeking and maintaining relationships with manufactures using recyclable metals and actively recycling suitable product parts where possible.

- Reduction of products to landfill through alternative use or recycling of end of life products.

9. OTHER CONSIDERATIONS

9.1. Has the service area been prompted to consider, and complete where appropriate, the following?

	Yes	No
GDPR screening questions (and subsequent DPIA if required) in conjunction with Data Governance team.	☐	☒
IR35 assessment in conjunction HR Resourcing Solutions team.	☐	☒
Equality Impact Assessment	☐	☒
Discussion with Property Services if the supplier will be required to deliver the service within the Authority’s premises.	☐	☒

9.2. If ‘no’ has been answered to any of the above, a justification should be outlined below.

This procurement involves the purchase of IT Hardware only and therefore the above points are not relevant.

10. PROJECT PLAN

10.1. Project Plan / Key Project Milestones

The timetable below is understandably pressured however, work is currently away with the tender documentation and both teams have agreed to commit their time to this project.

· Publication of tender documentation – 27^th July 2023

· Deadline for submissions – 18^th August 2023

· Consensus Evaluation – 30^th August 2023

· Gateway 3 – 14^th September 2023.

· Award Date – 19^th September 2023.

11. CONTRACT MANAGEMENT FOR THE RECOMMENDED OPTION

11.1. On-going contract management approach

Following the initial implementation period the contract with be reviewed quarterly by the named contract managers. KPIs will be laid out within the procurement documents and should be reviewed at every contract management meeting, failure to meet any of the KPI’s detailed within will result in higher frequency contract management meetings and potentially the supplier being put on a SMART Plan.

Please see an updated contract management plan below.

11.2. Proposed contract manager

Nic Watters and Paul Lofthouse will manage the contract. Nic will focus on NYES and their part within the contract whilst Paul’s focus will be on the service area and ensuring value for the Authority. Both Paul and Nic have experience with the previous contract and have completed the contract management training. Both Paul and Nic will meet the awarded supplier quarterly following the initial implementation period to discuss the relationship made by this contract and to share details of their planned up coming purchases.

Keren Wild and Caitlin Bell will support Nic and Paul with the contract management of this contract. Both Keren and Caitlin have contract management experience and are experienced with working alongside suppliers within the technology market.

12. GATE 1 AUTHORISATION

If the relevant sign off is given by an email, this should be referenced. For example, the signed box should state “authorised by (name)”. The date box would be the date of that email.

Procurement Assurance Board	Signed	Date

Comments:

Corporate Director (or delegated Assistant Director)	Signed	Date

Comments:

Finance (Corporate Director – Strategic Resources or delegated Assistant Director)	Signed	Date

Comments:

Assistant Chief Executive (Legal & Democratic Services)	Signed	Date

Comments:

Master Category:	Professional
Contract tier:	Gold
Directorate:	Central Services
Service Area:	Technology and Change
Report Author(s):	Kate Chapman
Assistant Director (AD):	Madi Hoskin
Legal Advisor	TBC
Contract Period:	01/09/23 – 31/08/25 First Extension: 01/09/25 – 31/08/27 Second Extension: 01/09/27 – 31/08/28
Estimated Whole Life Costs (Excluding VAT):	£13,497,500* *The spend for both these areas is need led and therefore, will fluctuate due to service requirements.
Estimated Whole Life Costs (Including VAT):	£16,197,000* *The spend for both these areas is need led and therefore, will fluctuate due to service requirements.
VAT rate:	20.00%
Key Decision Required:	Yes
The authority to complete the Contract comprises:	The authority to complete the Contract comprises 3.3. of the Officers Delegation Scheme
Brief Summary of Project: The Council requires IT hardware to meet the needs of our internal requirements and NYES Digital. The Council’s ambition is to create a mutually beneficial supply chain where our large volume of purchases meets competitive pricing. Alongside this the Council requires one supplier who is willing to work collaboratively and provide consistent contract management support to both teams.
Current Supplier:	Insight

GATE 1 - OPTIONS APPRAISAL / PROJECT INITIATION

1. RECOMMENDATION

2. PROCUREMENT BACKGROUND

3. MARKET ENGAGEMENT / DISCOVERY STAGE

4. OPTIONS CONSIDERED – IN HOUSE OR PROCUREMENT

5. RISKS / ISSUES OF RECOMMENDED PROCUREMENT OPTION

6. FINANCIAL CONSIDERATIONS OF RECOMMENDED PROCUREMENT OPTION

7. DECISIONS AND CONSENTS REQUIRED

8. SOCIAL VALUE

9. OTHER CONSIDERATIONS

10. PROJECT PLAN

11. CONTRACT MANAGEMENT FOR THE RECOMMENDED OPTION

12. GATE 1 AUTHORISATION

GATE 2 - SENIOR CATEGORY MANAGER & CATEGORY PROCUREMENT OFFICER AUTHORISATION OF DOCUMENTS

1. APPROVAL OF DOCUMENTATION

2. SUPPLY CHAIN VISIBILITY

3. GATE 2 AUTHORISATION