How to Award Contracts Using Call-Off Framework Agreements

In public procurement, framework agreements are a widely used method to purchase goods and services over a set period of time. They offer flexibility, efficiency, and cost-effectiveness. 

Among these, call-off framework agreements are particularly valuable for both public sector buyers and suppliers. 

Understanding how to award a contract based on a call-off framework agreement will help you streamline procurement, ensuring transparency, compliance, and long-term success.

In this article you’ll learn what call-off framework agreements are, how they work, and how they benefit both public sector buyers and suppliers. We’ll also discuss how technology can support this process, making it more efficient and compliant with procurement regulations.

What is a Call-Off Framework Agreement?

A call-off framework agreement is a long-term agreement between a buyer (typically a public sector organization) and one or more suppliers, allowing the buyer to place orders (or “call-offs”) over a set period. 

Unlike traditional procurement where each purchase requires a separate tendering process, a call-off agreement enables the buyer to place orders quickly under predefined terms, conditions, and pricing.

Key characteristics of call-off agreements include:

• Flexibility and Convenience: You can place orders at any time during the agreement period without the need for a new tender each time.
  
  

• Predefined Terms: Pricing, delivery, and specifications are agreed upon upfront, making future orders faster and more efficient.
  
  

• Multiple Suppliers: Framework agreements can include several suppliers, allowing you to select the most suitable option based on availability and performance.

How Do Call-Off Framework Agreements Work?

The process of awarding a contract based on a call-off framework agreement typically follows these steps:

1. Establishing the Framework Agreement

The first step involves setting up the framework agreement through a competitive bidding process. Once awarded, this framework defines the terms, pricing, and conditions for future orders (call-offs). This step involves publishing a tender and selecting suppliers based on criteria like price, quality, and compliance.

2. Issuing Call-Off Orders

Once the framework is in place, you can place call-off orders whenever needed. Depending on the agreement, you may be able to select a supplier based on the specific requirements of the call-off, or you may run a mini-competition among the suppliers in the framework.

3. Transparency in Selection

When multiple suppliers are included in the framework, it's important for you to follow a transparent process in selecting which supplier to use for each call-off. You might choose based on factors like supplier availability, delivery times, or previous performance. Sometimes, a mini-competition may be required to ensure the best fit.

4. Managing the Call-Off Process

Once the call-off is placed, both you and the supplier are expected to follow the agreed-upon terms. You should monitor performance, delivery timelines, and compliance to ensure that the call-off is completed successfully. Regular communication will help address any issues that arise during the process.

Benefits of Call-Off Framework Agreements for Public Sector Buyers

1. Efficiency: One of the major benefits of call-off agreements is that they eliminate the need for repetitive tendering. Once the framework is in place, you can quickly place orders without having to initiate a full procurement process each time, saving you time and reducing administrative effort.
   
   

2. Cost Savings: Framework agreements typically offer competitive pricing that can lead to cost savings over time. With pre-negotiated prices and terms, you can avoid the additional costs associated with frequent tenders and negotiations.
   
   

3. Flexibility and Speed: Call-offs give you flexibility in placing orders as needed, without the delays associated with traditional procurement processes. This is especially useful when you have urgent or changing requirements.
   
   

4. Better Supplier Relationships: Framework agreements foster long-term relationships with suppliers, allowing you to benefit from consistent service and better pricing over time. These relationships lead to improved communication, better performance, and reduced risk.

Benefits of Call-Off Framework Agreements for Suppliers

1. Predictable Revenue Stream

For suppliers, call-off agreements provide a predictable revenue stream as they receive ongoing orders throughout the duration of the agreement. This stability is beneficial for long-term planning and growth.

2. Simplified Ordering Process

Suppliers benefit from a streamlined order process. When a call-off is issued, there’s no need to renegotiate terms, making the process faster and more efficient for both sides.

3. Long-Term Business Opportunities

Being part of a framework agreement allows suppliers to secure ongoing business with public buyers. The repeated orders from call-offs offer more opportunities for growth and collaboration.

How Technology Supports Call-Off Framework Agreements

To effectively manage call-off framework agreements, technology plays a critical role in ensuring efficiency, transparency, and compliance. By using a digital procurement platform like Mercell, you can manage call-off agreements and track the process with ease.

1. Centralized Management: Technology centralizes the management of framework agreements and call-offs. With Mercell, you can track all ongoing agreements, monitor call-off orders, and review performance - all from a single platform.
   
   

2. Real-Time Notifications: Both public buyers and suppliers benefit from real-time notifications. These keep everyone informed about call-offs, upcoming deadlines, and any updates, ensuring that the process runs smoothly without delays.
   
   

3. Compliance and Transparency: Technology ensures compliance by tracking all aspects of the procurement process, making it easy to stay aligned with regulatory requirements. Mercell provides transparency throughout, so both parties can monitor the progress of call-offs and ensure everything is done according to the terms of the agreement.
   
   

4. Data and Reporting: With built-in data analytics, technology helps you track key metrics and performance indicators. Whether you're monitoring supplier performance or reviewing past orders, you can use the insights to improve future procurement strategies.

Conclusion

Call-off framework agreements provide a flexible, efficient, and cost-effective way to meet procurement needs while ensuring compliance and transparency. 

They offer significant benefits to both public buyers and suppliers, including reduced administrative burdens, better pricing, and long-term business opportunities. 

By utilizing technology, such as Mercell, both buyers and suppliers can manage these agreements more effectively, ensuring that the procurement process remains streamlined, compliant, and transparent.

If you're ready to optimize your procurement process and efficiently manage your call-off framework agreements, sign up for a free trial with Mercell today and experience the power of digital procurement.