Futures Housing adopts groundbreaking SME-friendly procurement contract
A Midlands housing association has become the first organisation to adopt a pioneering procurement contract designed to make it easier for small business to access big contracts.
Futures Housing Group, which manages more than 9,000 homes in the East Midlands, has adopted new Framework Alliance Contract (FAC-1), which is intended to help small and medium sized enterprises (SMEs) grab a slice of significant public contracts.
Recent changes to procurement laws have removed barriers for SMEs and Futures has been one of the first to capitalise by adopting new frameworks and processes to make tendering for contracts more accessible.
The all-new FAC-1 Framework Alliance Contract, written by Professor David Mosey PhD, director of construction law and dispute resolution at Kings College London, provides a platform that is said to be easy to understand and helps improve legal compliance as well as value for money.
This new contract combined with the latest procurement rules has enabled SMEs to tender for parts of bigger overall frameworks with Futures, creating healthier competition in the marketplace and access to a richer resource pool for the organisation.
John Thornhill, head of procurement at Futures, said: “The first contract we’ve put out under these new rules, which was for planned maintenance works, has seen around 90 businesses bid for the contract – which is unprecedented.
“The changes to the law have put us in touch with smaller businesses that previously weren’t able to afford to work with us, for example due to cash flow constraints if they took up a works programme.
“Our new contract includes innovative ways of improving SME cash flow as well as making the bidding process and the use of Lots more attractive, allowing them to compete on a level playing-field against the larger companies.
“The new FAC-1 Framework Alliance Contract is exactly the right tool to ensure this happens. Its language is plain and the possibilities for collaboration across the supply chain are almost endless. We are very proud to be the first user.
“It’s a win-win situation as it means we have a better selection of contractors, which makes for greater competition in the marketplace and enables smaller firms to generate more income through big contracts and increase their cash flow.”
Professor Mosey was recently a keynote speaker at Futures annual supply chain conference which enables the organisation to meet with existing and potential suppliers. He said: “I am delighted that Futures are the first client to put FAC-1 into practice. They are creating a framework alliance of SME contractors with systems that will drive improved value, for example through shared suppliers and joint employment and training.”