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Supplier panels​​

​How to create, manage and use a supplier panel.

Agencies can set up panels of suppliers who are pre-approved to provide goods or services – this can help streamline procurement processes. You can create a panel just for your own agency, or one that other agencies can use. For more information on setting up a panel, see Rule 40: Syndicated contracts.

How supplier panels work

Once a panel has been established through an open process, an agency must use the secondary procurement method/s specified in the Notice of Procurement and detailed in the Panel Guide to select a supplier. A competitive secondary procurement process must be used unless there is good reason not to. Secondary procurement process may include:

  • competitive quotes based on the supplier’s expertise, proposed solution and/ or best public value
  • direct sourcing, based on the best fit for purpose
  • rotation – awarding opportunities to each supplier in turn
  • equal division of the work
  • location – awarding the contract to whichever supplier is in a location best suited to supply the product or service.

For more information on different ways to source, see Options for approaching the market.

Running a secondary procurement process

Once you have decided what secondary procurement processes to use, and how you'll evaluate responses you can approach some or all of the suppliers on the panel.

  • Decide how many suppliers you will approach – you don't have to approach everyone on the panel unless you think it would be worthwhile.
  • You do not need to openly advertise your contract opportunity. You can contact the suppliers directly.
  • Make the process as streamlined as possible and proportionate to the value and risk of the contract.
  • Only ask for information you need to decide who is best able to deliver the contract. Basic supplier information should have been provided when the panel was established.
  • Evaluate responses, determine a winning bid and notify all respondents of the outcome. You should provide suppliers with a debrief if requested.
  • You must publish a contract award notice once the secondary procurement process has been completed, if the value is $100,000 or more.

Rule 22 outlines what you must do when setting up and running a supplier panel.

When to establish a panel

Before establishing a panel you must ensure you have the capacity and capability to manage the panel.

Panels are most useful when there is:

  • an ongoing need for the product or service
  • enough volume or value to support more than one supplier
  • a need or preference for more than one supplier to deliver the goods or services.

Do a thorough analysis of the market to work out whether there are enough suppliers to support a panel, and whether development of a panel would have positive or negative impacts on the market.

Analysing the market

Before establishing the panel you should also consider:

  • whether it will be open to new suppliers while it is running, or closed. If there are new suppliers entering the market, an open panel can be fairer to them and could improve outcomes for government.
  • contract length. Short-term contracts (eg one year) can be expensive and time consuming. Medium-term contracts support good relationships and a continuous improvement approach. Excessively long contracts can create supplier lock-in and reduce the competitiveness of the panel.

How to establish a panel

Rule 22 of the Government Procurement Rules defines the process for establishing a panel.

You must provide a panel guide that identifies appropriate method/s for allocating secondary contracts (Rule 22.8) based on the anticipated size, value, and risk of contracts likely to be awarded through the panel.

The guide must provide clear guidelines about the secondary procurement process and you must inform suppliers of the panel guide. 

You also need to ensure the Panel Guide is accessible for anyone purchasing from the panel at any time.

Managing your panel

Good panel management is crucial for a panel to function well. These practices are the same as good contract management practices. You must have a developed contract management plan for the panel and discuss it with suppliers, including with any new suppliers added to the panel during the contract's life.

Manage the contract

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