Joint Procurement

Joint procurement is the practice of multiple contracting authorities combining their procurement activities under a single procurement procedure to achieve scale economies, share expertise, and reduce administrative duplication. Joint procurement can take many forms, from informal coordination on specific contracts to formal central purchasing bodies serving entire public sectors. The European Union procurement directives explicitly permit joint procurement and support it as a tool for efficient public spending.

Joint procurement is the practice of multiple contracting authorities combining their procurement activities under a single procurement procedure to achieve scale economies, share expertise, and reduce administrative duplication. Joint procurement can take many forms, from informal coordination on specific contracts to formal central purchasing bodies serving entire public sectors. The European Union procurement directives explicitly permit joint procurement and support it as a tool for efficient public spending.

Why contracting authorities undertake joint procurement

Several drivers motivate joint procurement. The most obvious is purchasing power: by combining demand across multiple buyers, joint procurement can secure better prices than individual buyers acting alone. Suppliers prefer larger contracts because they amortise fixed costs across more revenue, allowing them to offer lower per-unit prices. The aggregated demand also justifies investment by suppliers in better delivery infrastructure, training, and service capabilities.

Administrative efficiency is another driver. Procurement procedures involve substantial overhead in legal review, document preparation, evaluation, and contract management. When multiple buyers each procure similar goods or services separately, the administrative cost is multiplied across all of them. Joint procurement consolidates the administrative effort into a single procedure, freeing buyer resources for other priorities.

Joint procurement also concentrates expertise. Specialised procurement categories such as IT systems, complex healthcare equipment, or large infrastructure require deep technical knowledge to procure effectively. Individual buyers may lack the expertise to specify and evaluate these procurements competently. Joint procurement allows expert teams to serve multiple buyers, applying their specialised knowledge across the broader public sector.

Forms of joint procurement

Joint procurement takes many forms in practice. The simplest is occasional coordination, where two or more contracting authorities decide to combine specific upcoming procurements without creating any permanent structure. This works well for one-off opportunities where the joint partners have similar needs at the same time.

More formal arrangements include consortia, where multiple contracting authorities form a structured partnership for ongoing procurement coordination. Consortia typically have governance arrangements, shared procurement procedures, and defined cost-sharing mechanisms. They sit between fully independent buyers and fully centralised purchasing bodies, providing structure without complete consolidation.

Centralised purchasing bodies represent the most institutional form of joint procurement. These are dedicated organisations that procure on behalf of multiple downstream buyers, often across an entire national public sector or specific domain such as healthcare. The Crown Commercial Service in the United Kingdom, the Central Public Procurement Office in Latvia, and similar bodies in other member states all operate as centralised purchasing bodies for their respective jurisdictions.

Cross-border joint procurement

EU procurement law explicitly supports cross-border joint procurement, where contracting authorities from different member states combine their procurement activities. Cross-border joint procurement faces additional complexity because of differences in national procurement law, language, and administrative culture. Despite the complexity, it has grown over time, particularly in healthcare procurement where pooled demand can secure better access to limited-supply medical products.

The COVID-19 pandemic accelerated cross-border joint procurement in healthcare. EU member states cooperated through joint procurement of vaccines, ventilators, personal protective equipment, and other critical supplies. The experience demonstrated both the potential of cross-border joint procurement and the practical challenges in operationalising it across diverse national systems. Lessons from the pandemic continue to inform cross-border procurement policy.

Outside healthcare, cross-border joint procurement remains less common but is growing. Areas where it has developed include defence procurement under common European programmes, scientific research equipment for shared facilities, and infrastructure for cross-border transport networks. The European Commission supports cross-border joint procurement through funding for capacity building and through legal guidance on the relevant procedures.

Implications for suppliers

Joint procurement creates both opportunities and challenges for suppliers. The opportunity is access to larger, more strategic contracts than would be available from individual buyers. Winning a centralised framework or a major joint procurement can deliver years of stable revenue across multiple downstream buyers. The challenge is the more sophisticated competition that joint procurement attracts. Major joint procurements typically draw bids from established suppliers with strong references, leaving less room for newer or smaller competitors.

Suppliers also need to understand how joint procurement contracts translate into actual buying behaviour. A framework agreement awarded by a centralised purchasing body may be used heavily by some downstream buyers and barely at all by others. Predicting which downstream buyers will actually call off from the framework is critical for forecasting revenue and managing the contract relationship. Sophisticated suppliers track call-off patterns and engage actively with downstream buyers to encourage utilisation.

Related terms

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