framework agreement

A framework agreement is a long-term agreement between a contracting authority and one or more suppliers that sets the terms for future purchases of goods or services. This is an efficient way for the public sector to procure, since they avoid having to conduct a full tender procedure every time they need something.

How does a framework agreement work?

When a public sector organisation knows it will need certain goods or services regularly over time, it can enter into a framework agreement. For example, a municipality might enter into a framework agreement with three suppliers of office furniture. Each time the municipality needs new furniture, they can order directly from one of these three without having to publish a new notice.

If the agreement is with multiple suppliers, the contracting authority can either:

• Select a supplier according to a predetermined allocation model
• Conduct a simple mini-competition among the suppliers

Key characteristics

A framework agreement cannot last longer than four years, unless there are special reasons. The agreement must also specify:

• Which goods or services can be purchased
• Expected scope of purchases
• How prices and deliveries will be agreed upon
• Which terms and conditions apply

Modern tools like Cobrief make it easier for suppliers to find relevant framework agreements and participate in competing for them. With a good overview of active framework agreements, businesses can secure long-term and predictable revenue.

A framework agreement provides security and predictability for both buyer and seller. The contracting authority gains assured access to the goods or services they need, while suppliers get a clear indication of future sales. This makes it easier for both parties to plan resources and capacity.