What Is a Dynamic Market and What Do They Mean For Public Sales Teams

What is a Dynamic Market?                      

If you’re looking for one sentence to describe what a Dynamic Market is then we’d say, “they’re a list of qualified suppliers who can provide a pre-determined range of products or services to buyer(s)”.

If you’re looking for a bit more meat on that bone, then don’t worry, we go into more detail on what a Dynamic Market is below, as well as what they mean for buyers and suppliers across UK public procurement.

How do Dynamic Markets work?

Unlike Frameworks, a Dynamic Market remains open for suppliers to join throughout its entire lifetime, (rather than on a few occasions like in an open market) with no limit on the number of suppliers that can join and win work from the Dynamic Market.

How do suppliers enter Dynamic Markets?

All suppliers within a Dynamic Market have been assessed by the contracting authority themselves  and confirmed to have the legal, financial and technical ability to fulfil public sector contracts based on the pre-determined products and services set out in the Dynamic Market, similar to the processes within Frameworks.

So, in a functional capacity they’re like open Frameworks but rather than having certain windows where new suppliers can apply and join, they allow suppliers to enter the Dynamic Market whenever they meet the entry requirements.

Can suppliers be removed from Dynamic Markets?

Suppliers can be removed from a Dynamic Market if they no longer meet the initial requirements set out for their entry.

This type of exclusion could be the result of a supplier no longer being able to effectively supply the product or service the Dynamic Market is setup to provide. It could also be due to a supplier having security concerns, such as a data breach.

If a supplier is found to be in breach of the Procurement Act 2023, they could also be excluded from a Dynamic Market.

What are the key benefits of Dynamic Markets?

Understanding how Dynamic Markets will be improving life for buyers and suppliers is crucial to getting to grips with them, so we reduced the main pros into a short list below.

• Dynamic Markets encourage innovation by allowing new suppliers to join across its lifespan. Frameworks, which ring-fence markets by having limited entry schedules,
• With simplified conditions and requirements smaller and more niche suppliers are far less likely to be excluded from Dynamic Markets than from Frameworks.
• With more suppliers able to bid and compete there will be more opportunities for local and central authorities to push for greater value, both fiscally and socially. There will also naturally be better opportunities for SME and local businesses to work with regional authorities.
• Every supplier is considered for all call-offs, allowing suppliers to take more innovative approaches to win business and achieve better outcomes. This helps to drive financial and social value throughout the entire life span of a Dynamic Market.

What are the downsides of Dynamic Markets?

While Dynamic Markets represent a continued effort by the UK government to shift public procurement to a more flexible base, they do still offer some challenges.

• There is an administrative barrier with Dynamic Markets, meaning some smaller suppliers may not have the peoplepower to apply and join a Dynamic Market alongside their other activity.
• Throughout their lifespans Dynamic Markets will have more and more suppliers enter and bid to win contracts. This means that the market is never truly settled and that the competitiveness only increases as time goes on.
• For buyers forecasting with Dynamic Markets is difficult. With suppliers frequently entering and leaving there is a distinct lack of certainty when it comes to predicting who they’ll be awarding work to.

Are Dynamic Markets the same as Dynamic Purchasing Systems?

While they share some similarities to DPSs (Dynamic Purchasing Systems), Dynamic Markets aren’t limited to commonly purchased products like the preceding example. There are still some limitations but they’re nowhere near as strict as those outlined within DPSs.

For example, within the Crown Commercial Cyber Security Services DPS buyers utilise a list of limited suppliers who provide tried and tested cyber security solutions from known suppliers. If a buyer wants to procure for anything that is within the IT space but outside of cyber security, they will have to do so separately.

If this was within a Dynamic Market they would be able to do so within the market itself.

Where can we expect to see Dynamic Markets in the future?

We certainly won’t be seeing dynamic markets everywhere, but you can expect to see them where Frameworks may have been used previously but where the likelihood of innovation and market growth are much more likely.

An educated guess would point to these being implemented frequently within ICT & BPO markets, so keep an eye out for announcements of their implementation and be prepared for more opportunities, even if you’ve not looked at joining frameworks in the past.