Your guide to Dynamic Markets: what are they, what’s changed and why are they important

If you’ve been in the world of procurement over the past couple of years, you’ll have heard the term “Dynamic Market” (DM) cropping up more and more. Since the new regulations came into force last year, they’re another procurement route available to contracting authorities alongside traditional frameworks and new “open frameworks.” 

We’ve built our own Dynamic Markets to give members more flexible access to compliant suppliers. But we know it’s a change to the previous DPS models out there. So we’re breaking down what they mean for you in a handy guide: what are they, what’s changed compared to previous regulations, and why are they worth your attention.

What is a Dynamic Market? 

A Dynamic Market, like a traditional framework, is a list of compliant suppliers that contracting authorities can use to award contracts, without needing to go to the open market from scratch every time. A key difference is the way suppliers join a Dynamic Market. It’s more streamlined compared to a framework – they apply to join, are assessed against conditions of membership such as technical ability and financial capability, and (if they meet the requirements) are added to the list. 

Their defining feature is that the Dynamic Market stays open until the Contracting Authority wishes to end the DM, via a notice. Unlike a traditional framework, a Dynamic Market remains open to new suppliers throughout its lifespan. By allowing new suppliers to join throughout its lifetime, a Dynamic Market helps maintain competition, encourages innovation and provides access to a wider and more diverse supplier base. This is especially handy when it comes to procuring contracts and consulting with your leaseholders under Section 20. 

What’s changed? 

Essentially Dynamic Markets are the evolution of “Dynamic Purchasing Systems” (DPS’s) which exist under the old PCR2015. DPS's still in place can only run until February 2029. 

The Procurement Act 2023 has changed some important aspects for Dynamic Markets. The key differences are:

• They’re no longer limited to off-the-shelf purchases – DPS’s could only be used for commonly available, standardised goods and services. DM’s can be used to procure a much wider range of goods, services and works. This provides greater flexibility for contracting authorities.
• Restriction on below threshold contracts – Contracts below the services threshold of £207,720 can’t be put through a Dynamic Market. This means smaller projects below the services threshold may not fit this model, and will revert back to traditional frameworks or one-off tender processes.
• New suppliers can join the Dynamic Market following PME – If a supplier isn’t on the DM yet, but has been involved in PME for a specific tender, they can apply to join and be considered alongside existing members. This means the door isn’t shut and it supports more genuine and ongoing market engagement.
• Early supplier engagement maximises competition - When using a DM buyers should build preliminary market engagement (PME) into your procurement timetable. This helps ensure a broader range of suppliers participate from the beginning and supports fair, transparent competition. In this way Dynamic Markets can help buyers understand market capacity, shape proportionate requirements and attract new suppliers.
• Increased transparency requirements – Contract award and contract notices now need to be published in line with standard contract requirements. This gives the market more visibility over what’s being awarded and to whom. When using an SEC DM we'll publish all notices required before you get to contract mobilisation and delivery – here’s more detail on what this covers.

Why do they matter? 

For housing providers and Contracting Authorities, a DM offers a quicker route to a compliant supplier without the lead time of an open market tender. Because the supplier list stays open, you’re also drawing from an up-to-date supplier pool, and can include local / specialist suppliers in your tender. They're effective where requirements are recurring, supplier capabilities evolve over time, or you want to attract local, specialist and SME suppliers. 

For suppliers, the open, ongoing nature of a DM is the biggest change. You’re not locked out of the process if you missed a framework tender. You can apply to join at any time and once you’re in you’ll be notified of all relevant opportunities when they arise. Opportunities advertised through the Dynamic Market are also visible to the wider market. This gives prospective suppliers the chance to apply for membership and compete for future contracts.

Our Dynamic Markets 

We’ve already committed to building Dynamic Markets for our customers. Earlier this year we launched two DM’s covering Facilities Management and Repairs & Maintenance. 

If you want to know more about Dynamic Markets, or you're a supplier interested in joining one, our team is here and happy to talk you through the process. 

Want to know more about our frameworks? Check out all our procurement routes: Our frameworks | South East Consortium