Procurement process commences for new category management services

NHS Supply Chain has formally launched the procurement process for category management services with planned award dates in early 2023 and implementation by the end of 2023. These services form part of its Target Operating Model (TOM) programme as an evolution of the existing approach.

Contracts for the current outsourced category tower service provider model end in 2023.

The next iteration of the NHS Supply Chain TOM will not only continue to deliver improved efficiencies and greater value for the NHS but will look to; become more flexible and resilient, strengthen capabilities, embed sustainability into its DNA; aligning business priorities to wider NHS priorities.

The landscape for Procurement and Supply Chain has changed creating a need for a broader range of priorities in our decision making.  This includes total cost, environmental impact, supply chain resilience, social value, quality, flexibility, and availability. This broader focus requires a different approach in how we develop, and add new, capabilities but also how we ask our suppliers to operate.

This is an exciting time for NHS Supply Chain as we set out our vision and strategy for the future enabled by the next iteration of the operating model, integrate Personal Protective Equipment back into a single supply chain, and are focussed on delivering a whole range of high value products and services that makes it easier for the NHS to put patients first.

Andrew New, Chief Executive, NHS Supply Chain

The Invitation to Tender (ITT), published on 11 April 2022, invites submissions from parties interested in entering contractual arrangements to operate as a Category Management Service Provider (CMSP) on behalf of NHS Supply Chain to procure goods and/or services.

Procurement will be conducted under a single process across four defined product groups. These are:

• Medical Consumables – surgical consumables and infection control
• Medical Consumables – rehabilitation and community
• Non-Medical – food
• Non-Medical – facilities (including office supplies).

Interested parties have until midday on 1 June 2022 to submit a completed supplier questionnaire, and will then be shortlisted and invited to submit initial tenders, week commencing 4 July 2022.

Total estimated value of the CMSP contracts is £198 million, excluding VAT.

All contracts will be for an initial period of 45 months (excluding the three-month implementation period) with a possible extension of up to 24 months, subject to relevant criteria set out in the contracts being achieved.

As part of the CMSP procurement process, NHS Supply Chain will provide category management activity for Medical Capital and Medically Complex categories from its existing tower structure. These two categories will join the Personal Protective Equipment category recently transitioned from the Department of Health and Social Care.

By delivering category management activity for these categories, the NHS Supply Chain will have greater control developing resilient, assured supply chains that achieve the needs of clinical colleagues. The NHS Supply Chain will better facilitate clinical switching decisions on the front line, align care pathways and deliver more value to the NHS.

Insourced groups are:

• Medical Capital – large capital diagnostics equipment with smaller scale diagnostics, pathology and point of care testing
• Medical Clinically Complex – surgical products and services
• Personal Protective Equipment – masks, gowns, aprons, gloves and other items used for COVID-19 pandemic and other settings.

See our Useful Links section for more information relating to this press release.

All information in this press release is correct at the time of going to press.

About NHS Supply Chain

NHS Supply Chain manages the sourcing, delivery and supply of healthcare products, services and food for NHS trusts and healthcare organisations across England and Wales.

Managing more than 8 million orders per year, across 94,000 order points and over 17,500 locations. NHS Supply Chain delivers over 28 million lines of picked goods to the NHS annually and our systems consolidate orders from over 930 suppliers, saving trusts time and money in removing duplication of overlapping contracts.

NHS Supply Chain aims to deliver savings of £2.4 billion back into the NHS by 2023/2024, leveraging the buying power of the NHS to drive savings and provide a standardised range of clinically assured, quality products at the best value through a range of specialist buying functions. Its aim is to leverage the buying power of the NHS to deliver savings back into NHS frontline services.

There are 11 specialist buying functions in the current operating model, these are known as Category Towers, delivering clinical consumables, capital medical equipment and non-medical products such as food and office solutions. Two enabling services for logistics and supporting technology underpin the model.

Working in partnership with NHS trusts, service providers, and stakeholders, NHS Supply Chain aims to:

• Anchor the business on the needs of the NHS by supporting NHS trusts to deliver safe and excellent patient care.
• Further strengthen the resilience of the supply chain by continuing to invest in key tools and capacity that build resilience and performance.
• Deliver clinically assured, safe products that support improved outcomes for patients and users.
• Support the NHS objective of becoming the world’s first net carbon zero national health system.
• Ensure a high performing workforce and highly efficient organisation.

Oversight and operational management of NHS Supply Chain is delivered by the management function, Supply Chain Coordination Limited (SCCL). SCCL was incorporated on 25 July 2017 and is a company registered in England and Wales, company number 10881715. NHS Commissioning Board (NHS England and NHS Improvement [NHSEI]) are the sole shareholders of SCCL.

SCCL is a separate organisation to NHSEI and remains part of the NHS family.