Chain reaction – the benefits of supplier agreements
General News, Project News

Chain reaction – the benefits of supplier agreements


Even the smallest of construction jobs can involve lengthy supply chains and when relationships break down, weak links can threaten the successful outcome of the entire project. Senior Architectural Systems’ national specification manager, Andrew Cooper, looks at how supply chain agreements are redefining the role of the supplier.

In an industry that has a long-standing tradition of competitive tendering, collaborative working practices are widely discussed but often prove harder to implement. With budget constraints always paramount, the temptation to award a contract to the ‘lowest bidder’ is a real barrier to creating a more holistic approach to project delivery and although this type of tender can provide cost savings, it certainly doesn’t create the best value.

Increasingly many main contractors are recognising the benefits of reducing their supply chain to develop stronger, more productive working relationships and promote close and early collaboration with key suppliers. To become a ‘preferred supplier’ is obviously a key goal for many manufacturers but to assume that trading agreements are just about financial incentives is to overlook their most important purpose. Unlike competitive tendering, collaborative tendering and trading agreements facilitate early engagement and this can bring a number of significant benefits to main contractors, suppliers and specialists alike.

For our part, Senior has embarked on a number of supplier agreements with several leading main contractors such as John Sisk, Galliford Try, Morgan Sindall, Interserve and Robertson Group. By having such partnerships in place, our early involvement at the design stage has allowed us to influence the choice of system specified but it would be short sighted to think that the only benefits of this are to our own order book. 

rsz_merchant_walk_1Our recommendations are based on having access to the vital specification information and are supported by full technical documentation and calculations that ensure that the correct criteria are met.  Senior’s involvement at this stage can provide contractors with an advantage over their competitors whose own tenders may not include the same level of technical detail. We also make all supporting documentation available to our clients for use alongside their own tender documents and increasingly, we are being asked to provide further support, in terms of meeting with architects, clients or other bodies to support our inclusion in their bid. 

Value engineering is also reliant on effective collaboration and communication within the supply chain.  Such solutions can bring significant monetary benefits to a project but they need to be identified at the earliest opportunity to maximise the benefits before the design and costs are frozen.  By working with main contractors at the tender stage, we are able to identify methods of guaranteeing compliance with the specification, utilising the most cost effective fabrication methods and fenestration systems available. An example of this on a recent contract was when we saw an opportunity to suggest a window system that could offer better thermal performance and lower U-values than were required but with minimal effect on cost.  The knock-on effect of this is that other elements of the building design and programme were then reviewed and by reducing the need for other potentially more expensive energy-saving elements such as photovoltaic roof panels or under floor insulation, additional cost-savings were identified.

project-dysonWhere tender documentation is received specifying alternative systems, we are able to examine this in detail, offer competitively considered compliant alternatives, again with full details of calculations and documentation to support the proposed specification change. Here close collaboration with our own fabricator base is vital.

Once a project is secured, this involvement continues through the design process and beyond. Recently I have been involved with a contractor through their two stage tender process, assisting with achieving financial closure giving advantages to them, then the fabricator selection process, moving forward to attending design meetings and then site visits to ensure best practice and all specification and technical matters are being adhered to.

With the rise of BIM and its reliance on shared information, it remains to be seen how far the industry can comfortably embrace true supply chain collaboration and if the nature of the more traditional supplier agreements will change.  There is strength in numbers though and by working together to realise a shared goal, every member of the project team can reap the rewards of successfully delivering a contract from conception to completion.

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