Direct Award Vs Tender: Understanding the Differences in Public Sector Procurement

Direct Award Vs Tender: Understanding the Differences in Public Sector Procurement

When it comes to public sector procurement, organisations typically have two main routes to engage suppliers: competitive tendering and direct award. Each approach has its place depending on the nature of the requirement, timelines, budget, and strategic goals.

At Hague, we work with a wide range of public sector and framework clients and regularly support customers through both routes. Whether we’re responding to formal tenders, or being awarded work through pre-approved frameworks, we recognise the importance of aligning with the procurement process that best suits each individual need. In this blog, we explore both methods, direct award and tendering, highlighting the differences, costs, and practical implications.

What is a tender?

A tender is a formal procurement process where buyers invite multiple suppliers to submit bids for the delivery of goods, services, or works. The process is competitive, designed to be transparent and to achieve value for money by comparing offers on both cost and quality.

A typical tender process includes:

  • Preparing detailed specification and tender documents
  • Advertising the opportunity (e.g. on Contracts Finder or Find a Tender)
  • Responding to bidder queries
  • Receiving and evaluating bids
  • Conducting interviews, presentations or site visits
  • Awarding the contract and completing due diligence

This route is most commonly used when there’s a requirement to demonstrate open competition, particularly for high-value or strategically significant contracts.

What is a direct award?

A direct award allows a buyer to appoint a supplier without running a competitive tender process. This is typically done through a framework agreement or dynamic purchasing system (DPS), where pre-approved suppliers have already been assessed for compliance, capability, and value.

Buyers can call off directly from a framework when specific conditions are met, such as:

  • Only one supplier is capable of fulfilling the requirement
  • The framework allows direct award under its terms
  • There is a clear justification based on urgency, continuity, or strategic alignment

This method is often used when there’s a need for speed, reduced administrative burden, or a desire to engage with a trusted, pre-qualified supplier.

Cost implications: tender vs direct award

One of the most notable differences between tendering and direct award lies in the cost and resource implications for buyers. Each method brings its own requirements, which can vary depending on the complexity, contract value, and internal capacity of the purchasing organisation.

Tendering: a structured but resource-intensive process

Running a competitive tender can be resource-heavy, especially for high-value or complex procurements. Some typical cost drivers include:

  • Staff time- procurement professionals, legal teams, and technical experts are often required to draft specifications, manage the process, and evaluate bids. Depending on the size and scope, this may cost anything from a few thousand pounds for smaller tenders, to well over £100,000 for high-complexity projects.
  • Advertising costs- public contracts are usually advertised on procurement platforms (e.g. Contracts Finder) and, in some cases, specialist trade publications or local press, adding to additional costs.
  • External advisors- for specialist or high-risk procurements, organisations may engage external consultants or legal advisors, which can significantly increase the overall budget.
  • Evaluation and due diligence- site visits, scoring panels, interviews, and background checks require additional time and resource, particularly in larger procurement exercises.
  • E-tendering platform fees- the use of procurement systems may involve licensing or transaction-based costs.

Direct award: streamlined but still regulated

A direct award can reduce many of the costs associated with competitive tendering, particularly in terms of administration and time. However, it is not cost-free:

  • Framework access and set up- buyers must have access to a compliant framework or dynamic purchasing system (DPS), which often involves procurement resource to evaluate and select appropriate routes in the first place.
  • Internal justification and audit trail- while not as extensive as a full tender, direct award decisions still require documentation, internal approvals, and due diligence to ensure transparency and legal compliance.
  • Ongoing performance monitoring- even in a direct award, buyers must still manage and monitor supplier performance, which requires resource throughout the contract lifecycle.

While direct award typically incurs lower upfront costs, especially for time-sensitive or lower-risk procurements, its important to remember that it still requires oversight and must be used appropriately within terms of the framework.

Conclusion

Direct award and tendering are both legitimate and regulated procurement routes, and at Hague, we support public sector organisations through either method, depending on what is most appropriate for their specific project, timeline, and internal resources.

If you’re unsure which process might apply to your next project, or would like to learn more about how Hague operates within both procurement models, get in touch with our team, we’d be happy to talk you through the options.

Written by Georgia Bannister

Georgia is the Senior Digital Marketing Executive at Hague, where she has made her mark over the past two years. While print is new territory for her, she's diving in headfirst, with a special interest in security print and labels. Off-duty, Georgia enjoys the balance of an active lifestyle, often found running, reading a good book or simply enjoying quality time with friends.