This is a summary of our 2017 Strategic Suppliers report. The full version, including a complete breakdown by supplier, is available to Tussell Insight subscribers.
Welcome to our special edition Strategic Suppliers report covering the full year 2017.
2017 was a mixed year in public procurement for the Strategic Suppliers*. The Strategic Suppliers and their subsidiaries and joint ventures picked up new public sector awards with a lifetime value of £6.5B but their estimated share of framework value declined by 49% year-on-year.
Strategic Suppliers - Overview
Outsourcing and Construction firms – such as Capita, Carillion and Interserve – won nearly half (44%) of the government contracts issued in 2017. It is interesting to note that Consulting firms, including the Big 4, won the next largest volume of awards and frameworks.
Strategic Suppliers - Breakdown by Volume 2017
High value contracts issued to firms such as Amey, Carillion and Interserve meant that Outsourcing & Construction firms won the majority of both award value and estimated framework value issued to the Strategic Suppliers.
The top government contracts won by these suppliers included the £11.8B HS2 main civil engineering framework and a £648M award to run the Manchester Metrolink system for 7 years.
Strategic Suppliers - Awards and Frameworks 2017
The Department for Work & Pensions and Ministry of Defence issued the largest total award value (excluding frameworks) to the Strategic Suppliers of the top Ministerial Departments. The DWP issued three of the top 10 contracts to the Strategic Suppliers – for security services, facilities management and employment support.
Strategic Suppliers - Award Value from Top Ministerial Departments (2017)
Strategic Suppliers operating in the IT sector are significantly exposed to awards expiring during the rest of 2018, with £366M or 21% of their live award value running off this year.
Amey and Serco will see large value Prisoner Escort Services contracts issued by the Ministry of Justice expire during the course of 2018.
Strategic Suppliers - Expiring Contracts
*As of January 2018, the Strategic Suppliers to the UK government are as follows - IT: ATOS, Capgemini, CGI, DXC Technology, IBM, Fujitsu, Microsoft, Oracle, Sopra Steria. Outsourcing and Construction: Amey, Atkins, Capita, Engie, G4S, Interserve, ISS, Mitie Group, Serco Group, Sodexo. Defence: Babcock International, BAE Systems. Telecoms: Arqiva, BT Group, Motorola, Virgin Media, Vodafone. In addition, Tussell breaks out the following Consulting firms: Accenture, Bain & Company, Boston Consulting Group, Deloitte, EY, Grant Thornton, KPMG, Mckinsey & Company, PA Consulting, PwC.