BAA mulls revamp of supplier frameworks

BAA is considering revamping all its multi-million pound supplier frameworks next year in an attempt to shave 30% off its costs.

CJ understands that the airports operator, which spends £450m per year on construction projects across its network (excluding T5), is looking to place all its second-tier suppliers, such as product and material suppliers, under the direct control of first-tier contractors using revised framework agreements.

Presentations have already been made to the industry on the proposed changes, and the revamped contracts are expected to be advertised on the OJEU early next year.

Several contractors new to airport works are expected to enter the bidding.

Prior to the recent development, BAA was in the process of renewing all of its five-year frameworks with new 10-year agreements, some of which involved merging different disciplines into one agreement. However, the expected changes mean that BAA is now likely to extend its current frameworks until the end of next year.

"BAA is coming under increasing pressure from travel operators to invest more in its infrastructure," one industry source said.

The source said changes to BAA’s frameworks would receive a lukewarm response from second-tier suppliers. "Many of them will be worried that they will now be reporting to first-tier suppliers, rather than interfacing with BAA direct. They will be concerned that they might not get the same treatment. It will all be about building supply chain relations."

The source added: "From BAA’s perspective, it wants to make the whole process simpler by reducing layers of interface, to tighten commercial operations and to put more accountability on its first-tier contractors."

A spokesman for BAA told CJ that rumours of framework changes are "inaccurate at this time". However, he admitted the company is reviewing its framework agreements.