HS2 SUPPLIER GUIDE.

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Ruby Glenn
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1 HS2 SUPPLIER GUIDE

2 About this guide This guide has been developed to help suppliers find out more about the High Speed Two project. This is the first edition it will evolve along with our project. It highlights what is important to us and what will be required from our supply chain. It also provides our first answer to the following questions: 4 6 What is HS2? What will we be buying? High Speed One, the Olympics and Crossrail were big: this is bigger. We want you to get involved now. Add your expertise to ours and seize the opportunities in what will be Europe s largest mega-project. 10 When will we be buying? 11 Where can you access HS2 opportunities? 13 How will we engage with you? 14 What do we want from the supply chain? 16 What can you do now?

Introduction Our new North-South rail link is the biggest and most ambitious infrastructure project in the UK, and the first new railway to be built north of London in over 120 years.

3 Introduction Our new North-South rail link is the biggest and most ambitious infrastructure project in the UK, and the first new railway to be built north of London in over 120 years. High Speed Two will be a vital part of our national transport network, serving hundreds of thousands of people every day. But it can also be an engine for growth, supporting the development of new homes and careers, and helping to rebalance our London-centric economy. Its positive effects will be felt long before the first trains start running. HS2 presents a great opportunity for businesses, big and small, to compete for design and construction contracts. By contributing their innovation, experience and ability to deliver, they will help make this an exemplary project one which maximises the value of HS2 to local and national economies, and allows the UK to compete internationally in state-of-the-art engineering. We want to provide the environment for businesses to work collaboratively and achieve success. That s why we have already started listening to the market at an early stage and on a large scale. Many hundreds of businesses have helped us to shape our approach to procurement during a national market engagement exercise. We want to ensure that the best companies can identify and compete for contract opportunities. To facilitate this, we require our main contractors to use open procurement tools, such as Contracts Finder and CompeteFor, and to simplify the procurement process as much as possible in order to reduce barriers for SMEs. Companies should start preparing now: we want you to get on board and play a part in delivering this nationally important project. Sir David Higgins, HS2 Chairman

4 WHAT IS HS2? High Speed Two will be built in two phases to ensure that the benefits of high speed rail are realised as early as possible. Phase One will consist of around 140 miles of track and connect a redeveloped Euston with stations at Old Oak Common in West London; at Birmingham Interchange near Birmingham Airport and the National Exhibition Centre; and at Birmingham Curzon Street. This guide focuses on Phase One. Phase Two will extend the lines from Birmingham to Manchester, the East Midlands, Sheffield Meadowhall and Leeds. The High Speed Rail (London-West Midlands) Bill, now before Parliament, seeks the powers to build, operate and maintain the new railway. Construction of Phase One is due to start in 2017, with the first trains running in Phase Two services are expected to start running to Manchester and Leeds in Phase One

5 WHAT IS HS2? As a non-departmental public body, wholly owned by the Department for Transport, HS2 Ltd is the company charged with the delivery of the railway. HS2 is vital for Britain if we are to succeed in the global race. Prime Minister David Cameron Our vision is to make HS2 an engine for growth. The new railway will revitalise Britain s transport networks and provide the capacity and connections to drive the national and regional economies. Our MISSION is to work together with stakeholders to maximise the value that HS2 delivers.

what will we be buying? HS2 is one of the most demanding and exciting transport mega-projects in Europe. There will be thousands of opportunities within the HS2 supply chain.

6 what will we be buying? HS2 is one of the most demanding and exciting transport mega-projects in Europe. There will be thousands of opportunities within the HS2 supply chain. These will be: ycreated across many business sectors, requiring a wide range of capabilities; ysuitable for suppliers of all sizes; and ygenerated over a number of years. We will need a full range of works, goods and services to deliver our major works packages and supporting corporate opportunities. See the next page for the categories that we are now focusing on to deliver Phase One.

7 CategorieS 0.4 bn 3bn 3.8bn 2.9bn 1.7 bn 7.5 bn DESIGN & Services TUNNELS SURFACE ROUTE STATIONS RAILWAY SYSTEMS ROLLING STOCK This relates to design and other professional services. Relates to the subsurface sections of the route, including tunnels, portals and shafts. Includes elements such as earthworks, drainage, cuttings and embankments, bridges, viaducts and other structures. Euston Old Oak Common Birmingham Interchange Curzon Street Includes permanent way, overhead line electrification, signalling, telecommunications, traction power and electrical distribution. Price includes rolling stock for Phase One and Phase Two. Enabling and Advance Works costs are included within the figures provided and not identified separately. Certain elements, such as Euston station development and some elements of railway systems, are excluded from the above categories. Figures above are 2011 prices.

8 what will we be buying? In addition to these categories, we will have various requirements for the day-to-day management and running of our business. These non-construction direct opportunities will be lower in value, but more numerous, and wherever possible they will be procured via existing government frameworks. For each category, we will buy a relatively small number of high-value, direct contracts. However, other large UK infrastructure projects, including the Olympics and Crossrail, have shown that for every direct contract the client buys, many more indirect opportunities will be created. We estimate that for every tens of direct (ie, Tier 1) contracts, these are likely to generate tens of thousands of supply chain opportunities. These are the opportunities that will be of most interest to SMEs, as they will be the best match for their scale of operations and their specific capabilities. They are not subject to public procurement legislation, and suppliers from Tier 1 (and below) will offer these contracts directly. We want suppliers to see these opportunities as they arise, so they can compete for them, win work and become part of our supply chain. 60% We expect 60% of contract opportunities arising in the supply chain to be awarded to small and medium-sized enterprises.

9 what will we be buying? HS2 DIRECT OPPORTUNITIES Hs2 Ltd 10s TIER 1 Main contractor Joint venture HS2 INDIRECT OPPORTUNITIES TIER 2 Subcontractor Supplier TIER 3 Subcontractor Supplier 10,000s TIER 4 and 5 Subcontractor Supplier

10 When will we be buying? It is vital to have a plan which is right first time. That s why we are taking the project step by step. By keeping our programme foreseeable, we can provide clarity on the project's phases and allow suppliers to start preparing at the right moment. We will procure a range of goods, works and services across the entire programme. We have already started procuring as part of Phase One and will need to do so until completion in However, many of the major works packages in each category will be procured between 2015 and We will share more detail as the project progresses look out for information on forthcoming business opportunities on our website and at our industry days. The adjacent diagram indicates the approximate procurement and delivery sequence. Design and other professional services Enabling and advance works Tunnels Surface route Stations Railway systems Rolling stock Indicative Procurement and ECI Stage 1 (where applicable) Indicative earliest start of construction/manufacture Typically, ECI contract awards for civil engineering packages will occur months prior to start of construction.

11 Where can you access HS2 opportunities? As a publicly funded organisation, HS2 Ltd is bound by EU Procurement Directives and associated UK legislation. Above certain spending thresholds, we will be required to advertise our contract opportunities in the Official Journal of the European Union. For opportunities below these thresholds, we will help suppliers to identify and access the most appropriate opportunities for their business. Opportunity source HS2 Direct Where to look Above OJEU thresholds * Tender Events Daily Below OJEU thresholds * Contracts Finder HS2 Website CompeteFor The adjacent table sets out where we will be advertising all appropriate direct opportunities, and where we will encourage the supply chain to advertise their indirect supplier opportunities. Where appropriate, some direct opportunities will be sourced through existing public sector frameworks. To find out how to join an existing framework, visit the Crown Commercial Services website at Supply Chain Indirect * Current EU thresholds can be found at

12 Where can You access HS2 opportunities? DIRECT PROCUREMENT We will make our procurements using an electronic sourcing tool. This allows the process to be efficient, open, transparent and fully auditable. Register on our e-procurement portal so you can respond to direct HS2 tender opportunities as they arise: INDIRECT PROCUREMENT We will require our direct suppliers to use an electronic brokerage system for all appropriate supply chain opportunities, where a preferred supplier has not already been engaged as part of a tender submission. To learn about indirect HS2 supply chain opportunities, go to and either register, or review your existing company profile and the categories to which you supply.

13 How will we engage with you? category Industry days Regional roadshows Market soundings Meet the Contractor days Open to all appropriate supply chain organisations in each category, these events will inform potential suppliers of our requirements and will facilitate supply chain networking. We will hold these events as the category nears procurement. These events will update local businesses on the project's progress, so they can get ready to respond to supply chain opportunities. We will work with local enterprise parterships, British Chambers of Commerce and national enterprise agencies, including the Welsh Government, Scottish Enterprise and Invest Northern Ireland. We will ask relevant Tier 1 suppliers to provide feedback on our procurement approach, including how we plan to package and contract, as well as the perceived risks. By inviting their supply chain to provide input, direct organisations can help us achieve maximum market appetite and efficiency in delivery. We will work with our direct (ie, Tier 1) suppliers to better understand their supply chain needs. By collaborating with trade and business networks, we will identify suppliers that match Tier 1 s requirements and facilitate one-to-one meetings. Add the HS2 events page ( to your favourites and check back regularly to find out about forthcoming events. us at SCC@hs2.org.uk to tell us about your areas of interest, so we can keep you updated.

14 What do we want from the supply chain? As a publicly funded organisation, we must be able to demonstrate that we have achieved value for money. Our Balanced Scorecard shown on the next page sets out what is important to us: how we will deliver lasting benefits, measure our progress and realise our vision. Our Balanced Scorecard is all about sustainability, be it environmental, social or economic. We must deliver a sustainable solution, and must do so in a way that extends economic opportunities, sets exemplary standards of health and safety, supports training and careers, and allows us to meet our environmental responsibilities with a respect for people, communities and wildlife. To do this, we must ensure that the companies in our supply chain are aligned with our eight strategic goals, which are shown on the right. During procurement and delivery, we will evaluate suppliers performance against each strategic goal by testing a number of critical success factors. Each factor will be weighted to reflect the nature of the contract. For example, for the strategic goal of Health, Safety and Security, we will look for suppliers to demonstrate the highest safety standards in their tenders. We will then measure their performance to ensure that we are getting what we were promised. This will be an area of focus for all contracts, allowing us to benchmark performance across the project. Our critical success factors will be developed to establish benchmarks during procurement that will be later tested during delivery. Our 'enablers' are practical ways of working with our supply chain. They will be written into our procedures and contracts with suppliers, and reflected in the way we do business. We will also encourage our Tier 1 contractors to apply the scorecard when procuring their own suppliers and managing supplier performance. Health, safety and security Benchmark for delivery and operational excellence Design for passengers Environment Vibrant city regions Skills and employment On time On budget

15 our Balanced Scorecard HS2 VISION Value for money Health, safety and security Benchmark for delivery and operational excellence Environment Vibrant city regions Strategic GOALS CRITICAL SUCCESS FACTORS Design for passengers Skills and employment On time On budget Modern methods of construction Incentives Collaboration Innovation Enablers PERFORMANCE Integration Risk ownership Transparency Benchmarks for design and delivery established within contracts Standard set of KPI measures Our Balanced Scorecard combines: Environmental aims Economic aims Social aims

16 What can you do now? Access our supply chain resources Visit the business section of the HS2 website to review and download key information about the project. Register to join our prospective supply chain community us at Supply Chain Communications and we will add you to our distribution list. We will invite you to events, highlight new opportunities and update you on the latest project news. SCC@hs2.org.uk Send us your questions and stay in touch Share your supply chain questions and comments with us, update us with any changes of address or telephone number, and nominate a key individual for us to liaise with as your preferred point of contact. CS086

HS2 Supply Chain FAQs

HS2 Supply Chain FAQs As part of our ongoing market engagement activity, High Speed Two (HS2) Limited contacted four key umbrella, industry and trade associations. Our aim was to poll a sample of their