"Procurement" is one of those words that sounds more complicated than it is. If you have ever heard that the public sector is a huge customer but weren't sure how to actually sell to it, this guide is the place to start.
At a glance
- Procurement is the process of finding, buying and managing the goods, services and works an organisation needs.
- Public procurement is when government and the wider public sector do this — using public money, under a set of rules.
- Those rules are designed to be fair, transparent and open to competition, so any capable supplier can bid.
- In the UK, public contracts are advertised on official portals like Find a Tender and Contracts Finder.
What does procurement mean?
At its simplest, procurement is buying — but done in a structured way. Rather than picking a supplier informally, an organisation defines what it needs, invites suppliers to compete, evaluates the offers, and awards a contract. The aim is to get good value while treating suppliers fairly.
In a business context "procurement" usually means the department or process that handles purchasing. In the world of government contracts, it has a more specific meaning, because public bodies are spending taxpayers' money and have to follow the law.
What is public procurement?
Public procurement is how the public sector buys what it needs — everything from IT systems and consultancy to cleaning, construction and care services. The bodies doing the buying are called contracting authorities: central government departments, councils, the NHS, universities, police forces, and many more.
Because public money is involved, public procurement is governed by rules that exist to ensure:
- Fair and equal treatment of suppliers
- Transparency, so spending can be scrutinised
- Open competition, so the best value wins
In England, Wales and Northern Ireland, those rules now come from the Procurement Act 2023, which came into force on 24 February 2025 and replaced the Public Contracts Regulations 2015. Scotland has its own procurement rules. (See the Procurement Act 2023 explained.)
How the public sector buys: the basics
While every procurement is a little different, most follow a recognisable shape:
- A need is identified — the authority decides what it wants to buy.
- The opportunity is advertised — usually on an official portal, so suppliers can find it.
- Suppliers bid — by responding to the published documents.
- Bids are evaluated — against published criteria (price and quality).
- A contract is awarded — to the winning supplier, with the decision made public.
Higher-value contracts (above £135,018 including VAT for most central government goods and services, from 1 January 2026) must be advertised on Find a Tender. Lower-value opportunities must still be published once they exceed £12,000 including VAT for central government or £30,000 for the wider public sector. (NHS trusts count as central government, so their floor is £12,000.) (Our guide to where to find UK tenders covers every portal.)
Why it matters for your business
Public procurement is a genuinely open market. Contracts are advertised publicly, the rules require fair treatment, and the system is being actively reshaped to bring in more small businesses and social enterprises. If you sell something a council, hospital or government department buys, there is very likely a contract out there for it.
The hard parts are finding the right opportunities across a fragmented set of portals, and then writing a submission good enough to score well against experienced competitors. Neither is a reason not to sell to the public sector — but both are reasons plenty of capable suppliers never start.
Common terms you'll meet
- Contracting authority — the public body doing the buying.
- Tender — a formal offer (bid) you submit, or the process of inviting bids. See what is a tender.
- Framework agreement — a pre-approved list of suppliers buyers can call off from. See framework agreements.
- Social value — the wider economic, social and environmental benefit a contract can deliver. See what is social value.
Frequently asked questions
What is procurement in simple terms?
It is the structured process of finding, buying and managing the goods, services and works an organisation needs — defining the requirement, inviting competition, evaluating offers and awarding a contract.
What is the difference between procurement and purchasing?
Purchasing is the act of buying. Procurement is the broader, managed process around it — including planning, advertising, evaluating suppliers and managing the contract.
Who regulates public procurement in the UK?
For England, Wales and Northern Ireland, the Procurement Act 2023 (in force since 24 February 2025). Scotland has its own procurement legislation.
Where are public contracts advertised?
On official portals: Find a Tender (high-value, UK-wide), Contracts Finder (England, including lower values), Public Contracts Scotland, Sell2Wales and eTendersNI.
Sources
- GOV.UK — Public sector procurement guidance
- GOV.UK — Transforming Public Procurement (collection)
- GOV.UK — Find high value contracts in the public sector (Find a Tender)
- GOV.UK — Contracts Finder
- GOV.UK — Guidance: Below-Threshold Contracts