We have reviewed this resource to keep it up to date with law and practice.
Procurement in construction toolkit
A guide to Practical Law's construction procurement materials.
What is procurement?
In the context of a construction project, and in many wider commercial contexts, procurement refers to the process of obtaining a product or service. On a construction project, it is a way of allocating design and construction responsibility. For example, deciding and allocating contractual responsibility for the design and construction of a project. Construction professionals (including construction lawyers) call the different methods of making that allocation "procurement routes".
This is separate from public procurement, the regulation of the way in which public bodies must manage their contracts. This toolkit does not refer to public procurement. For more information, see Practice note, Public procurement in the UK ( www.practicallaw.com/5-383-9734) .
Common procurement routes
The most common procurement routes for a construction project in England and Wales are traditional contracting and design and build contracting:
In traditional contracting, a professional consultant (often an architect) will design the works under a professional appointment. A building contractor will carry out the works under a building contract.
In design and build contracting, the contractor will carry out the works and be responsible for the design of the works too. Exactly what that means in practice can vary. Sometimes the contractor designs the whole of the works, other times it accepts responsibility for designs started by a professional consultant. Alternatively, the contractor may accept responsibility only for completing the design, based on another party's initial designs.
Whatever the procurement route, nearly all commercial construction projects involve a team of professional consultants including one or more engineers alongside the architect. Typically, the architect (or another professional consultant) will manage the day-to-day relationship with the contractor on behalf of the employer. The contractor will appoint sub-contractors to carry out the works.
For more information on common forms of construction procurement and a summary of their advantages and disadvantages, see Practice note, Procurement: common construction procurement methods ( www.practicallaw.com/9-329-1308) .
Visualising procurement routes
Construction lawyers often use a diagram to help them understand the parties involved in a new project and the relationships between them. A procurement diagram can give a skeleton procurement route, onto which a party may add the names of those actually involved. (Procurement diagrams may also be a useful introduction to construction procurement routes for business lawyers unfamiliar with construction procurement, or for a law firm to use with trainees.) We publish practice notes:
Collateral warranties and third parties
The sometimes complex nature of contracts and contractual relationships between parties on a construction project means that one or more parties may often need to benefit from collateral warranties or third party rights.
For the most common construction procurement routes, we publish diagrams showing the key third parties who may be given collateral warranties or third party rights, see practice notes:
For more information on collateral warranties and third party rights, see practice notes: