You’ve read the tender. The service is squarely within your competence, you’d deliver it well, and the commissioner is one you’d like to work with.
Then you reach the selection questionnaire. Minimum annual turnover: £2 million. Yours is £700,000. Three contract examples of comparable scale required. You have one. Geographic coverage across the whole county. You operate in two boroughs.
Most providers close the document at this point.
They shouldn’t. The contract is still winnable, just not alone. Consortium bidding and subcontracting are legitimate, well-established routes into work that no single small provider could take on, and they’re explicitly encouraged under current UK procurement rules. Here’s how they work, and how to avoid the mistakes that sink them.
The Rules Are on Your Side
The Procurement Act 2023 was designed, in significant part, to open public contracts to smaller suppliers. Several provisions matter directly.
Contracting authorities now have a duty to consider dividing contracts into lots, which is the single most effective way of making large procurements accessible to SMEs. They must consider barriers to SME participation when designing a procurement, and cannot impose disproportionate requirements without justification.
Authorities can no longer require you to hold insurance before contract award, a requirement that previously forced small providers to incur real costs before knowing whether they’d won anything.
And on cash flow, the change most relevant to subcontractors: 30-day payment terms are implied into every public contract, and flow down through subcontracts in the supply chain. Payment performance on larger contracts is now subject to spot checks and published data.
None of this makes winning easy. It does mean the door is open in a way it wasn’t five years ago.
Consortium Bidding
What it is
Two or more organisations bid together as a combined entity, competing for a contract that none could meet the requirements for individually. The consortium pools turnover, capability, geography, and experience into a single offer.
Consortium bids are legitimate, common, and expected. Commissioners aren’t suspicious of them. What they’re suspicious of is a consortium that hasn’t thought through who’s accountable for what.
The two structures
Lead bidder / prime contractor. One organisation holds the contract with the commissioner and carries full legal responsibility for delivery. The others deliver defined elements under separate subcontracts with the lead. The commissioner has one contract, one point of accountability, one invoice.
This is by far the most common arrangement, and the simplest to explain in a tender. It also means the lead accepts liability for everyone’s performance, which concentrates risk uncomfortably. Lead only if you can bear it.
Special purpose vehicle (SPV) or joint venture. The consortium creates a new legal entity, which contracts with the commissioner. Members contribute to and govern the SPV under a joint venture agreement.
Cleaner in theory, considerably more work in practice: new company, new governance, new registrations. Reserve this for long-term, high-value arrangements where the setup cost is justified.
What commissioners assess
Read the selection questionnaire carefully before you commit to a structure, because the requirements vary and the details matter.
Financial standing may be assessed on the lead alone, or on members individually. If the lead must meet a turnover threshold in its own right, a consortium of three £700,000 providers doesn’t solve your problem. Check first.
Experience is usually more forgiving. Where a newly formed consortium can’t provide contract examples in its own name, authorities should accept examples from the members who will actually deliver the service. That’s the point of consorting.
Crucially, consortium arrangements must be in place at the tender deadline, with all members and subcontractors declared. Change the membership afterwards and you must notify the authority, explaining what changed and why. Fail to, and your tender may be disregarded entirely.
Exclusion grounds also apply across the consortium. Under the Act’s debarment provisions, one member’s history can jeopardise everyone’s bid. Due diligence on your partners is not optional.
The agreement you must have
Before you write a word of the bid, agree in writing:
- Who leads, and who signs the contract
- How work is divided, by service, by geography, by client group
- How money flows, including payment terms between members
- Who holds which liabilities, and what insurance sits where
- How decisions are made, and how disputes are resolved
- What happens if a member withdraws, before award and after
- How TUPE obligations are shared, if the contract involves transferring staff
A consortium bidding agreement isn’t bureaucracy. It’s the document that keeps a promising partnership from collapsing in month four when the referrals arrive unevenly.
A word on competition law
Two organisations that could each deliver the contract alone, agreeing to bid together, may be acting anti-competitively. Consortiums are lawful precisely because they enable bids that couldn’t otherwise happen. Share only the information necessary to deliver the service, and take legal advice if you and your partner are genuine competitors of comparable capability.
Subcontracting
What it is
A prime contractor wins the contract and holds it. You deliver a defined element under a separate agreement with them. You have no contract with the commissioner.
Providers often treat subcontracting as second best. That’s a mistake, and an expensive one.
Why it’s the smartest route for many providers
It’s how you build the evidence you’re missing. The reason you can’t bid as prime is usually a shortage of matched contract examples. Every subcontract you deliver becomes exactly that: a public sector delivery reference, with a named commissioner-facing prime who can vouch for you.
It’s contracted revenue with protected payment terms. Those 30-day terms now flow through the supply chain, backed by published payment data on larger contracts.
It carries none of the prime’s exposure. You’re accountable for your element. The prime carries the contract risk, the mobilisation obligations, and the commissioner relationship.
It’s the recognised path to prime. Providers who subcontract deliberately, choosing work in the sectors and at the scales they eventually want to bid for directly, accumulate the case studies that make prime bids credible. Three years of that discipline transforms a selection questionnaire from an obstacle into a formality.
How to find subcontracting work
Subcontracting opportunities are rarely advertised. Finding them is a business development exercise, not a bidding one.
Use award notices on Find a Tender and Contracts Finder to identify who currently holds the contracts you’d like a share of. Those are the primes who will need specialist partners at the next re-procurement, or sooner, if their coverage or capability has gaps.
Approach them before the tender lands, not after. A prime assembling a bid in week two of a six-week window has no time to onboard an unknown partner. One approached six months earlier has time to build you into the delivery model.
Get your compliance house in order first. Policies, insurance, CQC registration and rating, safeguarding, DBS processes. A prime’s first question is whether you’ll survive their due diligence.
Under the Act, prime contractors on qualifying contracts must disclose intended subcontracting arrangements, and in many cases advertise subcontracting opportunities. Watch for both.
Which Route, and When
Subcontract when you lack the evidence, financial standing, or scale to bid as prime, and when the priority is building a track record. This is most small providers, most of the time.
Consort when you and your partners collectively meet the requirements, the contract genuinely requires complementary capabilities or geography, and you have the governance maturity to make a shared arrangement work. Consortium bidding rewards preparation and punishes improvisation.
Bid as prime when your evidence base, financial standing, and operational capacity honestly support it. Not before. A prime bid you can’t substantiate wastes weeks and teaches the commissioner something you’d rather they didn’t learn.
And whichever route you take, qualify the opportunity properly before you commit. Whether a contract genuinely fits your profile, and where your gaps sit against its requirements, is precisely what the Bid Health Score and Profile Gap Analysis in the BIDsuite platform are designed to reveal, before you’ve spent a month of your registered manager’s time finding out the hard way.
Small Doesn’t Mean Shut Out
The contracts that look out of reach usually are, on your own.
But procurement rules now actively favour SME participation, commissioners are under pressure to award more work to smaller and local providers, and the routes in, dynamic markets, consortium bids, subcontracts, exist precisely because the sector needs providers like you delivering the work.
What it takes is a different question at the outset. Not “can we meet these requirements?” but “who could we meet them with?”
Our team supports providers across supported living, domiciliary care and children’s services through exactly these routes, and our case studies show what happens when a small provider stops bidding alone and starts bidding strategically.
The turnover threshold that closed the document isn’t a verdict on your service. It’s an invitation to find a partner.
Need support with tenders or compliance? AssuredBID helps UK social care providers prepare stronger bids and win the right opportunities.
You can book a consultation with our tender experts, explore our services, and follow AssuredBID on social media for practical updates, insights, and guidance you can actually use.
You can also explore the BIDsuite platform to find the right tenders and check your chances of winning.
