HS2 SUPPLIER GUIDE

www.hs2.org.uk

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:

AboUT THIS GUIDE

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.

What will we be buying?

When will we be buying?

Where can you access HS2 opportunities?

How will we engage with you?

What do we want from the supply chain?

What can you do now?

What is HS2?4

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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.

InTRoDUCTIon

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

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 2026.

Phase Two services are expected to start running to Manchester and Leeds in 2033.

Phase One

WHAT IS HS2?

oUR vISIon

oUR MISSION

is to work together with stakeholders to maximise the value that HS2 delivers.

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.

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

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:

yy created across many business sectors, requiring a wide range of capabilities;

yy suitable for suppliers of all sizes; and

yy generated 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.

WHAT WILL WE bE bUyInG?

SURFACE RoUTE

Includes elements such as earthworks, drainage, cuttings

and embankments, bridges, viaducts and

other structures.

£3.8bn

CATEGoRIES

TUnnELS RAILWAy SYSTEMS

DESIGn & SERvICES

Relates to the sub-surface sections of the route, including tunnels,

portals and shafts.

Includes permanent way, overhead line

electrification, signalling,

telecommunications, traction power and

electrical distribution.

This relates to design and other

professional services.

RoLLInG SToCK

£3bn

Euston

old oak Common

birmingham Interchange

Curzon Street

STATIonS

£2.9bn £1.7 bn

£7.5 bn

Enabling and Advance Works – costs are included within the figures provided and not identified separately.

Price includes rolling stock for Phase one

and Phase Two.

£0.4 bn

Certain elements, such as Euston station development and some elements of railway systems, are excluded from the above categories. Figures above are 2011 prices.

60%

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.

WHAT WILL WE bE bUyInG?

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.

We expect 60% of contract opportunities arising in the supply chain to be awarded to small and

medium-sized enterprises.

WHAT WILL WE bE bUyInG?

HS2 Ltd

TIER 1 Main contractor

Joint venture

TIER 2Subcontractor

Supplier

TIER 3Subcontractor

Supplier

TIER 4 and 5Subcontractor

Supplier

HS2 DIRECT oPPoRTUnITIES

HS2 INDIRECT oPPoRTUnITIES

10s

10,000s

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 2026. However, many of the major works packages in each category will be procured between 2015 and 2019.

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.

WHEn WILL WE bE bUyInG?

2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026

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 12-15 months prior to start of construction.

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.

WHERE CAn yoU ACCESS HS2 oPPoRTUnITIES?

opportunity source Where to look

Above oJEU thresholds*

below oJEU thresholds*

HS2 – Direct

Tender Events Daily http://ted.europa.eu Contracts Finder www.gov.uk/contracts-finder HS2 Website www.hs2.org.uk/business

Supply Chain – Indirect

CompeteFor www.competefor.com

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 https://ccs.cabinetoffice.gov.uk

* Current EU thresholds can be found at www.ojec.com/thresholds.aspx

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: https://hs2.bravosolution.co.uk

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 www.competefor.com and either register, or review your existing company profile and the categories to which you supply.

HoW WILL WE EnGAGE WITH yoU?

CATEGoRy InDUSTRy

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.

MARkET SoUnDInGS

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.

REGIonAL RoADSHoWS

‘MEET THE ConTRACToR’

DAyS

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 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 (www.hs2.org.uk/news-resources/events) to your favourites and check back regularly to find out about forthcoming events. Email us at SCC@hs2.org.uk to tell us about your areas of interest, so we can keep you updated.

Skills and employment

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.

WHAT Do WE WAnT FROM THE SUPPLY CHAIN?

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

Environment

benchmark for delivery and operational

excellence

vibrant city regions

Design for passengers

on time on budget

oUR bALAnCED SCoRECARD

Environmental aims

Economic aims

Social aims

Environmentbenchmark for delivery

and operational excellence

vibrant city

regions

Design for

passengers

Skills and employment

on time

on budget

Health, safety

and security

Incentives Collaboration Innovation

HS2 vISIon

Integration Risk ownership Transparency

Standard set of KPI measures

benchmarks for design and delivery established

within contracts

STRATEGIC GoALS

VALUE FOR MONEY

EnAbLERS

CRITICAL SUCCESS FACToRS

PERFORMANCE

our balanced Scorecard combines:

Modern methods of construction

Access our supply chain resources

visit the business section of the HS2 website to review and download

key information about the project. www.hs2.org.uk/business

WHAT CAn yoU Do noW?

1 2 3Register to join our prospective

supply chain communityEmail 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.

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