Phase 1: Enabling procurement of bio-based products and services

What is important in this phase is the mapping of existing procurement and other related instruments in order to assess how they can be used to enable bio-based products and services during the later procurement procedures.

The boxes below highlight the most relevant instruments for this phase and show how relevant they are to foster the procurement of bio-based products and services.

Procurement Policy and Agenda

Brief explanation:

Procurement policy or a procurement agenda (or plan) describes the procurement needs that have priority for the foreseeable future. The agenda helps you identify internal obstacles that the organisation cannot yet solve for itself. The agenda shows external market parties such as suppliers the new concepts, products and services that could be needed in the future. It is an open invitation to participate in the innovation process. A procurement agenda must always be representative of the mission, vision and goals of an organisation.

In the procurement policy and agenda clear targets and future needs with regard to bio-based procurements can be addressed. Added value of bio-based procurement compared to traditional solutions are e.g. regional value (forestry and agricultural), economic value, CO2 and other greenhouse gas emission reduction potential, resource saving and waste prevention. A procurement plan will give procurers the necessary (political) backing to ask for bio-based products and services in procurements. It gives suppliers time to anticipate and adapt their products accordingly.

More information:

Procurement policy and agenda

Trial phase

Brief explanation:

A trial phase is a demonstration used for testing innovative solutions for your organisation. A trial phase could be at a physical location, such as a street or building, but it could also be within a laboratory or a digital environment. As the contracting authority, your organisation should decide the requirements that the tenderers for the solutions must observe.

A trial phase is useful where a demonstration is the only way to see if a solution actually works. This may be the case if the real-life situation is so complex that it cannot be replicated in laboratory conditions. A trial phase gives your suppliers the opportunity to prove the effectiveness of their innovations in a real-life situation. This can convince you, as contracting authority, of the effectiveness of a solution.

Trial phases are very important for bio-based and other innovative products, because new products need to establish a track record.

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Trial phases

Financing strategy

Brief explanation:

A financing strategy helps you decide on the best opportunities and instruments to deploy for an innovation project and what risks you are willing to take in this regard. This instrument is useful if you are trying to identify how you want or are able to finance innovation procurement. Based on the budget available for such a purchase, you choose from existing financing options and instruments. It may be that you yourself invest in the innovation – solely or with others. Or it may be that you expect other parties to be willing to invest in the project. Or there is no budget, or the available budget is insufficient.

Financing strategy is related to the price of the product and services and not to the specific product in question. As long as the procurement of bio-based products/services does not constitute relatively higher additional costs for the procurers the decision on the financing strategy applicable has a rather lower importance.

More information:

Financing strategy

Risk Management

Brief explanation:

The aim of risk management is to manage all potential risks involved in public innovation procurement. It helps you to quantify and monitor risks and to take measures to prevent negative consequences. One method of conducting risk management that is frequently used is by drawing up and keeping up-to-date a ‘risk register’.

Public innovation procurement involves various risks, especially if there is to be a tendering process. There are risks attached, for example, to technical, commercial, contractual and performance-related issues. The risks involved in the procurement of innovative products and services are greater, because innovation is often associated with trial and error, and by definition it comes with a greater risk of failure. Risk management helps you to manage these risks and reduce the chance of failure.

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Risk Management

Intellectual Property Rights (IPR)

Brief explanation:

IPR refers to the creation of the mind such as inventions, literally and artistic works, design and symbols, names and images used in commerce. Outcomes of new technical solutions and innovative knowledge can be protected by IPR (e.g. copyrights and neighbouring rights, patents, trade secrets incl. know-how, design related rights). The parties of the public procurement contract shall define by the beginning of the procedure who will own and commercially exploit of IPR.

IPR are typically the matter of concern when procuring innovative products. When it comes to the agreement between the parties the most important issue is to govern the allocation (by licensing and royalties) or the shared ownership of these rights. This issues have no specific implications in terms of the application of bio-based products and services.

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