New guide: Understanding the performance of a procurement market with indicators
In 2019, the public procurement agency Colombia Compra Eficiente (CCE) started tracking competition in each procuring entity, calculating the average number of bidders per tender, and making the results publicly available. The objective of this initiative was to encourage public agencies to improve competition and help suppliers identify the most competitive markets, which could then result in lower prices.
This simple metric (the average number of bidders) is one of the key indicators that you can use to understand the performance of a procurement market. We’ve developed a guide to calculate this and other key indicators that provide relevant information on different aspects of the contracting process, based on academic research and international best practice. The guidance includes metrics related to competition, efficiency and supplier performance, describes what data fields are needed (mapped to the Open Contracting Data Standard) and explains how to calculate them.
What’s included?
Before you start calculating the indicators, we recommend running a couple of metrics to identify the scope of the data. You can check:
- The number of contracting procedures and procuring entities covered.
- The stages of the process. Do you only have tender or award data?
- The time period covered.
- The categories published (works, goods, or services).
- If item classifications are available.
The answers to those questions can help you frame your analysis and give context to your results. For instance, if most of the contracting procedures are published by a particular agency, the findings about the top suppliers, will relate to this institution and will not give an overview of the whole procurement market. You can also check our blog on tips to analyze OCDS data.
The table below details the indicators included in the guide:
| Topic | Indicators |
| Competition | Proportion of open tenders Proportion of single bid tenders Proportion of value awarded in single bid tenders Average and median number of tenderers Market concentration Number of unique suppliers by item Number of unique suppliers by entity |
| Supplier performance | Top suppliers by value and number of awards Success rate of bidders Share of single bid contracts Share of direct awards |
| Efficiency | Average duration (in days) of the tendering period Average duration (in days) of the award period Proportion of cancelled tenders Proportion of contracts with savings and overruns |
In practice
These indicators can be used by procuring entities, civil society organizations, academia or journalists interested in analyzing procurement markets. We have seen examples of these metrics used by our partners in the field.
For instance, Moldova launched a portal that gives a general overview of all COVID-19 related tenders in the health sector, with information about the suppliers, goods, quantities, values and even unit prices. In Latin America, the journalism collective CLIP analyzed tenders in nine countries procuring respirators for Covid-19 patients. They compared prices, identified the main suppliers and the total value spent on these medical supplies. And our partners at TI Health created a dashboard to visualize procurement indicators in various countries.
We have also used these metrics to analyze competition in Colombia, understand the infrastructure contracting procedures of Argentina’s National Infrastructure Agency (Instituto Nacional de Vialidad) and compare metrics between countries.
OCP analysis for different countries
For inspiration, you can also check our full list of projects, platforms and portals of partners around the world that analyze and visualize open procurement data. Complementing these indicators is our guidance on Red Flags, which is useful for identifying suspicious behavior in public procurement.
Have you used these indicators in your analyses? Need help using open contracting data? We want to hear from you! You can write us to data@open-contracting.org.
