The realities of being preferred: Specialist subcontractor perspectives on restricted tender list membership

Given the extent of subcontracting in the UK construction industry, establishing new and more effective procurement routes is of prime importance for the efficiency of the industry. In recent years many new procurement initiatives have been developed which have gradually moved the industry away from competitive tendering as the primary selection mechanism. However, despite the increasing prevalence of negotiated contracts, framework agreements, partnering arrangements, alliances and preferred contractor schemes, little empirical research has been undertaken to explore subcontractor perspectives of working under these schemes and how they are likely to impact on future supply chain relationships. This paper presents the findings of research which investigated the views of a range of large specialist sub-contractors who were all members of a preferred contractor list operated by a leading main contractor. Whilst the scheme was shown to have some tangible benefits to main contractor/subcontractor relations, the findings suggest that the rhetoric of "partnership" embodied by the preferred list approach masks a harsher reality of main contractor opportunism, in which responsibility is downloaded and risk offset to the specialist firms. It is posited that the benefits of preferred schemes will not be realised until main contractors embrace the notion of achieving best value through truly collaborative subcontract procurement practices rather than lowest price.