You’ll often see a tender opportunity that on the surface looks really interesting, but writing tenders is incredibly time consuming and expensive so it’s vital that you are selective and only bid for business that:
- You’ve got a good chance of winning
- That fits with your core business and that you have a proven track record of supplying
- That is likely to be profitable
When making bid decisions, here’s what you need to consider when you’re looking at an OJEU notice or client’s tender & specification:
- Check the Mandatory Criteria. Do you meet the client’s specified minimum standards in terms of turnover, finance/credit, insurances, experience, references/case studes/testimonials, professional memberships etc? If you don’t then you will be deselected!
- Knowledge of the Client. Are you already working with the client? Is there some history with the client / contacts? What do you know about their business? You’re more likely to be able to write really clear and relevant responses if you’ve got some knowledge of the client’s company or contacts.
- Relevant Experience. Have you got a track record of supplying this type of service to multiple clients (ideally at least 3). This is a major consideration as it is very risky for a buyer to progress with a supplier who can’t demonstrate a really solid record of supplying similar contracts (consider size, geography, nature of supply, sectors/disciplines etc).
- Contract Value. A general rule of thumb is that a buyer is unlikely to consider a supplier with an annual turnover is less than 4 x the annual value of the contract.
- Value of the Business to You! How much is the contract worth to you? It may be worth £1m, but if only £20k is in your sector is it worth bidding? Crunch the numbers and make sure it’s worth the time and effort required. Also is the client looking for a Vendor Neutral or Master Vendor provider? Is it a sole supply agreement, PSL or a framework agreement. Establish how much potential business there is for you and how much work you’ll have to do post contract award to get it.
- Lotting Strategy. How is the tender split down? Is it split into lots (i.e. can you bid for one bit without bidding for the whole lot?). Is it split into sectors/specialisms, geographically etc.
- Risk! The buyer’s job is all about risk mitigation, but what about your risks? How will winning this contract affect your business, margins, ability to supply other clients etc? Will your existing insurances cover this contract? Get your insurers to review the T&C as you may well not be covered!
Tendering is a great way to win business and increase the value of your company…..but be selective! If you need more advice on how to find and select the right tenders, then why not give Fiona a shout on 07944 856293, email firstname.lastname@example.org or register to receive our latest news and “How To” documents for free!