Should you be interested in the competitive tendering process?
If you went into business looking for excitement, then taking part in a competitive tendering process probably wasn’t top of your list when it came to the peak experiences you might have imagined. Not only does it not sound very interesting (and to be frank, it isn’t), but you’ve also probably heard that it involves late nights writing the equivalent of a small novel, answering questions to which you don’t have answers, while you continue to try and run your business suffering from over-caffeinated sleep deprivation.
The good news is, it needn’t be that bad (or uninteresting), and help is at hand.
If you want to seriously grow your business with sizeable, prestigious clients, then the competitive tendering process is becoming one of the few gateways to a whole new world of achievement, success and yes, excitement (being crowned bid winner on a large contract, with no second place for your rivals, is hard to beat when it comes to business milestones). Choose not to enter that world, and you may well be denied its riches.
SMEs are becoming increasingly aware of the competitive tendering process. Lots of us are brilliant at what we do, but understandably not yet brilliant at navigating the techniques and intricacies of tendering. We’re not always sure which opportunities to go for, and when we do, the tender process feels alien, confusing and frustrating. Then, if we lose (which often happens with the first few tenders we embark upon alone), we’re not sure why, and we become disheartened. But help is at hand from East Sussex based McCrudden Training.
One company had tendered for fifty contracts and not won a single one, when they finally called in professional help. “Morale was at rock bottom. One of the first things we identified when we undertook a win-rate analysis for them was that they were simply bidding for the wrong contracts. When they began to evaluate opportunities more critically, they started getting their first wins” says McCrudden Training’s Pitch Perfect tutor, Paul Sharville.
For SMEs new to the competitive tendering process, knowing what it is would be a helpful start. So, let McCrudden Training help with a bit of demystifying.
Competitive tendering is the formal process by which an invited group of competing organisations submit a tender (aka bid, proposal or submission) to a prospective client in order to secure a project or contract. The process differs from simply submitting a quote in several ways.
First, it’s the prospective client who decides what you submit; you can’t just hand them that polished sales pitch: the one usually has clients reaching enthusiastically for their purchase order pad (in fact, you’ll often be asked not to include sales material). You will be asked to submit your proposal in a specific format, and to answer a wide range of very detailed questions, covering everything from your approach to the work, to your approach to the environment.
Second, you’ll be marked against specific evaluation criteria. Your brand new website and company brochure will have little to no effect on the decision, as lovely as they no doubt are, nor will delivering your bid with a bottle of single malt whiskey labelled ‘for the procurement manager’. The latter is likely to get you removed from the process. It all comes down to the quality of information in your bid and how well you respond to the questions asked.
If you’re the incumbent (ie you already hold the contract), then you can draw, to some extent, on your glories as a model service provider with an unblemished record of going the extra mile, and this may count in your favour. Conversely, I’ve known existing providers – good ones – lose a contract by just a few marks. The European tendering model used by some large organisations can be particularly brutal.
Third, and here’s the good part, when you take part in a tendering opportunity, you’ll almost always be bidding for a large project or contract. They’re worth going for because they’re usually worth winning. For the client, it’s one of the primary reasons that the process exists. They will be spending a great deal of money on buying a project or contract service that is very important to them. Competitive tendering, done well – and all its many hoops through which you’ll be expected to jump – will usually find the best provider. Winning a tender opportunity is not only good for your business, it’s a validation of your people and processes, your culture and the way you work. There is well-deserved pride as well as profit for successful bidders.
For SMEs, tendering for new business can be tough, but the rewards are great. A big win can launch your organisation into the next stage of its growth. It can provide security of cashflow and employment, and you can then use your new-found ‘King of the Hill’ (or Queen) status to bid for similar projects.
More and more, the tendering process is the only way to secure large projects and contracts. If you want to secure sizeable work in the public sector, then without a doubt you will have to gear your business up for competitive tendering. Councils vary in their thresholds, but if you want their work, at some point you’ll find yourself receiving a Pre-Qualification Questionnaire (PQQ) or Invitation To Tender (ITT); the start of the tendering process.
Some local authorities will accept a single quotation for goods, services or works under £5k. Between £5k and £50k (£100k for works), three suppliers will be asked to provide a quotation. Over £50k, goods and services will only be offered through the competitive tendering process. Other authorities will have lower tendering thresholds of around £25k. Most Councils claim to encourage SMEs to bid for work, and most prefer to source their goods and services locally. (What are you waiting for?)
If you’re at the smaller end of the SME spectrum, those threshold figures may be higher than any single project or contract you could, or would, want to handle, so maybe you don’t need to turn that spare room into a bid management operations centre just yet. But consider this: smaller tender opportunities do exist for the smaller organisation, and furthermore, many of the processes, policies and documents that you’ll be required to put in place for tendering are also excellent pieces of company information for impressing any client. When a tender asks for your statement on corporate and social responsibility (CSR), as they always do, once you’ve made some formal commitments to CSR, and written it into your company’s library of great things you do, you’ll find yourself using it over and over again when pitching for work, inside or outside the competitive tendering process. Good tender content, as a rule, is good content for marketing your business anywhere.
On 7 March 2012 professional bid writer Paul Sharville from BidWrite® will join McCrudden Training’s FREE Network and Learn event in Eastbourne. It’ll be a stimulating insight into what the competitive tendering process is, and how you can find opportunities. And of course, there’s a chance to network and socialise with other East Sussex business people.
On the 29th March, McCrudden Training will be running a full-day workshopPitch Perfect in Eastbourne. We’ll guide you through finding and evaluating tender opportunities, building a bid team, achieving a high win rate, and writing compelling proposals.