There’s no denying that the tender market in Australia presents significant opportunities to secure new business and grow operations. But in an industry that is fiercely competitive, many businesses find succeeding through the tender process extremely difficult.
For many, the thought of responding to a tender conjures images of late nights, anxiety and last minute dashes to the tender box. The ‘lucky’ few achieve regular success through tenders, winning major contracts in their field. But what is it about their tenders that win them one contract after another?
When responding to a tender there are three areas that your tender needs to clearly demonstrate to the buyer to be successful:
- Compliance with the specifications and conditions of the tender;
- Value for money and benefits of their solution to the buyer; and
- How their proposal eliminates risk to the buyer.
Stage 1:
The first stage of tender evaluation is to eliminate any tenders that do not comply with the mandatory requirements. These might include the specifications of the goods or services, acceptance of the contract conditions, or even the format in which the tender is presented.
Evaluators often use this early stage of evaluation to reduce the overall number of tender responses they will need to read in detail. Even minor discrepancies that seem irrelevant may cause a tender to be eliminated before it is fully evaluated.
Complying with the conditions of the tender and the requested format demonstrates attention to detail and that you are flexible to the buyer’s needs. Make sure you complete every question and request for information in the document, even if you don’t have a complete answer at the time. The evaluation panel is more likely to request clarification than to accept an incomplete tender document.
Follow all instructions given in the tender for preparation and submission of your response regardless of how trivial they seem. Even something as minor as the font in which the tender is written could have your response eliminated without further consideration.
Have someone not involved in the preparation of the tender review your final response against the original request for tender documents to double check that it is compliant with the requirements.
[Next: Stage 2 of the tendering process]
Stage 2:
In the case of any government body in Australia, the overriding criteria for evaluation must be ‘value for money’ as outlined in the Commonwealth Procurement Guidelines. The best approach is to highlight as many benefits of your organisation and solution as possible in a range of different areas:
- Experience;
- Quality control measures and processes;
- Technical capabilities and qualifications;
- Cost savings;
- Ongoing support;
- Financial and corporate stability;
- Innovation, research and development; etc.
Try to imagine yourself in the place of the buyer, evaluating a series of tender responses and trying to determine which one offers the most value. If each of the tenders simply reflects the exact specifications in the request for tender with no additional value, the only factor that remains to make a decision from is price.
Before you begin to write your tender response, make a list of what the buyer’s motivations are, as well as the pro’s and con’s of your solution (and that of your main competitor’s if you know them). Use this as a guide as you prepare your tender, referring to it for inspiration as you respond.
For every statement you make ask yourself, “So what?” This will help ensure that all information is relevant and that you have clearly identified the benefits rather than leaving it to the reader to determine how your proposal will benefit them.
[Next: Stage 3 of the tendering process]
Stage 3:
When responding to a tender, establishing why the buyer should select you is only half of the challenge. It is also important to eliminate any reasons why they might choose not to select you. A buyer may like your proposal but if it presents high risks they may settle for a safer option.
To be able to eliminate risks you must first identify what they are and the impact they will cause the buyer. Some common risks include:
- New business – an organisation who hasn’t been in business long may be considered ‘fly by night’ or to be lacking in experience to be appointed to a contract;
- New to the government sector (or other industry sector) – Buyers believe that their needs are unique and like to see that you have previously worked with clients or similar size and nature in the past;
- Financial capability for capital investment and cash flow throughout the contract. Poor cash flow may result in interruptions to the supply of raw materials and services to your business which will impact your ability to perform the contracted works; and
- Compliance with government regulations including Occupational Health and Safety, Industry Licensing requirements, workplace relations and employment policies.
By identifying the risks associated with your business, whether real or just perceived, you can provide further supporting evidence to ease the mind of the evaluators, such as client references, letters of support from associated organisations, insurances, work procedures and company policies.
Finally…
The tender market is teeming with buyers looking to partner with suppliers for security services and related products. Select tenders that align with your businesses niche in the market and tailor your response to suit their needs and you will be able to achieve success in the tender market.
Focus on selecting the right tenders to bid for and treat each tender as a unique proposal rather than rehashing the same response each time; ensure that you have clearly covered the three main areas of the response outlined above; and before you know it, you will be building new business through tenders.
Fabian Kempter is the General Manager of TenderSearch.
For more handy tips on tendering, check out The TenderSearch Guide to Tendering or visit www.tendersearch.com.au
