Competitive Tendering – How to Stay Ahead of Your Competition
Last updated: April 19 @ 10:45 am
Competitive tendering can be daunting. The procurement world is more diverse than ever before, and it has never been more important to stand out from the competition. This is far easier said than done. At Hudson, we draw upon our wealth of experience and our 87% success rate to help our clients to succeed. Today we are looking at the ways to make your bids stand out from your competition. The following points are endorsed by our Bid Team and are applicable across all sectors to set you apart from the competition.
Table of Contents
In a nutshell, competitive tendering is where potential suppliers bid against each other to win contracts. You will most commonly find these tenders within the public sector. The purpose of this tendering process is to find the best goods/services and value for money.
The intention of competitive tendering is:
We all know it but struggle to implement it. The more time you have to work on your bid, the higher the quality of the content.
Opportunity tracking is incredibly beneficial for forward planning. It will enable you to factor tender deadlines into your (and your team’s) workload. Know what you are capable of delivering and plan when a pertinent tender arises. This way, you can spend more time planning and curating your tender response which will enhance its quality.
This first point gives way to the following points. Planning ahead, will give yourself time to undergo all of the invaluable steps for success in the competitive tendering world.
As part of any standard Pre-Qualification Questionnaire (PQQ) or Standard Selection Questionnaire (SQ), you’ll be asked for three case studies. You should choose references that are relevant to the tender requirements, for example:
Otherwise, consider what transferrable tasks/challenges/successes you have seen in other contracts which will help you deliver this one well.
Ensure that the point of contact is someone who can vouch for you. This includes the services and successes you say you have delivered. This is all the more important in the public sphere. Corroborative, relevant references will emphasise your credibility in the competitive tendering domain.
Standard PQQs or SQs include a section for those who can’t demonstrate three examples of their capability to deliver the specified services. If necessary, use this box to explain your competence. However, always include three contract examples where possible as this is the most advantageous approach.
Know what you are bidding for. A specification of requirements is nearly always included in the Invitation to Tender (ITT) documentation. High calibre responses will incorporate elements and information from this document. This is only possible once you have read through it with a fine-toothed comb.
Buyers want to ascertain that potential suppliers can provide the exact services for which they have asked. The quality response is your chance to demonstrate your ability and relate your answers to their specification. This is your opportunity to affirm that you can deliver the required services.
If there is a presentation stage during the tendering process, extensive knowledge of the specification will be invaluable. Meeting the buyers face-to-face will test your understanding of the requirements and you want to be familiar with the details.
Sounds simple, right? Wrong. It is surprising how easy it can be to veer off on a tangent. Before you know it, a question about your company’s website can turn into describing your risk assessment methodology. The question has been asked for a reason, so ensure that you respond relevantly and appropriately.
When planning a tender response, read the question and read it again. What is it asking for? Most questions will specify certain topics to cover in the response. Take advantage of these guidance points and create subheadings from them. Subheadings are an evaluator’s best friend. Think of how many tender responses they will be reading. Pages of disorganised text are far from ideal. Create subheadings and write relevant content under each one.
Not only does this strategy ensure the question is fully answered, but it also facilitates the evaluation process. Content is signposted and easily located, rendering your responses more buyer-friendly overall. Quality responses on average comprise 40% of the tender submission weighting. It is important, therefore, to excel in this section if you want to succeed in competitive tendering.
Present relevant information for the convenience of the buyer. If you mention the proposed Contract Manager, name them. If describing an electronic management system, name it. Fill in the blanks for the buyer and spell out what you mean. Specificity suggests that you are both credible and accountable and makes your delivery proposals concrete and realistic.
When tendering competitively, always give evidence to reinforce your points in your tender responses. It would be advisable to follow the below process when making assertions in responses:
Referencing other contracts on which you have completed identical or similar services is advantageous. This shows that you are experienced at what you do and gives the buyer confidence that you are competent.
Substantiation is especially important for questions regarding supply chain or subcontractor management. Buyers want to see evidence (such as policies) that suppliers retain accountability for their supply chain/subcontractors’ practices. This can range from the effectiveness of environmental and quality management systems to the elimination of modern slavery.
Evidencing your competency within word limits is ideal, but often it is valuable to attach appendices. Be careful, as some tenders state explicitly that appendices will not be evaluated. If this is not the case, think about policies/licences/accreditations. These can further support the content in your response and showcase your ability.
Nowadays, it is very likely that you will encounter at least one question about social value or community benefits. Increasing numbers of companies have implemented Corporate Social Responsibility (CSR) or Social Value Policies to support their business activities. Social value questions appear most often in tenders which have been written by councils and are about your company’s commitments.
Social value can be broken down into three categories: economic, environmental, and social. Below are examples of social value commitments for each category which buyers often look for. These are worth researching and implementing in your business practices. It will aid in helping you to stand out in the competitive tendering domain.
Commitments could include:
Commitments could include:
Commitments could include:
By mentioning commitments, you show that you have considered how to create a positive impact on the wider community. Thinking about specific commitments beforehand is incredibly favourable for the tender process.
Creativity spans both content and presentation. If you have an innovative idea that will save time or money, describe it. You are the experts in your field; now is the opportunity to showcase this. Anything that will cut costs or add value to a contract is attractive to a buyer. Make sure you stay at the forefront of your industry’s best practice, both existing and emerging – this requires time and effort but will ensure that you have the edge on your competitors.
Often, a pre-formatted response document will form part of the tender documentation. This is a case of pasting your responses into the document. Other times, a free-flowing proposal is required. Be creative! Don’t submit your responses in Calibri font on a blank document. Engage the services of your in-house Designer or outsource the work. Impress the buyer by grabbing their attention and presenting the content in a professional, brand-specific manner.
This requires planning ahead as content will need to be signed off prior to design work. The results are well worth it and will ultimately add value to your competitive tendering efforts.
Unfortunately, there is no simple answer to this question. As always, in competitive tendering, things are not so straightforward, and no one approach fits all sizes!
Pricing in competitive tendering is the buyer’s assessment of the quotation or schedule of rates you offer to deliver the required goods and services. This will usually take the form of one of the following:
As you can imagine, purchasing organisations do not want to pay more than they have to for goods and services. Hence, price is a key factor that puts the “competitive” element in tendering. This will doubtlessly form a key part of the buyer’s assessment of prospective suppliers in most scenarios. Buyers want to make sure they are getting the absolute best value for money.
Along with technical and quality aspects, price is a key factor. It is allowing buyers to make an assessment of which supplier offers the MEAT – the most economically advantageous tender. Indeed, this is, for all intents and purposes, the point in the competitive tendering process in the first instance. To afford buyers the chance to make a comprehensive assessment of the supplier/suppliers who will bring the best value for money to their organisation.
As you might already have guessed, there is no simple answer to this question. In the world of competitive tendering, every buyer has the right to make their own assessment of price. Each is constrained by different regulations. However, typically the lowest-priced tender will score the most points for the price aspect of a bid. However, in tenders such as an RFQ, the buyer may simply choose to award the contract to the supplier with the lowest quotation, outright. Where the assessment isn’t made on price alone, buyers typically award 100% of the available marks to the lowest-priced tenderer. They then award a proportional percentage to the other prospective suppliers which decrease as their price increases.
Example:
Tenderer A Price: £50,000
Tenderer B Price: £55,000 (10% higher than the lowest tender).
Tenderer C Price: £60,000 (20% higher than the lowest tender).
Tenderer A proportion of available price marks: 100%.
Tenderer B proportion of available price marks: 90% (10% higher than the lowest tender).
Tenderer C proportion of available price marks: 80% (20% higher than the lowest tender).
It is worth bearing in mind that the above example is a rough guide only designed to illustrate the point. They show how marks awarded for price will decrease proportionally based on how far above the lowest price each supplier quotes. Indeed, buyers will have their own algorithms, matrices and scoring systems. These will be in place to work out how much to award each supplier depending on their price.
In competitive tendering, the quality aspect of a bid involves the past experience and technical and professional ability of suppliers. It typically involves core competency questions. Suppliers have to answer along with a demonstration of relevant past experience, team skills and qualifications, and scenario-based questions. The quality element of the competitive tendering process comes in many forms. Either buyers might ask prospective suppliers to fill in responses to a pre-developed list of questions or write a proposal for their delivery from scratch.
It is important to note that whilst price is significant, buyers do not just want the cheapest supplier. As we all know, cheap does not necessarily mean effective. And it is especially important in the public sector that public money spent on goods and services is spent effectively. Hence, buyers deploy a quality assessment as part of the competitive tendering process. This is to deduce the most competent suppliers with the most relevant skills, experience, and qualifications.
Much like with the pricing element. Whilst there is no one set criterion for evaluation, marks are typically awarded proportionally. They are based on the quality score of the highest-scoring tenderer in this aspect of the assessment.
Example:
Let’s say we have tender A, tender B and tender C, whose scored quality marks were:
(These initial scores themselves are usually the averages of three evaluators).
In this scenario, company C, with 85.33 is given 100% of the marks in this aspect. So, in order to work out the proportionate percentile scores for the other companies, we work them out as a percentage of the highest-ranking bidder. So:
It is worth noting that sometimes the price is not assessed at all. A buyer might opt for the tenderer with the highest quality score based on their responses to the buyer’s questions/the supplier’s own proposal – simple.
Proofread your final submission. Grammatical errors, spelling mistakes and missing words all point to a lack of attention to detail. At this point in the process, your submission will be ready before the deadline. PQQ completed, quality questions answered, and design work completed. Don’t fall at the last hurdle and miss small mistakes – have someone else read it too. A second or third pair of eyes can spot mistakes more easily. If in doubt, proofread it again.
Check that all relevant documents have been appended if required. Often, a PQQ or SQ asks potential suppliers to attach policies or accreditations. There are also frequently tender forms to complete – often only requiring a signature and date for compliance. Don’t get caught out – check that you have attached and completed everything the buyer has asked for.
Finally, check that all documents have been uploaded. You may have collated all the documents on your desktop, but have you uploaded them all onto the portal or attached them all in your submission email? Maintain your attention to detail up until the point of submission.
Consistently checking ensures that a high-quality response is submitted. If you want to stand out, your response needs to be as close to perfection as possible. No pressure then. But if the content reads well, is relevant and accurate and you have jumped through all the hoops throughout your response, you are in good stead. This is attainable through rigorous checking.
Don’t worry about distance: we live in a digital world!
This is an age-old debate here at Hudson Succeed. We’re constantly telling our customers to spread their wings and commence an international tendering strategy when it comes to bidding for new business.
Historically, we used to take as much business as we could from our doorstep. Local was, after all, deemed easier to deliver logistically and support with brand recognition. It was a major achievement to be a leading regional vendor.
But things have changed drastically over the years and the government throws hundreds of millions into helping us SMEs to trade internationally. The world and its major cities are so much more accessible and connected with daily direct flights from the UK to the US, Dubai, Australia, China etc. Especially for service and product-based enterprises.
We encourage our clients to eliminate any geographical fear when looking for business opportunities. We advise you to look at where the work is. Look at the logistics of delivery and if it deems possible then don’t put unnecessary barriers in place, hindering your company growth. An international business development strategy should be a core activity for your Executive/Director Team until you’ve established there isn’t any profit in trading overseas.
Here at Hudson Succeed, we have over 1,000 clients in over 30 countries – none of which we’ve met face to face. It’s not important to meet them in person. We speak with them, daily, over the telephone, Skype and email and we still deliver the same value-added service, regardless of if they’re UK-based, operate in the US or have their headquarters in India.
There are many advantages of competitive tendering that appeal to companies wishing to tender for a contract. Three benefits include:
What this means is, buyers can offer the contract to companies of any size. It means that the information issued throughout the bid process is available to all. There are no hidden costs or specifications, and the winning bid will be made public.
Another advantage of competitive tendering is that it encourages suppliers to focus on added value. Because bidders are competing against each other, they are more likely to offer services beyond the specifications. They need to add value to the overall proposal to increase their chances of success.
Relating to point three, another advantage of competitive tendering is that it can inspire innovation from suppliers. In order to stand out against competitors, companies may produce new technologies or schemes and present them to the buyer. Not only does this provide better solutions to the buyer, but it also contributes to overall business development. It could also be a good opportunity to see if the buyer is open to suggestions. Suppliers can offer better solutions at a better price, which could result in putting you ahead of other bidders.
Whilst there are many advantages of competitive tendering, you also need to consider the potential disadvantages. These could include:
Being forced to quote extremely low prices to be competitive can be frustrating for companies. They view the low cost as an insult to their services. In turn, this could affect the relationship they have with the buyer.
Because suppliers are competing against each other to win the bid, competing on price may not be enough. Therefore, many companies find themselves offering extra services with no extra cost. Whilst for the buyer this is an advantage, it can be detrimental to the supplier.
Whilst competitive tendering provides opportunities to everyone, this could also mean that the process becomes too competitive. Having to compete with so many suppliers could be off-putting and limit the number of prospective suppliers for the buyer. It could also mean that companies overcompensate with their price and service offering to be able to compete with others. This, long-term, could affect them drastically if they can’t follow through.
Read our ‘to bid or not to bid’ blog, providing you with additional points to consider when tendering.
In summary, it is important to look at the requirements of each opportunity as part of the competitive tendering process. Of course, if a tender is scored on a 100% price basis, but still includes a quality aspect, you probably won’t need to exhaust yourself by writing in-depth responses. Instead, your time, money and resources would be better spent in this case, ensuring your pricing is as competitive as possible to maximise your chances of winning the work.
Conversely, if a bid is assessed purely on the basis of quality, but still asks for a quotation for the works, it is more worthwhile spending time developing the most detailed quality responses/proposal possible rather than spending time analysing where to cut corners to make your pricing as low as possible. Having said that, even if the price is not considered in the scoring methodology and there are still quality questions, and vice versa, it is important to not completely disregard the other aspect. Sloppiness, incorrect figures, and mistakes show a lack of care and attention and will not reflect well with buyers on your organisation. So, look at the evaluation criteria and manage your time, focus your efforts, and respond accordingly.
You also need to know what you are getting into beforehand. Weighing up the advantages of competitive tendering against the disadvantages will help. You need to know if the tender you are about to bid on is right for you long-term.
The three main things to consider about competitive tendering are:
Remember that an advantage of competitive tendering is that the bid process will be transparent from start to finish. You will have all the relevant information on hand, putting you in the same position as all the other suppliers. Make yourself known for the added value you can bring to the tender. Just be aware that this could mean offering a lower cost for valued work.
Still have questions about competitive tendering? Why not call our Bid Writing Consultants? We’re always happy to help!
We have over 60 years of bid writing experience and an 87% success rate. Whether you’re completely new to tendering or aren’t seeing results – we can help. There are four bid writing packages available:
Once you’ve found a tender you’d like to go for, send it over to us. One of our Bid Writers will write the tender response for you. We’ll provide a full Tender Writing breakdown and even submit it on your behalf.
Tender Mentor can give your tender response a once over before you submit. Our Bid Writing Team will analyse your response, notifying you of any errors and opportunities for improvements prior to submission.
During the Tender Ready service, our team will create professional policies, procedures, and case studies in your company branding. If you already have this content, we will review everything carefully to ensure that nothing is missed. This service also helps businesses who are new to tendering with terminology and industry knowledge.
The Tender Improvement package can help those who have tendered before but aren’t seeing results. Our Bid Writers will assess your previous responses and work with you to develop improved content.
Get in touch to find out how we can help your business grow.
Now it’s time to find a contract opportunity for your company!
You may be wondering where you can find a tender for your business. There’s no shortage of websites offering multi-sector tendering opportunities and leads.
Ideally, you should be searching for a sector-specific site that posts all unique, public and private sector opportunities.
Our sister company, Hudson Discover, has 11 sector-specific tendering portals. One centralised and easy-to-navigate portal can help you save time, streamlining the process.
Once signed up, you’ll have access to your own dedicated Account Manager. They’ll be able to answer any questions you may have about public sector contracts. You’ll also get an email alert when new and relevant tenders are uploaded to your sector.
We host all kinds of tenders in both the public and private sectors. These are inclusive of, but aren’t limited to:
Our support doesn’t end there! Our creative content agency, Vocal, are on hand to help.
The Vocal Team are not afraid to stand up and be heard. And we make sure our clients aren’t either! From small, micro businesses to large organisations, we are vocal about the things that make your business unique.
Our creative service is dedicated to growing your business through striking and thought-provoking content. We’ll take your bid and give it a complete makeover. With professionally designed tender documents, you’re sure to make an impression on the buyer!
Our team specialise in six areas, including:
If you’d like to know more about what we can do for your business, introduce yourself to the team!
Contact us to find out more!
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