[last-modified: February 2022]
Are you interested in procurement and wondering what bids and tenders are? Well, you’ve come to the right place! This blog contains a beginner’s guide to bids and tenders. It will answer all of the frequently asked questions you may have. So, let’s get into it!
So, let’s start with the basics, what are bids and tenders? Well, bids and tenders mean the same thing and are used interchangeably.
They are documents that are a written request that is sent out to potential suppliers. A buyer will release an invitation to tender (ITT) when they are looking to procure a good, service or product. They are essentially looking to outsource a solution to a supplier.
A tender document is the basis of a tendering process that details certain contract criteria. This allows qualified and interested suppliers to compete for the contract. A buyer will then evaluate the responses and award the contract to their chosen supplier.
Think of them as job applications. The supplier submits a proposal as to why they are the best candidate for the contract. The buyer will review the proposals and find the best fit for the job.
There are many advantages of securing bids and tenders, for example:
Bidding for work can help you secure a pipeline of work for your business. Particularly if you secure a place on a framework agreement or Dynamic Purchasing System (DPS). These systems are frequently used in an array of sectors including healthcare and construction. The benefit of these is that they can run for years at a time, with the possibility of extension.
For example, we helped one of our clients secure a £200million contract. We also helped another increase their annual turnover by 20%! These are only two examples of what tendering can do for your business. There’s plenty more for you to discover on our tender writing testimonials page.
If you’re responding to bids and tenders in the public sector, you will be guaranteed pay upon winning a contract. This is because public sector organisations are bound by their contractual agreements. The Crown Commercial Service (CCS) has to pay suppliers within 60 days of invoice. This is to comply with the Prompt Payment Code. This can give suppliers piece of mind when delivering contracts. The same can’t be said for the private sector. They aren’t bound by the same rules and regulations as the public sector. It’s something to bear in mind when tendering for private sector organisations.
If you’re a small or medium-sized enterprise (SME), we’ve got good news. If you think that only the big corporations can secure public sector contracts, you’d be wrong. The British government actually has a target to spend £1 in every £3 with SMEs. This means they are actively looking to award contracts to smaller businesses. Therefore, you’re in with a good chance when applying for public sector contracts.
Bids and tenders will often require you to include 2 – 3 case studies of past contracts you have delivered. Securing smaller contracts can help you build up that experience. The more case studies and experience, the bigger contracts you can go for. The bigger contracts you can go for, the bigger your business will grow. Securing a place on a framework or a DPS is a great place to start.
On top of that, this experience will help you to develop skills. Perhaps you will learn something from one contract and apply that to your next one. Learning is so important, and this is an excellent way of doing just that. The more experience you have, the more you learn, and the better you’ll perform.
Another great benefit from bidding is that you can build relationships through your work. Winning a tender and impressing the buyer means they are more likely to want to work with you again. They will also likely suggest your services to other businesses they know. They may even give you a glowing testimonial to help you secure future work. These successful contracts and testimonials can be used in future bids, as mentioned in our previous point. So, you will stand out to other buyers if you have a record of getting businesses the results they want.
The two most common tendering procedures are the open tendering procedure and the restricted tendering procedure.
This is essentially the simplest tendering process. An ITT is released by the buyer and any prospective supplier can submit a response. The responses are then reviewed and evaluated, and the contract is awarded. If tendering in the public sector, the contracts will be awarded to the most economically advantageous tender (MEAT).
A restricted procedure will likely be used for the procurement of more complex goods or services. They are usually used for contracts with a higher budget too. For this, a buyer will want to shortlist the bidders ensuring that they’ll be able to deliver the contract. This procedure is a two-stage process:
A pre-qualification questionnaire (PQQ) or selection questionnaire (SQ) is released. Prospective suppliers will have to meet certain eligibility criteria in order to progress. You can expect to be asked about your business:
Once the buyer has assessed questionnaire responses, they will shortlist eligible businesses. These businesses will then be sent an ITT. These companies will then go onto submitting their ITT response and the contract will be awarded.
It is common for buyers to ask to see at least two years’ worth of accounts when tendering for work. Although this is not always the case with smaller contracts, sometimes strong case studies can be used instead. In our experience, three years of trading is a strong base to start tendering for work.
When applying for bids and tenders, your economic financial standing will be assessed. This will be determined by the following:
Bids and tenders will require you to include up to three case studies of past contracts you have delivered. These must be similar in scope and complexity as the one you’re bidding for. They should be within the last three to five years. A buyer wants to see that you have delivered past contracts successfully and that you’re reliable.
Before you start writing your response to a bid, you should first ask yourself if you can fulfil the contract. You should read the specification carefully. There may be certain qualifications or accreditations you need in order to be eligible. Once you’ve established that you meet all the criteria, think again. Do you have the resources to actually deliver the contract? Are there multiple locations? Do you have enough staff? These are all things you need to consider before progressing with your bid response.
The last thing you want to do is convince a buyer you can deliver a contract that you can’t.
So, now you know the processes and procedures of bids and tenders, you may be wondering where to find them. There’s no shortage of websites offering multi-sector tendering opportunities and leads. Ideally, you should be searching for a sector-specific portal that posts unique, private, and public sector opportunities.
If you’re simply relying on CPV codes, you may be missing relevant opportunities. This is because CPV codes are often mislabelled. Our sister company, Hudson Discover, hosts 11 sector-specific tendering portals. You are able to filter results via keyword, budget, location and more – streamlining the process.
These sectors consist of:
Our portals are updated daily by our Opportunity Trackers, and we offer tender notification services. This way, you can keep up to date with all of the opportunities that may be perfect for you! Afterall, the last thing you want is to come across the perfect tender too late.
Now you’re a bit more familiar with what’s required, you may be looking for some writing support. Writing isn’t everyone’s strong suit and that’s ok. Outsourcing a bid you’ve found to bid writing specialists can help you secure that next contract.
Here at Hudson Succeed, we pride ourselves on being bid writing experts. We hold an 87% success rate and have over 60 years of collective bid writing experience. We offer four levels of bid writing support to suit every business need. You may not need the whole bid written for you; you may simply need it proofread before you submit. We can help with that. Our services include:
Once you’ve found the perfect bid for your business, send it our way. Our Bid Writers can take care of the whole thing for you they’ll even submit it on your behalf. They’ll let you know what they need from you, providing you with a full Tender Writing breakdown.
Our Tender Ready 4-week programme is perfect for businesses that have never tendered before. A Bid Writer will work with you to ensure you have everything in place to tender successfully. Tender Ready offers your business:
If you’ve been tendering but aren’t seeing success from your current efforts, our Tender Improvement package can help. Our Bid Team will assess your previous responses and tender documents. They will work with you to improve for future submissions. This package includes a 12-month subscription to a Hudson Discover portal and additional tendering development services.
If you’ve written your own tender response and need it double-checked for errors, Tender Mentor can help. A Bid Writer will proofread your work for any inconsistencies, grammar, or spelling mistakes. They will also ensure it’s in line with the specification before you submit. This is a great way of improving your skills and understanding of how to polish your tender.
Upgrading to Discover Elite can help optimise your tendering efforts – even when you’re busy. Our two new time-saving tools can improve your competitor awareness and success rate when bidding for a contract.
The Ultimate Time Saver package offers your business:
Contact us to find out how we can help your business grow.
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