How Tendering Works: A Clear Guide for Businesses in 2026
Tendering is the formal competitive process through which public sector organisations — and many private sector buyers — award contracts for goods, services, and works. If you want to win public sector contracts consistently, understanding how tendering works is the essential starting point. Once you understand the process, the same disciplines apply across every buyer type, every contract value, and every service category.
This guide explains how tendering works from start to finish — what buyers do before publishing a contract, what happens during the evaluation process, and what your business needs to do to compete successfully. For the complete step-by-step submission guide, see our guide to how to write a bid.
What Tendering Is — and Why It Exists
Tendering is a regulated, transparent, competitive process for awarding contracts. Public sector buyers are legally required to use competitive tendering above defined contract value thresholds — to ensure public money is spent fairly, transparently, and in a way that delivers the best value for taxpayers.
The legal framework governing public sector tendering in the UK is the Procurement Act 2023, which came into force in February 2025. It replaced the Public Contracts Regulations 2015 and introduced new transparency requirements, strengthened SME access provisions, and updated the evaluation standard from Most Economically Advantageous Tender (MEAT) to Most Advantageous Tender (MAT) — reflecting a broader assessment of quality, social value, and price rather than primarily economic factors.
The result is a procurement landscape that is more accessible, more transparent, and more commercially attractive for businesses that invest in understanding it. For the complete overview of what tendering involves for suppliers, see our guide to tendering for contracts.
How a Buyer Prepares a Tender
Before a tender is published, a significant amount of work happens on the buyer’s side. Understanding what buyers do to prepare a tender gives you insight into what they are looking for when they evaluate responses.
The buyer develops a specification — a detailed description of what they need, to what standard, under what conditions, and with what performance requirements. They set supplier eligibility requirements — minimum financial standing thresholds, mandatory accreditations, required experience. They set the evaluation criteria and weightings — how the assessment will be split between quality, price, and social value. And they decide the procurement procedure — whether to run a single-stage open procedure or a two-stage restricted procedure with pre-qualification.
Once this preparation is complete, the tender is published — on Find a Tender Service for above-threshold contracts, on Contracts Finder for below-threshold contracts, and on the buyer’s own procurement portal. From this point, the opportunity is open to any eligible supplier who downloads the documents and submits a compliant response before the deadline.
The Two Main Procurement Procedures
Open procedure
The buyer publishes the ITT directly. Any eligible supplier can download the documents and submit a response. The buyer evaluates all compliant submissions — including eligibility checks — in a single stage and awards the contract to the highest-scoring submission. Open procedure is the most common process for below-threshold contracts and many above-threshold service contracts. It is the most accessible entry point for organisations new to tendering.
Restricted procedure
The restricted procedure runs in two stages. In the first stage, the buyer publishes a Selection Questionnaire (SQ) — formerly called a Pre-Qualification Questionnaire (PQQ). Suppliers complete the SQ, which assesses eligibility — financial standing, required accreditations, and relevant experience. The buyer shortlists the most capable suppliers. Only shortlisted suppliers receive the Invitation to Tender (ITT). They then submit full quality and pricing responses, which are evaluated and scored to determine the winner. Our guide to the pre-qualification questionnaire covers the SQ stage in detail. Our guide to ITT basics covers what the invitation to tender stage involves.
How Tenders Are Evaluated
Public sector tenders are evaluated under the Most Advantageous Tender (MAT) standard — the submission offering the best overall value across quality, price, and social value. The evaluation weighting is published in the ITT documents before submission.
A typical evaluation weighting looks like this: quality responses weighted at 60%, price weighted at 30%, social value weighted at 10%. In some contracts, social value carries a higher weighting. In construction and infrastructure contracts, technical quality often carries the highest weighting. Reading the evaluation weighting before writing anything is one of the most important steps in producing a competitive submission — it tells you where maximum effort produces maximum scoring return.
Quality responses are marked by an evaluation panel against published mark descriptors — typically a 0 to 5 scale where 5 is awarded for a thorough response addressing all requirements in extensive detail with added value, and 0 is awarded for a nil response or one that raises major concerns. Our guide to understanding tender scoring systems covers exactly how evaluators mark each response level.
Pricing is scored against a defined mechanism — typically comparing each supplier’s price against the lowest compliant price submitted, with marks awarded on a sliding scale. Social value is scored against the buyer’s stated priorities — with specific, locally grounded, measurable commitments scoring higher than generic statements. Our guide to the tender evaluation process covers how the complete evaluation works in practice.
Why SMEs Can and Do Win Government Contracts
A persistent misconception about tendering is that it is only for large companies. It is not. The evaluation criteria are the same regardless of your organisation’s size. The evaluation is based entirely on what you submit — not on your size, your history, or who you know.
The government has a published target to spend £1 in every £3 with small and medium-sized businesses. The Procurement Act 2023 introduced open frameworks that SMEs can join throughout their operational life, pipeline notices that give smaller suppliers more preparation time, and transparency requirements that make procurement more accessible. Many framework lots are specifically sized for SME access. Below-threshold contracts are designed to be accessible to organisations at the beginning of their public sector journey.
The most consistent barrier for SMEs is not the process — it is insufficient preparation. An SME that invests in building its evidence base, developing its compliance documentation, and understanding what buyers evaluate will consistently outperform larger competitors who submit generic, poorly evidenced responses.
The Typical Tendering Timeline
Understanding the timeline from contract notice publication to contract award helps you plan your resource and set realistic expectations.
Publication of contract notice. The buyer publishes the opportunity on the relevant portal. For above-threshold contracts, a minimum response period applies under the Procurement Act 2023.
Response window. Suppliers download the documents, assess the opportunity, prepare their submissions, and submit before the deadline. For above-threshold open procedure tenders, response windows are typically four to eight weeks. For restricted procedure ITTs following a pre-qualification stage, response windows are often three to six weeks.
Evaluation period. The buyer’s evaluation panel assesses all compliant submissions against the published criteria. Evaluation typically takes two to eight weeks depending on the number of submissions and the complexity of the contract.
Standstill period. Above-threshold contracts are subject to a mandatory standstill period — typically ten days — between the notification of the award decision and the formal contract award. This allows unsuccessful suppliers to seek a debrief and, if appropriate, to challenge the decision before the contract is signed.
Contract award and mobilisation. The contract is formally awarded and signed. The mobilisation period — the time between award and service commencement — varies by contract type and complexity, typically four to twelve weeks.
What Your Business Needs to Compete
Four things should be in place before you pursue any live tender opportunity.
Comparable case studies. Two to three examples from the past three to five years demonstrating delivery of comparable services — similar type, scale, and client category. Without directly comparable case studies, your evidence scores will be consistently low regardless of how well your responses are written.
Current compliance documentation. Health and safety policy, environmental management policy, equality and diversity policy, data protection policy, and modern slavery statement — all signed, dated, and reviewed within the past twelve months. Missing or outdated documentation is a disqualifying compliance failure.
Financial standing. Your annual turnover must typically be at least twice the annual contract value of any contract you pursue. Check this against your most recent filed accounts before committing to any submission.
A bid no-bid discipline. Not every opportunity is worth pursuing. Apply a structured assessment to every opportunity before committing any writing resource. Our guide to the bid no-bid decision covers the complete framework.
Tendering as a Long-Term Commercial Strategy
The most important thing to understand about tendering is that it is a long-term commercial strategy — not a short-term revenue fix. A first submission rarely wins. The learning curve from first submission to consistent wins typically takes six to twelve months of sustained effort. But the organisations that commit to that curve — building their evidence base, developing their bid discipline, learning systematically from every debrief — consistently achieve significant contracted revenue growth.
Every contract won provides the case study evidence that makes the next bid more competitive. Every debrief produces the intelligence that improves the next submission. The track record compounds. An organisation that commits to tendering as a core commercial strategy over three to five years will look fundamentally different — in revenue, in client base, and in competitive capability — than one that treats tendering as an occasional reactive activity. Our guide to building a tendering strategy covers how to structure this as a planned commercial programme.
Frequently Asked Questions About How Tendering Works
How is a winner chosen in a tender?
The contract is awarded to the Most Advantageous Tender — the submission offering the best overall value across quality, price, and social value. The evaluation weighting for each criterion is published in the ITT documents before any submission is made. The winner is the supplier whose combined score across all weighted criteria is highest — not necessarily the cheapest price or the longest response.
Do I have to be VAT registered to tender for government contracts?
VAT registration is not a universal requirement for public sector tendering. However, many above-threshold government contracts require suppliers to have an annual turnover above the VAT registration threshold — which would typically mean registration is already required. Check the specific financial standing requirements in each tender’s selection questionnaire. For below-threshold contracts, VAT registration is not routinely required.
Can I lose a tender for being too cheap?
Yes — if your price triggers an abnormally low tender query. Under the Procurement Act 2023, buyers have the right to seek clarification on prices that appear unusually low and to reject a submission if the explanation is not satisfactory. A price that does not reflect the true cost of delivery raises concerns about whether the contract can be delivered to the required standard. Price competitively and sustainably.
How long does it take to win a first public sector contract?
From deciding to tender to receiving payment on a first contract, most organisations take six to eighteen months. Building foundational content takes one to two months. Identifying and responding to a suitable first opportunity takes four to eight weeks. The buyer’s evaluation and award process takes two to four months. Mobilisation before the contract starts takes four to eight weeks. Plan your timeline accordingly and commit to tendering as a long-term commercial investment.
Start Winning Contracts With Expert Support
Together: The Hudson Collective has helped thousands of organisations understand how tendering works and start winning public sector contracts — from first-time bidders building their foundational content through to established suppliers managing complex framework programmes. Our team holds an 87% win rate across all sectors, working with 3,500+ organisations across 52 countries.
Send us your opportunity and we will tell you exactly where we can give you the edge.
Tell us about your opportunity.
About the author: Written by Joshua Smith, a seasoned bid-writing expert with experience across the UK, Middle East and US, helping organisations secure the contracts they deserve through high-quality, competitive tender responses.