Over 30 billion dollars is being spent through the tendering process in Australia yet many businesses minimise their opportunities in reaping the rewards of generating profitable contracts. I’ve seen many businesses that are too busy responding to tenders to stop and look at ways they can start winning tenders. I’ve asked many companies about their strategy for responding to particular tenders, only to find that there hasn’t been one. I’ve asked companies what criteria they used to determine which tenders they should respond to, only to find again that there aren’t any. This is not a good start for any tender, especially when we consider how many hours need to be spent on a tender submission.
It’s important to recognise that a winning submission is the end result of a chain of well performed events. This chain begins with the selection process of the tender and ends with the final presentation given to a tendering board.
Why a tender submission is the most important selling document you’ll ever write? It’s simple. The document you submit is the only basis on which the purchaser can make a decision and judge your company on its ability to deliver on their requested outcome. In other selling situations, you can follow up a proposal with a telephone call and discuss any areas that a purchaser is not too sure about. Being able to follow up a proposal also gives you further opportunities to sell the benefits of your company’s products or services. Yet in a tendering situation the document has to sell all aspects of the project and offer better solutions than the competition.
The 1st element – Existing Relationships When responding to tenders you need to identify whether you are the right fit for the contract on offer. There’s no point in responding if you haven’t got a clear understanding of the company or organisation asking for the tender. It’s important to gather intelligence on the tenders available in your industry. This will give you valuable information and knowledge of the market potential, who your competitors are and what are the current solutions being sought by purchasers. Depending on the industry many tenders are recurring and constantly come up for resubmission, so you can prepare yourself to respond more effectively on future offers. This also allows you to educate and inform as well as build a relationship with potential clients that dramatically improve the chances of you being invited to tender.
A great source of information on tenders are notification companies that can give you information on tenders specific to your industry these are easily accessible on the internet.
The 2nd element – Be one of only a few responses Many tenders are won before they are published. When a company asks for an expression of interest publicly they have already invited others personally based on previous relationships to tender for a future project. These organisations will generally go to between 3 and 5 suppliers to determine who will be the best provider of a solution. Then they will publish the tender to open the response to other potential suppliers in the market place. If you have been invited to tender your chances of winning are dramatically improved because the organisation who has requested you to respond has an understanding of your capabilities to deliver on projects. That’s why from a strategic point of view it’s important to build relationships that add value to potential prospects in the market place.
The 3rd element – Does the tender suit your marketing strategy? One of the key questions to ask in your tendering process is what are the other opportunities around a tender? For example, if a company was looking for a recruitment firm to consult on developing systems and processes to help build their human recourses capabilities, then does the company also require assistance in recruiting executive staff as an added service. This would be outside the request for the original tender and may be one of several opportunities available for extra work. Another question to consider is will the tender produce a strong strategic alliance. This means that by getting involved with a company, can they open the door for you to do business with either their clients or other areas of the same company and can they utilise your expertise to add value to their clients. This will dramatically improve the chances of dealing with like minded companies.
The 4th element – Is your tendering team resourced and available? As mentioned before, a tender is the most important selling document you’ll ever write. To maximise your opportunity you need to make yourself ready to respond efficiently and effectively. You have to clearly differentiate your service and your process, and you’ll need to prioritise the tender appropriately so you meet your deadline for submission. You must have selection criteria that determine if you are ready and able to respond and that the tender fits your capabilities to deliver. It’s also important to improve the writing skills of your team so that you communicate effectively in your submission. Allow for additional staff or help when you’re tendering or bring in outside assistance to help you pull your document together. You’ll need all the help you can get to meet your deadline of a large project.
The 5th element – Have 75% of your document pre-prepared prior to release You can template most of your documents in advance prior to a tender being released. This will dramatically improve your ability to respond as you can have the following items pre-prepared:
- Your mission statement
- Background of the company
- Executive summary
- Referees and testimonials
- Current business activities
- Financial statements
- Occupational health and safety
- Quality Assurance certifications
- Training programs
The presentation of the submission should be already decided on and designed. A management process for your document should be in place. Your cover, tabs, diagrams and text layout should be pre-prepared and have available an image library that has templated graphics to use on your documents.
The 6th element – Do you have a competitive advantage? It’s important to identify your competitive advantage in your tender. There needs to be a clear indication as to what makes your company an obvious contender for winning the contract. Things you should consider in including that show what sets you apart from your competitors are: you may have specialist services; your distribution systems are state of the art; the expertise of your team is highly technical; your service is geared towards solving frustrations that people have with your industry; and you may provide extensive back up and support beyond the standards. A key consideration may be, by utilising your services, that you’ll reduce their costs and add to their bottom line. Part of your point of difference is your pricing policy. The following are issues to be considered:
- Remove non related marketing expenses from pricing
- Consider lifetime value of the client not just the tender itself
- Consider the value of further sales opportunities that come from existing relationships
- Consider the strategic advantages of external relationships
The 7th element – Clearly articulate your understanding of the purchaser’s culture, requirements and value in solution submitted Five things that can dramatically demonstrate your understanding of the purchasers needs:
- Write in such a way that reflects the culture of the purchasing company (use their terminology and style in your writing)
- Clearly articulate your understanding of the requirements and show you have the ideal solution
- Articulate your value for money
- Demonstrate your compliance and non compliance
- Write in the same order as the specifications (question and answer approach)
Five ways to avoid tendering blunders:
- Failing the capacity to do the job – not including case studies or referees to illustrate competence
- Trying to teach the buyer a lesson (they already have an idea of what they want so stick to it)
- Criticising tender requirements
- Failing to answer questions or submitting up-side down pages and spelling mistakes
- Submitting a bid past its deadline
The 8th element – Presentation and Submission To set your document apart from your competitors, it needs to look different from the others – you want them to be drawn to your document. Here are 7 things to consider:
- Have your tender taken from the pile first – use their images to reflect their corporate branding so the document represents them (if you use their images and logos make sure you get permission from the purchaser to do so)
- Reflect the layout of the tender specifications
- Show a level of commitment to winning within the submission
- Maintain the readers interest visually (use flow charts, images and graphics throughout the document)
- Make it easy to find specific sections of the document (use tabs to separate the different sections)
- Have colour testimonials with photos on file for digital print
- Use digital printing to lift the presentation of your document and use quality stock for printing (laminate covers and use paper that enhances the photographic quality of your images)
The 9th element – Your ability to deliver This is very important – make sure you are able to deliver on the contract. This includes meeting the budgets, distribution, service and technology. If there are any extra costs involved outside the tender, make sure you clearly articulate any possibilities of the potential to increase the investment and the procedures to do so. Remember this is a legally binding contract so ensure you check everything before you deliver your document.
The 10th element – Further tendering and sales opportunities Evaluate the value of ongoing relationships with the organisation such as your credibility for the next tender and further sales opportunities to come from within. By delivering a high level of service during the contract this will dramatically improve your chances of renewal. For consistency present ongoing reports with the same level of commitment as your tender document. This should be quite easy as you have all the information from your research. Tendering is an exciting game that can generate an enormous amount of business whether you are a small to medium enterprise or a large corporation. The point here is that preparation and strategy are the keys to a winning tender submission.