Suppliers are increasingly shifting away from reactive tendering and instead applying business development processes as part of a longer term bid strategy. Why is this the case and how can your company follow suit?
The award of public contracts is based on stringent criteria with well-defined metrics that prioritise value for money. In tendering competitions, the art of persuasion can only be enacted by suppliers if they know and understand their potential customers.
While you can’t win a public contract based purely on an effective sales pitch or by arranging a meeting with a potential buyer, there is no impediment to suppliers proactively engaging with buyers prior to the tender competition starting with a view to raising awareness of their services and laying the groundwork to influence future bids.
Are buyers receptive to being approached by suppliers?
Market awareness is as important to public sector buyers as it is for any other decision maker with a limited budget, and can be a critical factor in shaping procurements.
Knowledge of available solutions allows procurement teams to draft well-informed invitations to tender that reflect market reality, and this is precisely why many buyers conduct supplier engagement exercises ahead of procurements via Prior Information Notices and meet the buyer events.
I want to begin tendering proactively. Where do I start?
At Tenders Direct we encounter many suppliers who bid reactively and blindly without having had any previous contact with buyers. This “firefighting” approach can leave you on the back foot, put pressure on time and resources, and ultimately prevent you from maximising your chances of success.
The acquisition of market intelligence and the formulation of a long term bid strategy are key. Cultivating relationships with buyers lets you gain an insight into their specific needs and preferences, making it more likely that you can create a customised bid that makes you stand out from the crowd.
Identifying opportunities ahead of time including renewals of existing contracts can allow you to create a pipeline of prospects, conduct go/no go assessments, and begin pre-engagement efforts and bid preparations long before a tender is even published.
Join our free Business Development for Tenders webinar on Friday 9th November 1pm – 1.45pm for an in-depth discussion of how to take the initiative in your tendering activities, including how our Advance Tender Alerts tool can help.
As he delivered the Autumn Budget yesterday Chancellor of the Exchequer Philip Hammond joked that the decision to address Parliament on a Monday – rather than the traditional Wednesday – was an attempt to avoid Halloween-related headlines.
It didn’t work, as many observers are today pointing out that Hammond is handing out a lot of treats and some are suspicious that this is some kind of trick intended to gain the good will of voters ahead of a rumoured general election.
Hammond had to find funding to make good on an earlier pledge of an extra £20 billion per year to the NHS by 2023 and also ensure that funds are allocated to cover any additional costs associated with the Brexit process. He ticked these boxes and had a few other surprises in store.
Key announcements included:
- Additional £20 billion over five years for the NHS including £2bn per year for mental health
- A £30bn investment package for roads in England
- Extra £1 billion for Defence with a focus on cyber warfare
- Extra £500m to fund an additional 650,000 homes
- Additional £500 million for Brexit-related costs
- No further Private Finance Initiative (PFI) contracts to be signed
- The National Living Wage to increase by 4.9% to £8.21 per hour as of April 2019.
- Apprenticeship levy for smaller companies reduced by 50%
What impact will this have on public procurement?
Such substantial spending increases in health, infrastructure and defence will inevitably result in more contract opportunities for suppliers in certain subsectors over the coming years, but perhaps the most notable news is the abolition of the Private Finance Initiative (PFI) procurement model.
The demise of PFI marks a shift in national procurement strategy and will be welcomed by many due to the failure to deliver savings to the taxpayer as intended. Indeed, a National Audit Office report published in January this year found that taxpayers will be liable for almost £200 billion in payments to PFI contractors over the next 25 years.
Hammond made it clear that the government remains committed to the overall concept of Public Private Partnership (PPP) if it “delivers value to the taxpayer and shifts risk” to the private sector, but stated that “there is compelling evidence that PFI does neither”.
We’d like to hear your views about the budget – tell us what you think in the comments below.
We’re pleased to announce dates over the coming months for a new selection of free webinars:
Getting to the ITT – Tuesday 30 October
Writing Compelling Bids – Thursday 6th December
Advanced Bid Writing Skills – Thursday 7th February
If you’ve ever wanted to attend our full day training courses but are unsure of the content and what skills and knowledge you will come away with, you can now attend condensed overviews of our most popular courses online.
Business Development for Tenders – Friday 9 November
We’ll discuss the advantages of pre-engagement with public sector buyers and demonstrating how our Advance Tender Alerts service can help suppliers escape from the rut of reactive tendering in our new Business Development for Tenders webinar.
Tendering and Brexit – Wednesday 23 January
We’ll also be keeping you informed about the impact of Brexit as the endgame takes shape, focusing on how it will affect public sector tendering and what steps suppliers should be taking to prepare. As well as these webinars, we’ll of course be sharing our analysis on the Tenders Direct blog as and when we have some level of clarity on the outcome of negotiations.
To find out more about all the webinars available and to book your space, visit:
Questions? Leave a comment, chat with us at www.tendersdirect.co.uk or call 0800 222 9009
The UK Government has announced plans to create a new e-procurement system to replace the Official Journal of the European Union (OJEU) in the event that the ongoing Brexit negotiations do not produce an agreement.
While it is still unclear whether or not a deal will be reached, the new guidance outlines a contingency plan intended to guarantee continuity in UK public contracting.
What does this mean for public procurement in the UK?
The UK is due to formally leave the EU on 29th March 2019. Until that date, tenders above the relevant threshold must still be published in the OJEU as normal. Subject to the nature of the UK’s continuing relationship with the EU, it is possible that this will continue to be the case.
If there is no agreement, a new system for publishing above-threshold notices will be implemented. Aside from this, however, all the national procurement portals of the constituent parts of the UK – Contracts Finder, Public Contracts Scotland, Sell2Wales, and eTendersNI – will remain in place.
What do you think?
As Brexit approaches we have been receiving more and more queries from our subscribers – whether they be supportive of exiting the EU or not – about the future of public procurement in the UK. Now that the endgame is beginning to take shape, we’d be interested to know your views. When it comes to public procurement, are you preparing for all eventualities? What else would you like to see clarified before March 2019?
Ask us a question or let us know what you think in the comments below.
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What is social value?
The purpose of social value in public procurement is to maximise the reach of public expenditure by ensuring that local communities, economies, and the environment benefit in some way from any given contract.
The requirements were introduced in part to address a perception that taxpayers were often not benefiting in any tangible way from public spending in their local area.
While cost remains the single most important metric in the award of a public contract, social value considerations can be scored with a weighting of up to 20%.
This has served to redefine the concept of value for money in publicly funded projects, placing more emphasis on going the extra mile than simply offering the lowest quote.
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What are framework agreements?
Frameworks are “umbrella agreements” that sets out the terms – particularly relating to price, quality and quantity – under which individual contracts (call-offs) can be awarded throughout the period of the agreement (normally a maximum of 4 years). They are typically used when the buyer(s) identify a need for specific products or services but are unsure of the scope or time-frame.
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If you’ve read the two previous blogs in this series – The Challenge and The Fix – you’ll understand the problem suppliers face in sourcing suitable public contracts and the mechanics of the Tenders Direct solution. In the final part, we look at how we help our customers complete the journey from finding a promising contract to winning it…
Continue reading “A Closer Look: The Solution”