How to Grow Your Business Through Tendering

Tendering helps prevent economic restrictions, whether directly/government-imposed, or arising from a general lack of means, ultimately contribute to conflict. As individuals and states find themselves more financially restricted, they stop buying from one another, sales and demand drop, prosperity slows and growth decreases, further compounding the vicious cycle of economic restriction and poverty.

Naturally, tensions rise, relations deteriorate and alliances crumble.

Procurement is essential.

In short, as any bid specialist will tell you, procurement is essential. Having a structured process in place for purchasing goods/services with clear rules, fair evaluations and open procedures are vital to prevent this from happening again.

These processes are designed to ensure equality of opportunity for suppliers, as well as efficient spending and the best value for money for buyers.
Overall, the logic is that this will help bring about a smooth system of trade, promote good financial relationships, help businesses grow, and boost prosperity.

And that's exactly what the tendering and procurement procedure is designed to do.

What is tendering?

Tendering is the process of bidding for a contract to deliver work or goods. Purchasing organisations - typically in the public sector, when looking to procure goods or services, will publish a contract notice.

This will contain amongst other things, a specification detailing the list of goods/services they require, along with specific price-related and technical questions for potential suppliers to answer.

This allows the buyer to do a fair and objective assessment of suppliers tendering for the work, to understand which of them will be able to provide the best balance between quality and cost - or as bid specialists say - the "most economically advantageous tender", or MEAT.

This process helps to ensure that buyers procure services in an objective way that:

Precludes discrimination, nepotism and favouritism.
Ensures efficiency in the spending of public money.
Allows even small suppliers the chance to prove their worth, win work and expand.
Ensures they get the most they possibly can for their money.

How can tendering help a buyer's business grow?

As any Bid Specialist will tell you, tendering is now the most common way for large organisations (especially those in the public sector) to spend money on goods and services. It allows purchasing organisations to organise and understand their outgoings for potentially the next decade.

With their future outgoings largely structured, managed and organised in a viable way, purchasing organisations are then free to organise their growth and expansion plans around this, facilitating a sustainable development/increase of their activities.

In short, engaging in procurement and tendering gives buyers an overview of structured, precise and sustainable future outgoings in order to better plan strategic moves and decisions, increasing their ability to grow, create employment and increase turnover.

Moreover, the tendering process also provides buyers with the opportunity to ask potential suppliers about their ability to add the following values to their organisation.

Social Value
Economic Value
Environmental Value

Indeed, in many public sector bids, there will be an added value section for suppliers to complete, and as bid specialists, we know that this is a vital part.

Added value is what a supplier will offer to go over and above the core requirements of the buyer. These include:

The goods
The people
The services
The procedures

In short, this adds a further element of competition to a bid, where suppliers need to showcase their ability to bring something extra to the table in order to win the work.

This will help purchasing organisations to ensure they get suppliers who will go above and beyond to provide the best service, will spend their money most effectively and will add real value, thereby facilitating the growth and development of the purchasing organisation.

How can tendering help suppliers' businesses grow?

The criticism that the UK is dominated by a collective of large corporations who place a monopoly on the market, force out competition and increase prices, is often heard. Below is a list of points on how the tendering process helps businesses grow.

To all intents and purposes, it does away with the potential advantage that large companies may have when bidding for work.

Tendering provides a neutral, structured and objective set of criteria for the evaluation of potential suppliers, precluding the potential advantage larger companies may have in terms of reputation or turnover. Rather, suppliers are assessed purely on their responses to the technical and financial criteria of each bid.

Bigger suppliers do not necessarily have the advantage you might automatically think they do, in the tendering process.

Many smaller suppliers have fewer overheads and are able to quote less for each job. We have seen many smaller suppliers with regular, loyal customers, established relationships, solid local connections and good references thanks to their size and scope.

Smaller suppliers are able to pay closer attention to the requirements of a bid and craft a good response, rather than the generic responses to tenders that are often churned out by larger corporations.

Often, this proves to be a winning combination.

Meeting thresholds.

In short, tendering provides a structured, fair and neutral way of assessing supplier responses that don't leave room in the assessment for the consideration that anything that might traditionally have been thought of as a commercial advantage for large companies i.e. their size and reputation.

Whilst smaller suppliers will often still have to meet minimum thresholds: This can include the following:

Insurance
Capacity
Turnover

Tendering provides an objective framework and neutral criteria whereby smaller suppliers are assessed on a completely level playing field with their larger competitors, whose perceived "advantages" count for little in the evaluation. This helps small business grow, expand and prosper.
Winning work through tendering, as with buyers, helps give suppliers a definitive overview of their future outgoings, required manpower, and income. This helps the organisation manage their cash flow better, make more informed strategic decisions and gives them the security of regular income for the length of a contract.

This allows them to increase their capacity, expand, reach new markets and benefit from an influx of skills and experience by creating jobs, which in turn creates further business and prosperity. In short, tendering helps to create and perpetuate a vital cycle of growth and prosperity.

Bid Specialist Support:

If you're confused about the tendering process and would like to understand more, check out Tender VLE, our, free, online, virtual learning environment for all things tendering and procurement related. If you'd like to understand even more about the process, about the value tendering can add to your organisation, about how you might win more work or procure more effectively, speak to our Bid Specialists today.