How to bid for contracts

 
 

Once you’ve found the opportunity, it’s time to bid.

This is maybe the most important part of the process, as it’s where you can win an opportunity which could really benefit your business.

But before you jump in, it’s time to take a step back. Because the first question any business should ask itself before bidding is:

“Should we really go for this?”

Preparing tenders can help you to win big orders, but as we saw earlier, it can also be time-consuming, cost money and tie up valuable resources. This is especially important for small businesses. If you don’t get the contract, the money and time spent is usually lost, and it could take time to recover. Remember, bidding for public sector contracts is a commitment, and you need to carefully weigh up whether or not a tender is worth bidding for.

So before you proceed, first answer yes to the following questions:

Does your business meet or exceed the technical skills and experience required?

Does the work fit in with the strategy and positioning of your business?

Can your business afford the time and resource required to bid, even if you don’t win?

Will this contract help your business grow?

Yes? Then let’s begin!

 
 

The tendering procedures

When looking to bid for contracts above the OJEU threshold, at the beginning of the process the awarding authority will specify which tendering procedure is to be used in each tender exercise. This will appear in the Contract Notice.

The tendering process can take different structured forms, but essentially they set out the different steps you must follow in order to bid for and win the contract.

There are  five procedures most usually used to award contracts. They are:

 

Open Procedure – This procedure is the only one stage process. You will need to complete the selection criteria and the tender at the same time and submit them by the required time and date as specified in the documentation. These are evaluated and the contract awarded to the successful bidder.

Jargon Buster!

The Open Procedure offers SMEs a better chance of success as all the parties who successfully meet the selection criteria will have their tender evaluated, whereas in the Restricted Procedure the buyer need only invite five bids and in the other procedures they need only invite three bids.

 

Restricted Procedure – This procedure has two stages. The first stage is often referred to as the Pre-Qualification Questionnaire (PQQ) but is identical to the selection stage in the Open Procedure. Once the PQQs have been evaluated, the buyer will invite a minimum of five contractors to respond to the Invitation to Tender (ITT) by a set deadline. The buying authority will evaluate the responses and the contract will be awarded to the successful bidder.

Competitive Procedure with Negotiation – This procedure mirrors the Restricted procedure in its structure but is intended to be used for the procurement of innovative solutions, or where customisation may be required, or where a detailed specification cannot be easily produced or there is a need for negotiation with bidders. Where negotiation is required, this will take place after the return and evaluation of tenders and before an award decision is made. Bidders engaged in the negotiation stage can be required to submit revised or new tenders following the conclusion of negotiations.

Competitive Dialogue – This procedure is also a two stage process like the Restricted procedure and is used in the same fashion as the Competitive Procedure with Negotiation, but the process is somewhat different. Following the PQQ stage there is a stage titled ‘Invitation to Participate in Dialogue’ (ITPD). At the ITPD stage, buyers will discuss with those successful at PQQ the outline of the solutions they are proposing and may undertake mini bidding rounds to narrow down the number of bidders to take to the next stage. Following conclusion of the ITPD stage, the buying authority will move to the full Dialogue stage of the procedure and will work closely with those invited to this stage, to test and assess the solutions being put forward. Only once the authority determines that they have exhausted the dialogue and can proceed to tender will they issue the ITT, evaluate responses and award the contract.

Innovation Partnership – This is a totally new procedure for the procurement of goods, works or services which cannot be met by any solution currently available in the market. It is designed to encourage genuine innovation and it is unlikely to be used by most authorities or contractors. However, if your organisation offers cutting-edge innovative solutions, you could well encounter it. It mirrors the Restricted procedure in its structure and allows the buyer to undertake research and development with the aim to delivering an outcome. The buyer may contract with a single partner or with a number of partners.

Here’s a breakdown of the main procedures and the different steps towards awarding a contract:

PIN Graphic

Click to zoom

Remember a recent change to the MOD pre-qualification process is the requirement to be Cyber Essentials certified

 
 

Timescales

Each tendering procedure above also has certain ‘timescales’ attached to it for OJEU notices. These dictate how long you will have to complete your full tender response.

The aim of these timescales is to allow sufficient time for suppliers to prepare appropriate responses, taking account of the subject of the contract, the contract award procedure to be used and the need, for example, for site visits.

The table below sets out the minimum permitted timescales and the maximum permitted reductions to these limits:

Selection

Stage(1)

Tender

Stage

If Electronic

ITT Accepted(2)

Tender

Following PIN(3)

Tender by

Arrangement(4)

Urgency(5)

Open Procedure

N/A

35 Days 30 Days 15 Days N/A

15 Days

Restricted Procedure

30 Days

30 Days 25 Days 10 Days At least 10 Days

15 Days / 10 Days

Competitive Procedure with Negotiation

30 Days

30 Days 25 Days 10 Days At least 10 Days

15 Days / 10 Days

Competitive Procedure with Negotiation

30 Days

N/A N/A N/A N/A

N/A

Innovation Partnership

30 Days

N/A N/A N/A N/A

N/A

 

Notes:

1 Where a Prior Information Notice has been used as a Call for Competition in the Restricted Procedure and the Competitive Procedure with Negotiation, the 30 day timescale commences from when the invitation to confirm interest is sent

2 Where the contracting authority accepts that tenders may be submitted by electronic means, the time limit for receipt of tenders may be reduced by 5 days

3 Where a Prior Information Notice was sent for publication between 35 days and 12 months before the contract notice was sent

4 In the Restricted Procedure and Competitive Procedure with Negotiation, the contracting authority may set the time limit for receipt of tenders by mutual agreement with all candidates. In the absence of such an agreement, the time limit shall be at least 10 days

5 In matters of urgency, duly substantiated by the contracting authority, the time limit for tenders shall be no less than 15 days in the Open Procedure. In the Restricted Procedure and Competitive Procedure with Negotiation, the timescale for the selection stage shall be no less than 15 days and for the tender stage, shall be no less than 10 days

*Please note, in some cases the timescales can be reduced. The figures given here show the maximum reductions available. These reduced timescales can be used if the awarding authority publishes a Prior Information Notice to give advance warning of the contract notice.

Although the tendering process varies according to the actual procedure being used, there are four  elements that are common to all tenders: Advertisement; Selection; Award; Contract.

 
 

Stage one: Advertisement

As discussed in the previous chapter, this stage involves the publication of the Contract Notice. A supplier then decides that they want to bid for this opportunity. To start the bidding process, just respond in the manner identified by the buyer in the contract notice. This is sometimes known as an Expression of Interest.

This could mean sending an email to the buying authority requesting the full documentation, or simply clicking a link in the notice to download these documents yourself.

 

C5advertising

 

How to make the most of the tender documentation

– Read the documentation carefully, and read it more than once!

– Pay attention to the evaluation criteria and weightings that will be used to score responses. This information tells you which elements are most important to the buyer, and what they will be assessing.

– Make sure your proposal is for what the buyer wants, not just what you want to deliver, or have provided previously.

Once you have the documents necessary, you can start building your response.

 
 

 

C5selection

Stage two: Selection

The next stage of the process is selection. This is where you begin to be  assessed for the contract and your organisation starts to be scored and evaluated.

In the most common tendering procedures, the first stage of the selection process is a Pre-Qualification Questionnaire (PQQ). The same questions are asked in the selection section of an Open Procedure opportunity.

This is your first chance to impress those evaluating your bid. Think of it almost like a CV. If the response describes how you’ll deliver the contract specification, the PQQ describes you.

 

A PQQ will ask for all of your organisational information – name, type of company, VAT number, registered addresses and so on – which paints a clear picture of who you are, what you have done before and how you did it.

The PQQ will ask questions about the financial and technical experience of your company and will seek evidence relating to issues such as Health and Safety, Equalities, Quality Control (eg ISO)and Qualifications, as well as requiring references from past clients and perhaps your bankers.

Are you a Living Wage employer? This is becoming a crucial question your business must answer if you’re to be successful in public procurement. Recently in Scotland, being a Living Wage employer became  a requirement for all firms looking to win business with the Scottish public sector.

These are all questions covered by the PQQ and you should be able to answer them in full.

Your PQQ checklist

To help you, we’ve developed a quick checklist of information you will be asked to provide at the PQQ stage. The following points should help you to put together a good quality PQQ:

Give yourself plenty of time. You need to answer the questions carefully, make sure you have all the necessary paperwork to hand, and that this is up to date. This can take time, so factor this in from the beginning.
Make sure everything is up to date. This is especially important for any policies that you submit, which must be up to date and in accordance with all current legislation, or they may be considered invalid.
Pay attention and be thorough. Read the PQQ carefully and, if you are unclear about any of the requirements, contact the person named within the documents you received.
Follow the instructions to the letter. Inaccurate or incomplete forms, or the failure to follow the instructions is likely to result in your application scoring badly or even being rejected.
Remember what you already know about the contract. Although at this stage you are supplying information about your organisation, if you tailor this information and make sure it’s relevant to the advertised work, and you demonstrate an understanding of what will be required, your PQQ will score more highly.
C5tip6 Brag. Don’t be afraid to use the PQQ to promote your organisation and provide details of experiences, achievements and why you think your company not only has the ability to deliver, but is the best to deliver the project.
Make it look good. Presentation is important. The overall presentation of your PQQ and supporting information will not only create a good impression, it will make it a lot easier for a buyer to evaluate. Good presentation can come down to small things such as clear type face, line spacing and use of bullet points.
Be clear. Clearly index or reference any supporting information to the question it relates to. A PQQ that is easy to understand will be easier to score highly.
Include an executive summary. Everyone likes an executive summary. It’s a clear and simple way to get the main information across quickly and create a good first impression. Include an Executive Summary which briefly introduces your organisation and shows that you understand what you are bidding for and why.
Proofread. Mistakes look unprofessional. Remember, this is your CV, and typos in a CV are a major no-no.

To make sure you have all of the correct documentation in place before submitting a bid, download this handy checklist to keep you on the right track.

 
 

The UK Government has released a Standardised PQQ Document in order to help streamline this process. To see what this PQQ looks like in full, visit GOV.UK

Keep these tips in mind and use the checklist provided to create your best possible PQQ.

Jargon Buster!

In the Open Procedure, the PQQ is the Selection Stage of the response and accompanies the tender document in a one stage process. The submitted tender must be accompanied by the completed selection documentation and the selection documentation will be evaluated first by the buying authority. If a contractor has met the authority’s specified minimum standard, the tender will be evaluated. There is no restriction on the number of tenders to be evaluated, unlike in the other procedures.

 
 

Stage three: Award

Once the PQQ has been submitted, it will be evaluated against the buying authority’s scoring criteria. The PQQ stage lets the buyer know that you are qualified to fulfil the needs of the contract. If you are successful at this stage, you will be notified and, in some cases, given an Invitation to Tender (ITT).

The ITT is a formal communication from a public sector organisation to a supplier inviting it to submit a full tender response.

 

C5award

 

The ITT will include a full specification for the contract requirements, the pricing schedule, instructions for submitting the tender, the terms and conditions which will govern the contract once it is active and any other relevant documentation.

Once submitted, your tender will be scored and, if you’re the best fit to provide the goods, works or services required, you’ll reach the final stage of the process: the Contract.

And that’s it! You’ve done it!

Just kidding. We wouldn’t just skip over the most important part of the process!

Writing and submitting your full tender response is the single most important part of winning work with the public sector. It’s literally where the contract is won or lost.

Now that you know how to bid…

It’s time to find out how to win.

Writing a tender response is a skill. It takes time, practice and perseverance. But if done well, it can be your key to winning your next big business opportunity.

We’re going to show you how to write a tender response that wins.

 
 

If you liked this chapter, you might also like this:

 
 
 

How to Find Contracts

Back Chapter 4

How to win contracts

Chapter 6 Forward

 
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