New Public Procurement Thresholds for 2020

2020 EU / OJEU Procurement Thresholds

Procurement thresholds for public sector tenders are updated for 2020. Associate Consultant, Carl Rogers, is an expert on public procurement. In this post he explains the changes, the importance of contract values and the effects of Brexit.

Public Sector Procurement Thresholds for 2020

Timings

The new procurement thresholds affect new tenders from 1st January 2020 to 31st December 2021.

Why are Procurement Thresholds Important?

Public sector buyers must be aware of these thresholds. These are the values above which a European (OJEU) advert must be placed to ensure competition. Failure to do so can result in legal action being taken against the contracting body.

The procurement thresholds are applicable to public purchasing. This includes government departments, local authorities, NHS Trusts, utilities, housing associations etc. They cover the following:

What has changed

The actual thresholds have increased slightly. This might be due to the fluctuating exchange rates compared to the last threshold renewal. The new thresholds are net of VAT and are as follows:

How to Re-tender for an Existing Contract

You have to re-tender for an existing contract. What do you do? Don’t worry, this guide to re-tendering will help. It explains what to do and how to avoid some common pitfalls when re-tendering. Follow these steps to increase your chances of keeping the contract.

Re-tender for an existing contract

How to Re-tender for an Existing Contract

The need to re-tender for an existing contract is a common reason for clients contacting us for help with a bid. They tend to fall into these categories:

  1. They have never had to submit a modern, more complex tender before and so are not sure how to approach it. Many clients have held contracts for years. They have won previous re-tenders which were price driven but not so complicated. This is typical of contracts involving public money falling in line with OJEU rules.
  2. A friendly buyer has recommended that they engage a tender consultant. Sometimes the buyer has seen a past submission which was not up to scratch. Or the buyer knows the client’s in-house resources / skills might not be able to create a winning bid.
  3. It’s a must win tender. If they lose it, it will hurt the business.

Whatever the reason, they want to win the tender and keep the contract.

The starting point is to follow tendering best practice.

This is obvious – do everything correctly and you increase your chances of winning! There’s lots of information about this in our blog. Start with how to answer tender questions and writing positive Tenders. Also, make sure that you avoid making the most common mistakes when re-tendering.

Apart from applying best practice, the following steps will help you win the re-tender:

Don’t Assume They Know All About You

It’s common for business owners to say to me “Our customer knows all about us, so we don’t need to write everything down.”. WRONG!

Beginners Guide to Pricing Tenders

As part of our tender consultancy service, I often discuss tender pricing strategies with clients. This beginners guide to pricing tenders covers the most common topics we talk about when aiming for the winning bid.

You know your business, its costs, competitive pricing and your competition – if you don’t, act now! I cannot tell you what will be the winning price. But this guide to pricing tenders explains some the most important issues when bidding to win a tender.

Beginners Guide to Pricing Tenders

Beginners Guide to Pricing Tenders

General Pricing Strategy

Tenders almost always have price as part of their evaluation (see MEAT below). So, you must ensure that your company’s pricing is competitive in your market sector.

When undertaking a sales and marketing review with a client, pricing strategies are always on the agenda (part of the Marketing Mix). This is a much bigger topic than pricing tenders and is too broad to cover properly in this post but let’s look at some of the basics:

There are three elements to a price:

  1. Direct Costs are the specific costs incurred to provide the product or service e.g. staff, materials / sub-contractors and supervision
  2. Indirect Costs include premises, management, professional fees, administration etc.
  3. Profit is the difference between the selling price and (1) & (2)

How to Write Positive Tender Responses

Writing positive tender responses will help you maximise the impact of your bids. A positive tone will shine through – as will any negativity. Therefore, you want to ensure that you avoid sounding negative and always be positive. You will appear confident and so encourage the markers to read your tender in an affirmative way. Hopefully leading to higher scores and therefore a win! This article explains 3 simple techniques that will help you achieve the right tone.

How to Write Positive Tender Responses

Answering Tender Questions to Score High Marks explains how to use the right language and style when answering tender questions. This includes:

  • Using benefits
  • Correct, complete and succinct writing
  • Writing in terms of ‘them’
  • Using the second or third person
  • Supporting evidence
  • Differentiating from the competition

We are now going to add some more subtle aspects to this ‘to do’ list by showing you how to write positive tender responses.

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