Understanding Public Sector Tenders

4 minutes of reading

Understanding public sector tenders follows on from Why do Companies Tender – so do read that first to get to grips with the reasons for tendering.

The Dynamics of Public Sector Tenders

Councils, central government, NHS, housing associations and the rest of the public sector (or publicly funded organisations) will all go to tender for the same reasons set out in Why Companies Tender. However, there are two drivers that are specific to public sector tenders:

  1. They are spending public money
  2. Government wants to ensure that laws, policies and initiatives are met
Understanding Public Sector Tenders

They are Spending Our Money

It must be remembered that public sector tenders are used to make purchases using our money. As tax payers we all want to see that our money is spent wisely, therefore  the public sector use a robust tendering process to help ensure that good procurement procedures are used.

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Why do Companies Tender?

3 minutes of reading

Why Do Public Sector Organisations & Private Companies Tender Contracts?

The tendering process can be very frustrating. Sometimes, you may feel that companies use tenders just to annoy you! However, there are some simple reasons and it is very useful to understand why companies tender.

The previous post Tender Procurement Process explains the various steps that form a typical tender. It helps put the following points into perspective.

Why do Companies Tender?

Best Performer Wins

Tendering involves a competition where several potential suppliers compete against a set of criteria including:

  • Specification or requirement
  • Quality
  • Price

These are measured so the best scoring bidder(s) wins the contract.

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Why do Companies Tender? Read More »

Tender Process & Procurement – Tendering Process Explained

5 minutes of reading

This guide to the tender process and procurement draws together many previous posts to provide a full understanding of the tendering process. Hopefully, it will help you to be more successful with your tender bids!

The Stages of the Tender Process

The chart below shows the various steps that form a typical tendering process for a large contract. Smaller value contracts may be simpler.

Tender Process & Procurement - Tendering Process Explained

Form Procurement Team

The procurement team will typically involve:

  • Procurement
  • The budget holder
  • Others involved in managing the contract
  • Possibly representatives from health and safety, human resources, quality management etc.

TIP: The higher the value of the contract, the bigger the procurement team – often involving senior management. Also, the tendering process becomes more drawn out. The same applies to high-profile purchases.

For example, a very high-value contract, or one that involves contracting out for the first time, will often involve a large team (including directors). And it will have a full tender process (as shown in the chart). Conversely, smaller contracts may have a much simpler tender procurement process. You see this in the public sector. Higher value contracts must be advertised. Smaller jobs can be let via a mini-tender.

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The Importance of Relationships When Tendering

3 minutes of reading

In its simplest terms, tendering is a formalised process for buying and selling. Everyone knows how much a good business relationship can help improve your chances of success when selling. But due to the formality of tenders, it can be difficult to even talk to someone once the tender is out – let alone build any decent relationships.

The Importance of Relationships When Tendering

Pre Tender Meetings (Tender Briefing Meetings) can be used to develop relationships during the tendering process. However, it should be your aim to start building relationships with your prospect well in advance of the tendering process.

Pre Tendering Relationships

Generally when selling higher value or more complex goods or services, you start trying to develop a relationship as part of the sales process; ideally you will have built a relationship before you try to make the sale. The reasons for this include:

  • Building trust
  • Understanding your prospect’s needs and problems
  • Your prospect gets to know your organisation’s abilities and benefits

Tenders are generally used for higher-value contracts. So, the same benefits of relationships that apply to selling can apply to tendering. Your relationship may also be able to influence the tendering process i.e. help the prospect in deciding what specification to tender for.

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