Construction Contract Tender Tips for SMEs
Here are some tips on construction contract tender for SMEs (Small to Medium Enterprises):
1. Check and double check
The public procurement process is rigorous and states it is imperative for suppliers to ensure they can meet the needs of the procurer. You should be diligent in meeting the requirements of the client and your proposal should demonstrate this in detail.
2. Be innovative
The government acknowledges that new products can possibly be better value for money than traditional ones that have been trialled. Therefore a result-based approach to procurement over the traditional cost-effective single solution approach is being adapted. As an SME you have the potential to provide value for money and innovative solutions. However it is important that you okay it with the client to propose your innovative solution to them and ensure that it will not be perceived as a risk.
3. Acknowledge and prevent risk
As an SME you need to present yourself as an expert in your specific field by reassuring the client that you have identified and combated potential risks. You are more likely to succeed in winning a bid in the public sector if you can decrease the risk factor.
4. Link responses to criteria
The majority of public sector contracts have two stages; tender selection and tender evaluation. The criteria for both of these stages will be stated in the original notice or invitation to tender documentation. Analyse the weighting given to each criteria and coordinate your responses proportionately to this.
5. Involve a Bid Writer
Using a specialist public sector bid writer who understands the construction procurement process, construction estimate and how to propose a successful bid can be beneficial. At first this may seem costly but it will increase your chance of winning and provide you with the skills you need to learn for future bids.
6. Stick to the price
Your tender competitors will have similar skills to achieve the technical requirements of the tender, so you need to be able to consider other factors. Price can become rapidly important in a situation such as this, if your price is weighted 25% or above then there is a lower chance of you succeeding unless you are the lowest price out of all tenders.
7. Acknowledge the debrief
You will most likely lose tenders before winning them; however it is imperative to not repeat the same mistakes. To increase your tender knowledge it is beneficial to seek information for the authority when you have been unsuccessful to decipher why you were not selected or unsuccessful at the invitation to tender stage. If the winning tender offered a higher price you have a right to ask what the winning bid was and why it was better than yours. Even if you do win, attending the de-brief will display how your bid was stronger and identify competitor’s areas of weakness for you to learn.
8. Consider subcontracting
Public bodies are increasingly hiring large firms who offer suppliers contract work. SMEs can gain public sector revenue quicker by acting as a subcontractor to bigger private sector organisations. This also provides you with a useful and impressive reference should you still want to work for the public sector.
9. Think about framework contracts
Getting onto a framework agreement can provide many relevant opportunities and is a useful way of identifying your industry competitors. If a framework contract is secured then you have access to who has been successful in the framework and identifying companies you may or may not know.
10. Surpass expectations
To improve the chance of contract renewal once you have won a contract, you should aim to meet and surpass the expectations of the client. You need to make the client feel that you are their partner and have the same goals as them for the requirement. You want to fill them with confidence that you are the expert on construction projects.
Overall, it is important to go through the tender process with existing knowledge and the willingness to expand that. After going through a few tenders you will get the hang of it and be able to identify your strengths and weaknesses.
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