What is Tendering?
What is tendering and how can it help your business grow?
What is tendering? The question a lot of people ask when growing their business.
It’s become clear to us that not every person who starts their own business understands this largely time-consuming process. Initial business growth will undoubtedly focus on other streams such as networking, business clubs, marketing and outbound sales etc.
And, of course, we understand why: those are all key elements of growing a successful business. But so is tendering.
There’s a common misconception that tendering is only viable for bigger companies. But that’s simply not the case! Tendering can work wonders for many SMEs looking to expand their business. It’s an excellent opportunity to collaborate with bigger companies and improve your chances of success. For example, via a framework agreement.
It may seem like a difficult process, but tendering is a great way to win contracts for your company. By tendering for opportunities, you could increase your company’s profits year after year. Why not take advantage of this excellent opportunity?
If you don’t take advantage of tendering, your company could be missing out on opportunities for business (and profit!) growth. Instead, other companies in your sector could be winning key contracts that would be hugely beneficial for your business.
Whether you’re a huge corporation or just starting out, we want to help you grow your business.
For that reason, we’re going to break down the question for you: what is tendering?
What is it?
The simplest answer to the question ‘what is tendering’ is that tendering is a formal bid for a work contract.
Tendering is an approach which is ultimately deemed the best way of sourcing or procuring works, goods or services.
In the UK, tendering is part of the wider procurement process. The process is facilitated by buyers who engage and purchase from prospective suppliers.
Typically, UK public sector organisations, such as local authorities, government departments, and the NHS, comply with the Public Sector Regulations. This demonstrates a fair way of purchasing with spending public purse – i.e., our tax money.
Tendering ensures that the bidding process is completely fair by increasing transparency. The main factors considered when a buyer evaluates a tender are:
- Cost of the work
- Quality of your tender responses.
The process of tendering allows buyers to select the supplier whose services are the best value for money.
How does it work?
Now that we’ve answered the question, ‘what is tendering’, you might be asking yourself, how exactly does tendering work?
The publication of a tender opportunity is typically regarded as an invitation for suppliers to bid for the contract.
1. Find the right tender for your business
When you’re searching for tender opportunities, you should only progress with contracts that are realistic for your business. There’s no use in spending your company’s time and resources on a tender you aren’t qualified for.
There may be certain expectations or requirements that your business must fulfil before you can proceed with the tendering process. This typically depends on your sector. It’s important, therefore, that you read through the entire specification before you start preparing your tender response. You don’t want to spend time on a bid and realise too late that you can’t meet the buyer’s criteria.
2. Produce your response
When tendering for work, your business will be asked to submit a combination of pricing and responses to quality questions. This is your opportunity to show the buyer why your business should win the contract.
The tender documents outline exactly:
- Buyer requirements
- Budgets available
- Timescales involved
- Response requirements.
It’s then up to a supplier of the specific goods or services to respond to the contract. Usually, this is done via a written proposal and a suitable cost or quote to undergo the works at hand.
Your responses should be compelling, persuasive and well-researched. Make sure that you answer the buyer’s questions in full: this is a great opportunity to market your company!
3. The buyer’s evaluation
After submitting your response, it’s out of your control. The buyer will then perform an evaluation of quality and cost. At this stage, the buyer will assess each bid to find the most suitable supplier for their contract. They’ll be looking for the supplier that offers the best value for money.
If you’re searching for an answer to the question, ‘what is tendering’, then chances are you’ve never heard of MEAT.
Buyers choose the ‘Most Economically Advantageous Tender’ (MEAT) for their contract. This means that they’re not selecting the supplier through cost alone. Instead, the buyer assesses which business will provide the best work and offers the best value for the lowest price. This encourages suppliers to maintain competitive pricing but prevents companies from depending on their low prices alone to win contracts.
The entire process, from the tender’s publication to the submission of your response, usually takes around 4-weeks. However, this can vary depending on your company’s sector and the buyer’s needs.
This tendering process is designed to maximise transparency in the evaluation procedure. The winning supplier is selected fairly in an open, honest, objective and neutral selection process.
This allows the buyer to maximise their expenditure. They can be sure that they’re receiving true value for money with an affordable and skilled supplier.
Is this just the public sector or does this apply to the private sector too?
Much of the information on tendering is directed at public sector companies. However, if you’re part of the private sector, or looking for private sector contracts, you might ask, what is tendering? And can it benefit my business too?
The answer is yes.
A lot of businesses and other private organisations have recognised the benefits of the tendering process. Suppliers are forced to remain competitive with their pricing, and maintain minimum competency levels in their responses prior to consideration.
Tendering in the private sector works much the same as it does in the public sector. However, there are some key differences.
Companies in the private sector are not bound by the same obligations as those in the public sector, i.e., transparency. Private sector organisations can choose whichever supplier they like, for whatever reason. So, unlike public organisations, companies in the private sector can choose the cheapest supplier, irrespective of quality.
It’s also worth noting that private organisations aren’t required to publish tendering opportunities. Therefore, it can be difficult to search for private tenders online. A lot of private sector tendering relies on networking and business connections.
Succeed with Hudson
So, we’ve answered the question, ‘what is tendering?’
Now your next question for us might be, ‘how can you help my business?’
The tendering process relies on fairness, openness, and transparency, and only the most capable and competent suppliers are selected.
Want to learn more about tendering? You can watch a whole range of free videos here on Tender VLE, the UK’s first virtual learning environment.
We’ve covered various topics relating to procurement and tendering, making it easier for you to succeed. We offer five levels of training to accommodate everyone, from complete beginners to seasoned experts. Tender VLE can help you every step of the way.
We have a dedicated team of consultants on hand to support you with various services. Find out more by contacting a member of our expert team. Get in touch to find new tender opportunities, for further support, or to pitch us new topics to cover!
Need help writing a tender?
Our parent company, Hudson Succeed, is a global provider of bid writing services.
We have an 87% success rate and over 60 years of collective bid writing experience. Our team can support you with every step of the tendering process. Our services include:
This 4-week programme is designed for companies that are completely new to the tendering process. One of our highly skilled Bid Writers will work alongside you, ensuring that your business is ready to tender successfully.
Our Tender Improvement programme is designed for companies that have previous experience with tendering but are yet to see results. A member of our team will review your previous tender responses and help you improve them for future tender opportunities.
Our Tender Writing service really is the whole package. Once we have the required information from you, our Bid Writing Team will take care of the rest. We’ll take charge of the entire tender for your business, from writing through to submission.
This package is suitable for companies that have already written their own tender response. A member of our team will proofread your work before the submission deadline, checking for inconsistencies, grammar or spelling errors. At your request, we will also check your responses to ensure they meet the contract’s specifications.
Get in touch with a member of our expert Bid Writing Team and watch your business grow.
Upgrade to Discover Elite
Enhance your tendering experience with Discover Elite.
The package ensures that you can still identify tendering opportunities even when you’re busy. Forget pre-bid admin and time-consuming breakdowns, your Account Manager will take care of this for you. Get in touch for more information.