If your business is looking to start tendering for public sector contracts to help grow and expand, this quick guide to tendering may be useful. It will briefly take you through what a tender is, what the process involves, and the benefits it can bring to your business.
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What are tenders
When we talk about tenders in business and the procurement industry, we are usually talking about the opportunities for contracts published by various public sector organizations for services, goods, and utilities.
The process requires that an Invitation to Tender is made available to generate competing offers for whatever it is that the public sector organization needs. You can look for government contracts analysis to find out what is being offered and decide whether any are appropriate for you. These calls for bids take different structured forms – open tenders and restricted tenders – but basically, they will set out details of what the public sector body wants and needs.
What is the process?
There are four different procurement procedures used to give contracts in the tendering process. These are:
Open procedure: the interested parties are invited to submit their tenders by a specified date. These are then looked at in detail, and a contract is given to the winning party or parties.
Restricted procedure: this involves two stages. The first stage consists of identifying a short list of suppliers, usually involving a Pre-Qualification Questionnaire. In the next step, the suppliers who have been identified are then invited to submit their tender, and they are evaluated and awarded as appropriate.
Competitive Dialogue procedure: this process is used for more complex needs. Following the notice for tenders, the awarding body then works with companies to come up with some suitable solutions, which is then followed by an Invitation to Tender and contract award. This usually happens when a public sector organization knows the outcome they want, but not how they will achieve it.
Negotiated procedure: This is the least common of the four, and is used when a public sector organization enters into negotiations with multiple suppliers.
What are the benefits of winning a tender for your business?
£700 billion a year is spent by the UK Government, making them one of the largest purchasers in the UK in specific industries. Tenders are the only way to get a foot into some of this business.
There are other benefits to having the government as your customer, such as:
Stability: You can rest assured that a public sector organization is not suddenly going to go bust owing money to suppliers
Payment terms are, in the whole, more favourable, and are better honoured than those in the private sector.
Generally speaking, procuring a public sector contract can provide your business with some high quality and financially rewarding business opportunities, leading to further growth and opportunity in the future. If you can offer a service to the government, it is well worth taking into consideration!
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