We’ve all been there… A tender for a big contract is published and you really want to win it, but you’re up to your eyeballs in work as it is, or some of your team are on holiday, or assigned to other business-critical projects.
So, what now?
Do you just leave it, because you don’t have enough resources to put a strong bid together – too much effort, hassle, stress… and ultimately no guarantee of a winning result?
Needless to say, you’ll certainly not win any contracts taking this approach. What’s worse is that by taking such a short-term view, you immediately forego the chance to bring in significant long-term revenue for your business – potentially millions of pounds.
Worse still, your competitors will have an easier ride to winning the contract, with one less horse in the race. So, whilst one of your business rivals strengthens their position in the market by landing a big contract with a long-term income stream, you miss out altogether.
The Continued Growth of Procurement…
Procurement as a business function has grown markedly over the last 20 years; as well as the increase in legislation and lowering of tendering thresholds, decreased public spending is forcing the public sector to scrutinise their costs forensically, including their supply chain expenditure.
A recent report in to NHS spending found that for every 1% saved in NHS England hospital trusts’ annual procurement expenditure, the NHS would save £220m a year – enough to pay for more than 4,000 extra junior doctors. A 5% reduction would save £1.1bn pa (or 20,000 extra junior doctors). With potential savings like this to be realised, it’s easy to see the value in a strong procurement function.
The private sector is also placing greater emphasis on its contracting arrangements, to ensure all supply chain expenditure represents best value and quality for its customers, clients and shareholders.
The Importance of Being ‘Bid Ready’
The reality of today’s contracting environment is that big contracts will almost always require a formal bid, proposal or tender response. As a result, the need to ensure you have resource ready to develop, price and submit your bids and proposals has never been more important.
There are various ways to plan your bidding function to ensure you have resource available when you need it. Larger organisations tend to have in-house bid teams, calling on external specialist advice and support for bid strategy, governance and external review, particularly for high value contracts.
Small to medium sized businesses typically have a few staff who handle bidding activity alongside their ‘day job’. These companies can bring in bidding specialists to provide additional resource during periods of increased bid activity, or for large ‘must-win’ contracts.
Many small and micro businesses do not have any of their staff working on bidding at all, preferring to focus on delivering the work they know and do well. Instead, many will outsource their entire bid function to bid experts, to ensure they can focus on their customers and clients, whilst continuing their growth.
One size doesn’t fit all
What’s important is to recognise the model that works best for your business and to ensure you avoid making a no-bid decision on a contract you want (or need!) to win, simply because you don’t have the resource in house to pull together a strong bid in the time available.
For some contracts, the opportunity to win new business and secure a reliable long term revenue stream will be well worth the strategic planning and investment in bid expertise.