Winning Bids in the Utilities Sector

Although we will focus on how retail utility services, gas, electricity and water, can win bids in the Public Sector, the principles of this article are relevant to all industry and commercial sectors. What is crucial to remember is that the key steps in the bidding process remain consistent.

Assessing the opportunity to support the bid/no bid decision
Assess what the opportunity requires and what it offers to decide whether you will invest in the tendering process. Consider:
• Relevance to your business?
• Winnability?
• How competitive will it be (number of bidders)?
• Potential for further business?
• Is it a single award or a framework?

For frameworks consider:
• How will call-offs be made?
• Work volume generated?
• Is the framework new or existing?
• If existing, what spend has been awarded and to who?
• As a energy/water retailer are you required to promote the framework or encourage customers to use the framework?

Evaluating the client’s requirements to inform on your bid approach
Consider the criteria and understand the client requirements and scoring mechanism. The weighting of Price vs. Quality is important. A higher Quality score equates to requiring a high-level delivery of excellent services whereas a higher Price percentage indicates wanting a cheaper value solution.
Public Sector often specifies a mix of Price and Quality explained as ‘MEAT’ – Most Economically Advantageous Tender
However, the lowest priced bid is typically awarded full marks on the available Price score but the highest scoring bid for Quality typically scores only part of the available Quality marks, this means Price has a disproportionate effect on the outcome.
Your sales team’s relationship with the client can add enormous value with customer intelligence and insight on priorities and what they are really looking for as a business and from a supplier.

Interrogating the Terms and Conditions
Ideally, clients will use the terms and conditions you have designed for your services, however, most public sector organisations will require you to sign to their terms and conditions. It is essential to examine them and obtain legal assistance where necessary to fully understand all of the clauses and their potential ramifications for your business.
Typically, T&C’s questions can only be asked during the clarification period, before submitting your bid. The scope for variations may be limited but where permissible demonstrate an understanding of why they wanted that particular clause and ensure your counter-proposal still meets their requirements while better matching your own needs.

Understanding the Pricing Matrix and the importance of Clarifications
Rigorously test the pricing matrix to ensure you understand how it will be scored and identify any anomalies that could create an unfair result. Use the clarification window to raise any irregularities to ensure a level playing field for all bidders.
Ask the buyer to specifically clarify requirements so that all bidders price for the same elements and level of quality on a like-for-like basis. This means no-one can substitute inferior specification options or omit core services. When everyone has the same detailed specification and can price accordingly this makes losing out on Price less of a risk and puts a greater focus on quality and technical skill.
Confirm any e-auctions in the process, this is where you submit a competitive price initially but retain margin to drop further in the online auction. It is important to set yourself a floor price and stick to it so that you do not end up going too low and not retaining sufficient margin to make a profit.

Approaching the Qualification Stage
• Relevant licences? Ensure you hold the relevant licenses, allowing your company to conduct business within a geographical location or specific industry area. For UK-wide bids multiple licences may be required.
• Relevant evidence? Ensure you have relevant reference contracts and client case studies that match the bid requirements closely. Named client references may be required.
Buyers may want to contact your existing clients. Prepare your reference client so they understand what is required and assure them their own service delivery will not be impacted should you win new business.
• Required accreditations? Typically requested are:
ISO 9001 (Quality)
ISO 14001 (Environment)
ISO 45001 (Occupational Health and Safety)
Cyber security is increasingly vital, especially in the Public Sector which is risk adverse and keen to avoid data breaches. Cyber Essentials or Cyber Essentials Plus is already mandatory in most bids and also becoming expected as standard is ISO 27001 (Information Security Management).
Holding certifications can automatically passport bidders through some of the qualification elements and at times secure vital points in bids. This can allow you to bypass lengthy additional questions or to have to supply supporting materials such as policies, procedures and processes.

Demonstrating strengths within your Technical/Quality response
The public sector always requires savings and offerings that provide more than their existing product/service. It is essential to demonstrate your strengths and skills, supported by evidence which is verified and quantified.
Key areas include:
• Value for Money – affordable, better services than the incumbent.
• Faster – swift service/support times and, one of the most important areas within retail utility services – a smooth and accurate billing service. Evidence this with KPI data gathered from current contracts.
• Safe – evidence your H&S focus, especially in areas of direct involvement with energy services, electricity, water and gas. With concerns for service continuity during Covid-19 detail your arrangements for worker safety, appropriate social distancing, PPE and contingency for absences or further lockdowns.
• Sustainability – demonstrate your Net Zero Carbon agenda and evidence efficiency savings. Explain how you work with clients to achieve behavioural change and evidence where you have tackled complex or difficult areas.
• Smooth Operator – assurance is needed that switching to your services will be a managed transition and seamlessly integrated with their own systems.
• Great Relationships – Wholesalers are often key to resolving issues so evidence strong relationships, especially when operating in multiple areas. Map your proven track record for excellent customer service and include your complaint procedure and escalation process. Explain why working with you is good for the client, their employees, service-users, end-users, local communities and stakeholders.
• Call Centre Arrangements – highlight your teams experience and how you engage, reward and train them. Outline working conditions and fair working practices – equality diversity, inclusion, flexible working and resource planning so client services are consistent.
• Ancillary Services – show how energy and water efficiency savings be achieved through innovation and initiatives. Outline your success to date with case studies to build credibility. Detail measurement and verification arrangements.
• Social Value – many contracts have social value provisions as a legal requirement. A compelling story is needed for how you and the client can make a difference, especially in their locality, by creating new jobs, work placements and community engagement with pro-bono volunteering and local project support. This can be tied to contract spend thresholds for increasing benefits for local organisations.

Using different perspectives to review the bid
Once the bid draft is complete have it reviewed by colleagues with different perspectives. Consider:
• Does the bid fully meet the requirements and how good a service is it for the public sector organisation?
• How are end users effected by the service?
• Is it commercially and financially viable?
• Is your environmental and sustainability story compelling?
• Are the KPIs as strong and believable as they can be?

Using External Bid Specialists
External consultants can assist across a range of areas with specific support such as running the initial bid kick off and solution development workshop, developing your USPs and client hot buttons into win themes, reviewing your draft bid or handling the process end-t