How Young Entrepreneurs can Participate in Government Tenders ?
A company that stays on the alert for tender notices for any contracts which it can profitably fulfill can discover this to be a valuable addition, if not a complete replacement, to its other customer acquisition strategies. Some of the biggest and most lucrative contracts, the kind which can forever change the fortunes of a business and its owners, can only be obtained through tender bidding processes. It is then obvious that if you are a business owner (or run a supplier operation such as a farm) knowing the ABCs of applying for tenders can greatly improve your chances of success.
Smaller organizations make tests for tenders which can be applied in the most basic of manners. In such cases a quotation for the job and/or a letter arguing why it should be given to you is usually enough—, if the business is small enough, a standard application may scare it off. Formal tender applications are needed for bigger jobs or for supply contracts that are spread over long periods. Public-sector work, in particular, has very specific tendering processes and requirements.
Also Read: United Nations Global Market Place
Requirements for government tenders
In South Africa, some of the general requirements for applying for public-sector tenders are as follows:
- A company profile
- Your company’s certificate of incorporation
- Registration with the South Africa Revenue Authority
- Certified financial statements
- At least three copies of the tender, documents with the original marked, bound, and sealed.
- Personnel and equipment capabilities
- Registration with the SPB (State Procurement Board)
- Have the truant accreditations and qualifications that the tender you are interested in requires
While the requirements on the list above only apply to tenders put out by the government and any of its various entities, these rules should serve you well even when applying for private-sector jobs. Since the government is one of the strictest organizations which you can do business with (at least on paper), acquainting yourself with its tender processes and requirements is a great start to you knowing how to apply for tenders more professionally.
If you are interested in government tenders, you can look out for notices which are usually published in newspapers, tv, radio and websites online. Government tender information is also published through the government gazette.
Information about private sector tenders is also published through local and national newspapers—usually the actual paper versions, not the websites. Building contracts in companies that are potential clients or networking, as it is more popularly known, should also help you discover new tenders.
Announcements are also made through corporate and organizational websites which you can keep an eye on through regular internet searches using the right sets of keywords. Remember that despite all its usefulness, waiting to hear about contracts through the grapevine that is social media is rarely a good idea as this information will often reach you too late and you should avoid the practice of applying for tenders in the last-minute rush.
Look out for timewasters
Preparing for tenders can be time-consuming, and costly and tie up valuable company resources and manpower all of which are irrecoverable. I won’t go so far as to say that any of the contracts which you apply for and end up not getting would have been a waste of time—because the truth is the exact opposite—but you should still assess if some contracts are worth bidding on. First, assure yourself that the client is serious and that you are not there just to test the market or, even worse, just respond to a bid put out by a competitor who wants to know how everyone else is pricing. You can skip this with established and reputable organizations.
Always seek clarity when necessary
You must understand the requirements, terms, and conditions of the tender before you start applying. If possible, try to get a meeting or a telephone conversation with the potential client if you require any clarifications and elaborations about the tender—this is extremely important if you are trying to win mainly on pricing (which is not always a good idea) as any misunderstanding can cost you and take a big chunk out of your profit.
Thoroughly read bid documents
Get hold of the bid documents and analyze them, making sure you can match the technical, skill, and experience requirements. While the last one, can cautiously be overlooked as every company has to start somewhere, the first two are very important requirements.
Do not lean too much on pricing
Remember that price is important but it is not the only factor taken into account when deciding to whom to award the contract. Stating abnormally lower prices than other bidders will just invite suspicion and more scrutiny. When applying, you should instead demonstrate value for money and your competitive advantages. Address each of the tender criteria in turn and emphasize where you exceed the requirements.
Put your regular clients first
Not all companies depend on contracts alone. Being awarded a contract should not affect your relationship with your current customers, as you would most likely need them again in the future. Assessing how the contract would affect your other work, staffing, and ability to take on other new business is therefore very important.
What to put in your tender application
Make sure that your company and the products or services it provides match the bid specifications. Do not be an opportunist and try to shoehorn yourself into an unfamiliar line of business. Botched jobs can significantly cost you in the long run.
Focus on the client
In your bid, mainly focus on the client and not yourself. A bid that addresses the client’s needs shows that you understand their requirements. When you talk about yourself, it should be just to show how your company is best suited for that particular job. State your experience, qualifications, accreditations, past clients, etc.
Offer value for, money
State how you differ from your competitors; list what you consider to be your competitive edges and whatever else that can offer that the client will that valuable e.g. reliability and lower lifetime costs of your products, structures, or installations.
It is also important that you show that you have the resources to do the required work in a cost-effective way to meet the client’s needs, the deadlines and respond flexibly to changing situations.
Provide details about your team
Emphasize the strengths of your core team members. State their qualifications, experience, and highlight their successes on past projects, particularly ones similar to that which you are currently bidding.
Put yourself in your client’s shoes
One useful rule is that you should always try to place yourself in the shoes of your prospective client and then address as many of the questions and concern that you would ask if you were them.
Written By: Arnold Mutamiri