10 Steps to the electrical tender process
Tendering can have a large role to play when you’re in the electrical business, so understanding the electrical tender process is a key to success.
A lot of electrical projects, both in the public and private sectors, are put out for tender – especially bigger, potentially lucrative projects. If you have the tendering process nailed, then you improve your chances of landing the projects you’d really like.
Here are Countfire’s 10 steps to finding success with the electrical tender process:
#1. Assess the suitability of the opportunity
The first step is to identify and assess tender opportunities. We wrote a piece recently about where to find electrical tender opportunities, including those for the public and private sectors.
One thing we stress is that it’s important to have a set of criteria for identifying suitable tenders to place bids on. Some people bid on everything that comes their way, but this is waste of time, both for your company and those awarding the tender. Not all tenders are a great fit for you, so having a process for filtering those opportunities is important.
#2. Register your interest
The next step is to register your interest, letting the buyer know that you’re interested in submitting a bid. The buyer then issues you with further documentation to proceed with bidding, usually in the form of a pre-qualification questionnaire (PQQ). Sometimes, no PQQ is issued and you will get an invitation to tender (ITT) instead.
As a general rule, work quickly to register your interest in a tender opportunity. This is because there will be a hard deadline for submissions and you want to give yourself as much time as possible to put your bid together.
Note: If you receive the PQQ or ITT and decide that the project really isn’t right for your company, you are under no obligation to proceed. It’s always worth feeding this back and maintaining good relationships for the future.
#3. Complete the pre-qualification questionnaire (PQQ)
The purpose of the PQQ is to narrow the field of applicants for the tender. Someone in the hiring company needs to read through all submissions, so it makes absolute sense that they don’t want to waste time reading through submissions from companies that don’t meet their minimum criteria.
Your job at this stage is to focus on completing the questionnaire and providing evidence to show that your company has the ability to take on the project. One thing to remember is that this is one of the first impressions the buyer has of your company. It definitely makes sense to work on making a positive impact – while this is separate from the stage where the buyer reviews bids, their impression of you at the PQQ stage may carry through.
#4. Receive invitation to tender (ITT)
The invitation to tender (ITT) may also be known as a request for proposal (RFP) or request for tender (RFT). While the PQQ focused on why you are qualified and what you have done, the ITT is your proposal for what you will do on the project.
This is a very competitive process. It’s important to write compellingly and answer all questions that have been asked, but also to consider any “extras” that make you a better value proposition. How will you stand out from the crowd?It’s important that your tender is written compellingly - how will you stand out? Click To Tweet
#6. Seek clarification of tender requirements
Thorough research is a key component of tendering success. Assumptions may lead to costly bidding errors and it’s always important to understand the overall context and preferences of the organisation awarding the tender.
Sometimes construction documents are clear and totally unambiguous, but not often! This is where it’s important to seek clarification and ensure you can give an accurate estimate, or put some conditions on the tender where clarification isn’t yet possible.
The Request for Information (RFI) is the mechanism for clarifying the tender requirements. The goal is to resolve any gaps, ambiguities or conflicts during the bidding process.
#7. Understand the tender rules
Always read over the specification for the tender and understand what the organisation is asking you to put together. Guidelines are often very specific, detailing font type, size, word count and other formatting requests.
Of course, one of the most important “rules” to note is the tender deadline! Submitting a tender late is usually a great way to ensure that you’re not awarded the project. Meanwhile, how much time, money or resources were invested in putting the tender together?
#8. Check you’ve included everything they ask for
Tender submissions are often quickly ruled out when they’ve been submitted without key information included. Compliance tends to be a very important requirement for both public and private sector organisations.
Being compliant includes:
- Meeting all the points listed in the specification
- Possessing and including all necessary accreditations, licenses or qualifications
- Having necessary policies and procedures in place. For example, meeting duties under health and safety laws
- Meeting all turnover requirements
- Having and demonstrating relevant prior experience
It’s best practice to ensure you’ve included relevant evidence with your submission, such as copies of accreditations or verifiable examples of past projects. This can help to put your submission higher up the list than companies who don’t include evidence.
Another best practice is to have someone check over or quality control your bid before it is submitted. If you can, a fresh set of eyes often helps.
As an added bonus, if you can demonstrate added value in some way, this helps to lend weight to your submission. For example, you might be planning on hiring local subcontractors or electricians for your team, or you might have some experience or accreditation that goes the extra mile for the project.
#9. Evaluation and tender selection
Once bids are submitted, the buyer will use their internal system to evaluate and shortlist bids. They may select a company right away, but more commonly they will go back to those they’ve shortlisted and invite them to present their bid (especially for high value contracts). You need to be prepared to give a compelling presentation!
Some organisations, especially those in the public sector, have information documented about how they evaluate and select tenders, so it’s worth checking if this applies in your case.
In most cases, price is a consideration, but it’s often not the most important factor. Tenders tend to be evaluated over a few different criteria, including things like quality, social issues, relevant experience, service or even environmental factors. Many organisations use a scorecard system to weigh their different criteria. In some cases, you will get to see this once the tender has been awarded so that you know how you stacked up among the competition.
#10. Notification and agreement for electrical project
At this stage, you may be awarded the tender if your bid comes out on top. If that’s the case, you sign contracts and can prepare to get started on the project.
If you’re not awarded the tender, it’s always a good idea to ask for feedback. You may learn something valuable about what you need to improve upon, or gain relevant experience (which could have made your competitor’s bid stronger). You won’t always get the feedback, but it’s worth asking.
Store away any information you gather to aid you in producing a better bid next time. A losing bid doesn’t have to be a complete loss, if you learned something of value.
The tender process can be daunting, especially where your company relies on being awarded tenders for a lot of your work. It’s important to strike a good balance between prompt delivery of your bid and creating a thorough, quality submission.
If preparing tenders isn’t your usual specialty, you may be able to find a specialist company to help you with the tender process. It’s worth ensuring that you’re creating the best impression!
Every tender opportunity is a learning experience … regardless of the outcome. And it’s through consistent practice that you become an expert at both the process and winning tenders
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