A great deal of time and hard work goes into preparing a tender. There are a lot of businesses which rely on these as their source of profit for their company. Some companies struggle with obtaining wins on their tenders. There is a basic structure that is usually followed when preparing the tenders.
Each entity which is accepting tenders will have its own format requirements, but the basics for these are usually very similar. What is very important when it comes to tenders, is making sure they are submitted by the deadline. In most cases, tenders will not be accepted if they are late.
Although the tenders all have the same basic components, those submitting them are going to be up against some competition. It is worth taking the time to prepare the tender properly. The big factor for most when submitting a tender is to come up with the price. This is going to be one of the major deciding factors when the tenders are being reviewed. Once the price has been set, there is no room for negotiation after the closing of the tender. Another important factor which will be considered is the ability of the company providing the tender to complete the job.
The preparation for submitting a tender is the most important part of the tendering process. It starts by first analyzing the bid documents. What has to be determined is:
- Does the company have the skills and experience needed to complete the bid project?
- What are the cost factors involved in preparing the tender?
- Does the company have the time and resources to complete the project outlined in the bid?
A full and accurate estimate of the costs to complete the project has to be determined. This will help to decide whether there is going to be a profit margin.
Understanding Government Tenders
A lot of companies prefer to go after government tenders. The government has a stringent mandate to follow when it comes to tenders. The contracts cannot be awarded based on factors such as:
- Favoring a specific company
- On ethnicity
- Unfair processes
Once a tender has been submitted, it will go through a review process. The tenders are allocated points, and the tender with the highest points is the company which will receive the contract.
The tender is a legally binding contract. If it is accepted as the winning tender, then the provider of it is now responsible for filling all of the obligations, as they have promised. For example, the price and the time outline.
Tenders have to be prepared very carefully. They cannot be developed with the idea of just winning the bid. If there is no profit margin, then it serves the company no purpose, other than perhaps gaining recognition for contracts which have been successfully completed. Another reason is that a tender is a legal contract.
Companies which take their time with tenders are much more successful at winning them.