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10 things you must know in order to win public sector tenders

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By The Drum Team, Editorial

February 11, 2011 | 8 min read

Despite all the talk of public sector cuts there is still a lot of business to be had in this market. Law firm Biggart Baillie has drawn up a list of 10 things you must do to succeed on the tender trail.

Bidding for public contracts can be quite a different experience than bidding for private contracts. There’s often a convoluted process to be followed, strict bidding deadlines to be met and a mountain of paperwork to be filled in: and that’s before you even get the chance to bid! But the good news is that there’s a wealth of contract opportunities out there for SME’s in the Creative Industries. Here’s how to get started:-

1) Learn to recognise a “contracting authority” when you see it

There’s a whole world of public contracts out there. You (yes, you) can bid for them.

The Public Contracts (Scotland) Regulations 2006 (the “Procurement Rules”) apply only to certain public bodies such as Government bodies, local authorities and other bodies financed from public funds. A similar set of rules apply to Utilities, such as Scottish Power, Scottish Water and the like. Provided the value of the contract is high enough, these bodies are required to advertise their contract opportunities and follow a prescribed procedure for awarding the contract.

2) Know the “Thresholds”

They won’t have to advertise for a packet of paperclips, but they will for a 1,000,000 packets of paperclips!

The procurement rules only fully apply to contracts above certain financial “Thresholds”. If the contract is for the supply of goods or services, the applicable Threshold is generally £156,442 (although it can be £101,323 for certain Central Government bodies).

However, Scottish Government Guidance says that contracting authorities should still advertise and follow some sort of fair and open procurement process for any contract with a value exceeding £50,000. Remember this figure relates to the overall value of the contract, not the annual value. So, for example, a contract with an annual value of £45,000 per year for 4 years will be above the Threshold.

3) Learn the lingo

Parle vous procurement? There are many firms (including law firms) that offer training courses or seminars in procurement. Sign up for a class today.

Procurement isn’t a foreign country, but it definitely has its own lingo. By now you should know what a “contracting authority” is and why the “Thresholds” are important, but other terms and acronyms abound. For example:

Contracts above the Thresholds need to be advertised in the Official Journal of the Europe Union (“OJEU”);

The “OJEU Notice” or “Contract Notice” is the document that the contracting authority sends to the OJEU to start the process. It’s basically an advert for the contract opportunity, providing basic information about the contract and where you can get further details;

Often would be bidders are asked to fill out a Pre Qualification Questionnaire (“PQQ”) to prove their financial stability and technical expertise;

Provided the bidder passes that first test, it will be sent the full Invitation to Tender document (“ITT”).

4) Know where to look for contract opportunities

Register your details online and the contract opportunities should come flooding in.

You don’t have to be a member of the Chief Executive’s Country Club to learn about upcoming contract opportunities. OK, so the OJEU doesn’t have the most user friendly website, but you can still make a start today by registering your details at the Public Contracts Scotland website at www.publiccontractsscotland.gov.uk. The service is free and you can sign up for alerts in the field of work that you are interested in.

There are also a number of private websites that collate and provide information on contract opportunities across Scotland, the UK and indeed the whole EU for a fee, such as BIP Solutions’ Tracker service.

5) Check your credit rating

Er… check your credit rating. What more can I say?

More and more contracting authorities are using credit reference agencies to decide whether a firm is financially stable enough to do business with. Check your credit rating regularly and resolve any issues before you tender. If you can’t resolve the issue, then offer the contracting authority an explanation – it’s obliged to take it into account.

6) Read the tender documents thoroughly

Every tender is different. Find out exactly what they’re looking for and sell it to them.

Read the PQQ and the ITT documents carefully. Understand the scoring system the contracting authority says it will use. Contracting authorities don’t always look for the cheapest provider. More often they look for the “most economically advantageous tender” (another lovely acronym: “MEAT”). The scoring system tells you how they will decide that. Structure your tender accordingly.

7) Don’t waste time arguing the contract should be awarded to you because you’re a local supplier

We’re in Europe these days. Deal with it.

The whole purpose of the Procurement Rules is to open up competition across the whole of the EU. Rather than waste your time complaining about this, you’d be better off directing your energies towards finding contract opportunities that you can bid for elsewhere in the EU.

8) Don’t be afraid to ask questions

There’s no such thing as a stupid question (just a stupid scoring system).

If there’s anything unclear in the PQQ and ITT, or you have any questions about the process: ask. In particular, if you think the scoring system is vague or unclear then ask the contracting authority for a detailed clarification. They have an obligation to run a fair, open and transparent process. Remember that the contracting authority will circulate the answers to these questions to all bidders.

9) Win or lose, ask for a Debrief

Learn from your mistakes.

If you are unsuccessful, then the contracting authority is required to give you information about “the characteristics and relative advantages of the successful tender” in the letter informing you that you didn’t win. In practice, this means a comparison between your score and the winner’s score. Most contracting authorities are also happy to meet with you to provide a debrief, or alternatively provide feedback over the telephone. That information can be invaluable for the next tender you participate in.

If you win, you should also ask for feedback. The information you get back may help you keep to your winning streak!

10) Don’t be afraid to complain…or challenge

It’s public money. You have a right to a fair chance at winning the work.

If you think something is not right about the tender process, and the debrief information provided doesn’t satisfied you, don’t be afraid to complain. It is a misconception that challengers won’t get any further business from the contracting authority, because contracting authorities are bound by the Procurement Rules to act fairly and proportionately. They can’t exclude you or mark you down on future tenders just because they no longer like you.

If you think the problem is serious enough (or the contract is important enough!) to consult a lawyer, then do so immediately – don’t wait for the debrief! Contracting authorities have to implement a “standstill period” of between 10 and 15 days before they can sign the contract with the winning bidder. That’s a short window of opportunity to prevent the contract being signed. If you’re too late to stop the contract being signed then, except in very limited circumstances, you won’t be able overturn the contract award decision. However, you can still sue the contracting authority for the profits you lost because you didn’t get a fair chance to win the contract. Even then, there is an unusually tight time bar for raising procurement actions (generally 3 months).

If you don’t want to go to Court, the Scottish Procurement Directorate operates a scheme called the “Single Point of Enquiry” for complaints, but it has no powers to order contracts to be overturned, impose fines or award damages.

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