10 Jul How Buyers Evaluate Your Bids
To understand how to effectively plan and write your bids, you should have a thorough understanding of how your buyers will evaluate the proposals they receive.
This will inform how you should structure your bid, and prevent you from wasting valuable time and resources on areas of a bid that carry a lower priority.
In this article, we will explore how bid documents are structured and evaluated against marking criteria, and outline how you can use this information to write winning bids for work.
How Are Bid Documents Structured?
There are two stages to submitting your bid proposal: Stage 1 is the Pre-Qualification Questionnaire (PQQ), and Stage 2 is the Invitation To Tender (ITT).
The Pre-Qualification Questionnaire focuses on establishing whether your business is suitable for the contract being bid on. You will be required to submit information regarding your company’s compliance status, insurance details, finances, qualifications and training, staffing capacity, quality assurance, customer care, and service levels – among any other areas that are important to your buyer.
You will also be required to self-certify that you or your business have not committed a criminal offence such as corruption, fraud, or participation in criminal enterprises.
On completion of the PQQ, you will receive either a pass or fail mark, which will dictate whether your company is eligible to submit an Invitation To Tender. For example, if you have answered ‘yes’ to any criminal convictions, your tender document will often be marked as a ‘mandatory exclusion’ – although some buyers may be more lenient for minor offences, such as non-payment of small amounts of tax.
At the ITT stage, you will be asked a series of questions to determine whether your business can deliver the results that your buyer requires. This will be based largely on your pricing structure, the quality of your service, and any added value that your company can offer.
You should be given the evaluation criteria as part of your tender document – if it is not included, always ask the buyer to provide it, as understanding the marking criteria will greatly improve your chances of winning the contract.
The Invitation To Tender (ITT)
Tenders are evaluated based on a price/quality split. Your buyer will decide how to weigh these considerations by using the principles of Most Economically Advantageous Tender (MEAT).
MEAT is how your buyer prioritises price and quality according to their needs. For example, a buyer that emphasises cost-effectiveness over quality may weight their scoring at 70% price and 30% quality. This would mean that up to 70% of a bid’s marks can be awarded for pricing strategy, but only 30% can be awarded for quality. As such, an applicant for this type of tender should focus on emphasising their cost-effectiveness.
In this instance, the applicant who offers the lowest price will typically receive full marks for this section, whereas the bidder with the highest price will receive the least marks. This may mean that an applicant can successfully win a contract if they offer a lower price than their competitors, even if they don’t deliver the same quality of service.
On the other hand, if a company prioritises quality over cost-effectiveness, they may weight their scoring at 70% quality and 30% cost-effectiveness. This would mean that up to 70% of a bid’s marks could be awarded for quality, so an applicant may win the contract even if their prices are set higher than their competitors, as long as the quality of their service stands out.
To be able to give your buyers an insight into how your costs are calculated (known as your pricing strategy), you should break your costs down into several areas.
- Your company’s monthly/annual costs
- The itemised costs per unit – including your material costs, equipment costs, and service costs including wages
- The anticipated annual inflationary increases
- Your total costs before and after VAT
The Quality criteria are broken down into several areas, which can include aspects such as:
Technical Ability – i.e. your technical capacity to deliver high-quality results; this can be demonstrated through qualifications, past projects, and available resources etc.
Service Delivery – i.e. your ability to provide a high-quality customer experience through qualities such as responsiveness, communication, and added value
Support Quality – This includes factors such as customer care and ongoing technical assistance
Environmental Compliance – Does the bid proposal meet environmental guidelines and any relevant green targets? These requirements for greater sustainability may be set not just by government regulations or industry standards, but also by the particular goals of the organisation putting the opportunity up for tender
Social Value – This measures the value that will be delivered to the nearby community if your company’s bid is successful, and it can include things such as donations to charities or investment in infrastructure that benefits the local population
Each of these areas will be given a percentage of the marks according to your buyer’s priorities, and how your buyer weighs each area should be outlined in the evaluation criteria provided for the bidding opportunity.
Your quality section will be given an overall score from 1-5, with 5 rated as ‘Excellent’, and 1 as ‘Not Eligible For Consideration’.
How To Write A Winning ITT
Prioritise the most highly weighted section – If you can achieve top marks for the most highly weighted section, you are more likely to win the contract. However, don’t disregard the other parts of the bid altogether, because if your responses to the most highly weighted section are lacking, having stronger answers to other sections can improve your chances of winning the bid.
Go above and beyond – Don’t just meet your buyer’s expectations, exceed them! Going above and beyond the bid requirements will improve your chances of standing out from your competitors and securing the work for yourself.
Provide examples of added value – You should always include examples of added value so that your buyers know they will be getting their money’s worth. If your potential buyer is impressed by how much added value your company can deliver, you will stand a greater chance of winning the contract.
Use evidence – You should be able to evidence that you have successfully completed similar contracts and met the expectations of previous buyers. This evidence should include any relevant dates, details of the work your company completed, and any feedback you received from past clients.
Use appropriate design and layout for your proposal – Your bid document should be easy to read and designed appropriately for the sector of the opportunity you are applying for.
Most industries will require your tender to be clean, simple, and not overloaded with graphics or design elements. But in the creative sector, you will be required to showcase your graphic design abilities within your tender document by using imagery and design elements.
Use the correct industry terms, spelling, and grammar – You should use industry terms in moderation to show understanding of the sector, but don’t overdo the jargon! And if you use acronyms, you should also provide the expanded terminology to enable your reader to easily understand your document.
In addition, using the correct spelling and grammar is essential for creating a professional image – if you are perceived as amateur or lacking expertise, you can lose marks for quality, and your submission may even be disregarded entirely.
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