Key Guidelines to Winning Government Contracts
For any small and medium-sized enterprise (SME) looking for opportunities to win work from the public sector, you have to understand how to find the business opportunities that exist, and ensure that you are qualified to bid. As our own Donnacha Phelan outlined for LaoisToday.ie in an article on how small business can win public work, SMEs have the opportunity to procure work from public sector organisations that exist within their local or nearby communities. Unfortunately, many SMEs are not aware of the opportunities that exist.
If you want to sell to the public sector, you need to develop a strong bid management strategy. Four key bid management guidelines are outlined below. They are relevant regardless of how you are bidding, whether as an SME, a large company, or in partnership with other companies (e.g., as a consortium).
Understand how public procurement works.
All companies with a view to winning government contracts should recognise that public sector organisations are required by Irish and EU legislation to choose suppliers using a fair, transparent and professional manner. In addition, public buyers must select the supplier(s) that offer the best value, on the basis of the lowest price or the most economically advantageous tender (MEAT). In awarding a contract using a MEAT based award criteria, it simply means that the public sector organisation will be evaluating tenders with regard to both the proposed cost and qualitative value to the organisation.
Public buyers must select the supplier(s) that offer the best value, on the basis of the lowest price or the most economically advantageous tender (MEAT)
In Ireland, all public sector contracts estimated above an EU threshold of €25,000 (or €50,000 for construction works) must go through a rigorous competitive tender process with notices advertised on eTenders prior to or at the time of the issue of the Invitation to Tender documents.
Below the EU threshold, public sector organisations can outline their own company specific procedures for handling procurement. Therefore, if you want to work with a specific public body, you should find out how they manage suppliers. In such cases, public sector organisations will typically provide their specification of requirements to at least three suppliers that they know. As a result, for any business representatives wanting to increase their chances of winning government contracts, you will also want to ensure that the buyers in public sector organisations know about you, your company and the goods and/or services you can offer to them.
Develop relationships with target public sector organisations.
If you would like to sell goods and/or services to public sector organisations, the most effective way of winning government contracts is to:
- Identify a number of specific public sector organisations that are more likely to buy your company’s products and/or services;
- Research the organisations to find out their typical spend, spending patterns, and the current suppliers plus the level of service each provides; and
- Identify and meet the key persons involved in the buying process (e.g., by contacting them directly or during any networking or information sessions they typically offer or attend), so that you can ensure that they are aware of you, your business, the products and services your company offers, and the value you can provide to their orgainsation.
You want to ensure that the buyers in public sector organisations know about you, your company and the goods and/or services you can offer to them
When developing your bid management strategy, bear in mind that public sector buyers are typically wary of meeting suppliers. However, that should not prevent you from finding opportunities to get to know such buyers so that they know that you are an alternate supplier who has the resources and capabilities to meet their requirements, while providing value for money. Perseverance is key to winning government contracts.
Use eTenders to find existing opportunities.
Any Irish company looking to increase their probability of winning government contracts must sign-up to the eTenders procurement website.
Via eTenders you’ll find:
- Prior Information Notices (PINs) with information about contracts that public sector organisations plan to award within a 12 month period or so plus the estimated value of the contract;
- Invitations to Tender targeting suppliers interested in submitting bids; and
- Notices of the companies who have been successful in winning government contracts.
Suppliers should also note the existence of SupplyGov.ie, which is also used by local authorities and a few other state agencies (e.g., the Office of Public Works, Irish Water and the Health Service Executive) in conjunction with eTenders as is pertinent.
Learn how to respond effectively to a Request for Tender
Public sector contracts are awarded to those suppliers whose bids are evaluated as the ones that best meets the advertised award criteria. As such, suppliers need to pay close attention to the award criteria used in tenders from public sector organisations when preparing their proposals.
Pay close attention to the award criteria
For public procurement contracts above the EU Threshold, there are three forms of tender procedures (i.e., Open, Restricted, Negotiated and Competitive Dialogue). With the Open procedure, which is not typically used if the contracting authority anticipates responses from a large number of companies, anyone can request the tender documents and submit a bid in response. As a supplier submitting a bid issued using the Open procedure, you’ll only need to focus on satisfying the award criteria as best as possible while meeting the procurement rules outlined in the issued Request for Tender document.
With the other public procurement competition procedures, anyone can submit an expression of interest along with a response to satisfy all the qualification criteria outlined by the contracting organisation in their contract notice.
In meeting the qualification criteria set by public sector organisations, suppliers typically are asked to confirm that they:
- Meet the financial and economic standing requirements deemed relevant for the contract (e.g., by having a set minimum turnover, sufficient business insurance cover);
- Have the technical and professional qualifications, expertise and experience deemed relevant for the contract (e.g., by providing relevant references); and
- Have the technical capacity to support the contract (e.g., by providing an organisation structure).
Only those companies meeting the qualification criteria are issued with the relevant Request for Tender document and invited to proceed by submitting their bids. As such, as a supplier you’ll first have to see if you can meet the qualification criteria.
Partner with other businesses via a consortium...to meet the qualification criteria
At Sluamor, we strongly recommend that suppliers partner with other businesses via a consortium, as is relevant, to ensure that they can meet the qualification criteria deemed a requisite for existing public procurement opportunities. Such an approach can be extremely advantageous in winning government contracts, especially when the potential contract value is significant (e.g., as in those cases where framework agreements are put in place by a public sector body to give themselves a more economic and efficient means of procuring goods and/or services for the award of multiple short-term contracts).
If you’ve been submitting a large number of bids without any success, you should meet with the relevant contracting authorities to get a better appreciation of where you’re going wrong. Typically, a failure to win government contracts falls in the following categories:
- In your bids, your sales team does not satisfactorily outline the various ways your company can provide value for money to the public sector organisations;
- You do not meet the tender requirements;
- You are proposing to provide goods and/or services that you haven’t the expertise and experience in delivering; and
- You are bidding too high.
Not sure where to start? Contact Keystone Procurement, our parent company. They can work with you to identify and fix your bidding deficiencies, or to improve your staff’s bid writing skills and confidence. They have helped numerous small and large companies in winning more government contracts across varied industry sectors.
Remember to contemplate the use of consortiums if you’re interested in winning government contracts.
If you need help in looking for third parties to setup or join a consortium, send us a message via our Contact page to discuss, or you can forge ahead by using our online platform to pitch your idea or search the list of business opportunities published on our website.
Also let us know if you need help in preparing a pitch for a public or private sector contract.
We do not accept any liability for the consequences of any actions taken based on the information contained on this article. In addition, we strongly recommend that you do not rely on any information contained herein without taking procurement, financial, management, investment or other advice from an appropriately qualified professional adviser.
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