Before going to tender
Preparation to win tenders usually starts well before the RFx is released. Companies that win numerous tenders generally do a lot of preparation before the RFx is released.
Companies that win numerous tenders generally do a lot of preparation before the RFx is issued.
- Understand the buyers
- Understand your competition
- Define your business
- Knowing the rules of engagement
- Build visibility to gain interest from buyers
- Searching for opportunities
There are a lot of buyers out there. You’re likely to be more successful with buyers when you can really meet their needs – so it’s important to choose the buyers that are right for you.
Many large corporations and most councils and government agencies have a strategy section on their website. This will give insight into their priorities and major plans. The annual report will also be a source of intelligence on their strategy and direction, while news items may highlight areas where the organisation has issues.
If you haven’t already, register yourself on GETS and sites like ICN gateway to see what kinds of opportunities buyers are advertising. By reading general RFx documents from buyers, you can begin to get a good feel for the kinds of suppliers they are looking for.
Seek out opportunities to meet with buyers in your target group. Attend the occasional briefings they host, and check out your local industry association and chamber of commerce in case the buyer is speaking at a seminar soon.
You can also call to introduce yourself to a buyer, but ensure you have done some homework first and have some specific questions you want to ask. If you can, find other suppliers who are selling to the buyer and talk to them about their experiences. You could also talk to the buyer’s customers and see what their needs are.
Knowing what the buyer wants or needs will give you a real edge, as you can then establish what unique offerings you have to meet their requirements.
The best position is to have a good relationship with your customer before an RFx comes out. A buyer who already knows you and your product/service is more likely to support your company than one they’re unfamiliar with.
Understanding who is likely to compete against you to win tenders is an important part of developing winning tenders. Keeping up to date with what your competitors are doing or planning is an essential part of sharpening your competitive advantage and staying one step ahead.
The first task is to identify your key competitors. You can probably easily list your main ones, but research will help you uncover new information and deepen your understanding of the market.
Here are some ways to improve your understanding of your competition:
- Networking is an important part of keeping alert to market developments. Joining industry associations or business groups such as your local Chamber of Commerce or the Employers and Manufacturers Association is a good way of discovering more about competitors.
- The internet offers a rich mine of information. Use online search engines to find information and lead you to competitors’ websites.
- Local industry-specific periodicals are a useful source of information and competitor advertisements.
- The Yellow website www.yellow.co.nz and the ICN gateway have great search facilities.
- Statistics New Zealand can provide business demographic information in New Zealand down to suburb level. There is a charge for more detailed information, and no actual names can be supplied. However, what you uncover can be very useful. For example, if you wanted to establish a paint and panel business, or open a new branch of an existing business, you can find out how many paint and panel shops are in your city or town, and the number of staff they employ. Visit www.stats.govt.nz to see the services offered and for contact details of the office nearest you.
- Visit your local library and ask for help to find information on possible competitors. Most large libraries keep a selection of industry directories from various parts of the world and subscribe to a range of journals. Some city libraries (e.g, Auckland, Wellington and Christchurch) have developed special business services that can help with market research projects of this nature.
Analysing your competitors
Once you have a list of your competitors, you need to deepen your knowledge of their operations.
- Examine competitors’ websites for what they reveal about their goals and intentions.
- Review competitor sales material and ads for strengths and weaknesses, for evidence of what your competitors are doing and may be planning.
- Get on their mailing list for catalogues and newsletters.
- Add a question to your customer surveys asking who else they buy from, and why.
- Your accountant can be a useful source of information on your industry. They may have worked with similar businesses and be aware of industry benchmarks. These might include typical mark-ups or charge-out rates for products and services, or other information you can use to check if you need to up your performance. For instance, if your stock turnover rate is much slower than the industry average, or your average debt-collection time is out of line with the competitors, you can set new goals to improve your competitive efficiency.
- Competitors’ stalls at trade fairs and exhibitions offer a good source of information.
As you research your competition, consider this:
- What are the main benefits offered by each competitor?
- How well do they communicate their competitive advantages?
- How have they positioned their business in the market?
- What other strengths and weaknesses does your research reveal?
- What can you improve on, or do better in your own business?
|My Company||Competitor A||Competitor B||Competitor C||Competitor D|
|Value for money||2||4||3||2||5|
|Delivery in full, on time||3||2||4||3||5|
Before you can confidently offer your products or services and compete in the tender market, you should have a good idea of your competitiveness – your capabilities and limitations, and what makes your business stand out.
A Strengths/Weaknesses/Opportunities/Threats (SWOT) analysis will give you a better understanding of your competitiveness. Importantly for tendering, a SWOT analysis will help you focus on your strengths, weaknesses and opportunities in relation to your competitiveness in the market. This information will guide you to the sort of RFxs to bid for, what you might emphasise in your bids, and where you can improve to have a better chance of winning bids.
A good SWOT analysis tool is provided here: SWOT-Analysis
Large corporations, government agencies and local government often have specific rules around how and what they buy. It is important that you know what their rules of engagement are.
Supplying and working with government section of this website can help you understand how New Zealand Government agencies buy. Procurement departments in private sector corporations can provide you with their policies and processes.
Buyers often research the market using tools such as their own knowledge, previous experience, internet research, asking suppliers through an RFI process, questioning other buyers, having a consultant do market analysis, contacting professional and industry bodies, and searching the Industry Capability Network database.
Make sure information about your company is in the places a buyer is looking for it.
Make it easy for your buyers to find you:
- Keep your website up to date. Do a search on your sector and location – if your company does not come up in the first three listings when you run a search, you may need to consider hiring a search engine optimisation specialist to help you.
- Consider how your website and key publications look to the buyer. Do they convey the right messages?
- Regularly attend industry conferences, ‘meet the buyer’, and supplier briefings so the buyers start to recognise you as a serious contender in the field.
- Become an active member of your local chamber of commerce, industry or professional services organisation. Attend events, keep your profile current, and make sure they receive your news and updates.
- Contact your local economic development agency to find out if they can be of help.
- Send updates and news to industry publications. Advertising in them will also lift your profile.
- Register on sites like ICN Gateway that buyers might be searching.
- Be prepared to travel and invest time in building relationships with your buyers.
- Be persistent and patient – it may take time to build visibility and get on your buyers’ radar, but the results are worth it.
- When you are ready, introducing yourself directly to a buyer can be very powerful. Make sure you have done your homework first and have a good reason for making contact – first impressions count.
Find contract opportunities section of this website includes a number of links that will take you various government tender sites. You can also run a search for “tender opportunities” on the Internet to find private sector tender sites and individual tenders.