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What is tendering?

June 15, 2021

Blog

What is tendering?

June 15, 2021

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Onderwerp: Gids

Niveau: Beginner

3 minuten leestijd

Came across the term ‘tendering’ and recoiled out of fright? We assure you it’s simpler than the internet makes it seem — and everyone (including yourself) can benefit from including it in your business. In this article, you’ll learn the basics of tendering, and what you’ll need to know before you dip your toes in the art of tendering. After reading this article, you’ll understand the gist of tendering, and how it can be of use to your business.

So, what is tendering? Tendering is the process by which governments or businesses request a good or service (through a 'Call for Tender' document) and a potential supplier responds to that request by writing a ‘tender proposal’. The tender proposal makes an offer regarding the supply of goods or services.

The ‘Call for Tender’ document (aka invitation to tender) may outline information about the: company/government issuing the request, project (e.g., quality assurance requirements, legal procedure, specific timeline, breakdown of products and services required), evaluation process, response format, and contact details. Tenderers then respond to this request by addressing how they’re going to provide the goods or services.

The suppliers’ tender will include details such as pricing, their schedules, and eligibility, their differentiating factors in contrast to competitors, previous experience, and qualifications. In this document, suppliers have to put their best foot forward and describe why they can offer the best value for the price.

Tendering Procedures

Now, this doesn’t always mean that each and every tenderer who sees themselves suited for the opportunity can write a proposal. As there are “three main types” of tendering models that dictate who can apply:

  1. Open tender: This is the main tendering process employed today. Open tendering invites everyone to submit a tender proposal, offering an equal opportunity to all.

  2. Selective tender: This tender is more restrictive, whereby the organization requesting a product or service pre-selects a number of suppliers and invites them to bid on the contract. This type of procedure is best suited for complex contracts that only match with a few suitable firms. Selective tendering results in a quicker outcome than open tendering and can be seen as less wasteful.

  3. Negotiated tender: Negotiated tender involves reaching out to a single supplier that is highly suited to a specialist contractor or reaching out to a supplier to extend an existing contract. The downside is that the negotiation when there’s no competition involved may be complex, but still less time-consuming than open tendering.

Still unclear? Read all about their differences here.

Calculating a tender price, unfortunately, isn’t always rainbows and sunshine. Depending on the availability of information, either a ‘single-stage' or ‘two-stage' tendering process is required. Single-stage tendering occurs when there’s enough information to come up with a price on the spot. A two-stage tendering, on the other hand, means that information is insufficient, so two separate agreements occur. The first one settles technical specifications, and the second one settles the price.

Private vs. Public Tendering

Before you sprint to see what tender opportunities are available (as I’m sure you were about to do), we’d like to note the difference between private and public tendering. The type of tender directly affects the tendering process and its components — and you need to be aware of these differences. Public tendering occurs within not-for-profit organizations (AKA the public sector), while private tendering occurs within corporations managed by individuals. Between the two there are differences in terms of the accessibility of information, transparency, budgets, and motivations. You can read about these here.

After this dump of daunting information, you may be thinking: Why would I go about through this process when I could easily continue going about my day-to-day business processes? Well, there’s a lot more in store for you than you may think

The advantages of tendering include the fact that it can literally be your lifeline. Slightly dramatic? Maybe. But despite the current state of affairs, buyers are still looking for suppliers to support their businesses, and in the public sector, it's guaranteed pay upon winning a contract. This can secure the sustainability of your business if you win long-term contracts which may ensure several years' worth of income. Another benefit is that by simply starting to tender with small contracts, you can gain the experience required to win larger, more valuable contracts; so we suggest you work your way up!

This article more or less gives you an insight into what tendering actually means, and can help you visualize what tendering can mean for you and your organization. If you’d like to venture into the world of tendering, you can check out the latest tenders on websites such as TenderNed, TED, or Altura. For a more personalized search of tenders, tender portals can be used to match you with suitable tenders. They also provide you with all relevant documents and information related to a specific tender, so you don’t have to go scouring the internet to try to piece the tender puzzle together.

Altura’s tendering platform helps tenderers sift through public and private European tenders. These include past, current, and recurring tenders that can be easily filtered to fit tenderers’ needs. Pertaining tender documents can also be previewed, downloaded, and searched all through one page! Interested in knowing more about Altura?

Came across the term ‘tendering’ and recoiled out of fright? We assure you it’s simpler than the internet makes it seem — and everyone (including yourself) can benefit from including it in your business. In this article, you’ll learn the basics of tendering, and what you’ll need to know before you dip your toes in the art of tendering. After reading this article, you’ll understand the gist of tendering, and how it can be of use to your business.

So, what is tendering? Tendering is the process by which governments or businesses request a good or service (through a 'Call for Tender' document) and a potential supplier responds to that request by writing a ‘tender proposal’. The tender proposal makes an offer regarding the supply of goods or services.

The ‘Call for Tender’ document (aka invitation to tender) may outline information about the: company/government issuing the request, project (e.g., quality assurance requirements, legal procedure, specific timeline, breakdown of products and services required), evaluation process, response format, and contact details. Tenderers then respond to this request by addressing how they’re going to provide the goods or services.

The suppliers’ tender will include details such as pricing, their schedules, and eligibility, their differentiating factors in contrast to competitors, previous experience, and qualifications. In this document, suppliers have to put their best foot forward and describe why they can offer the best value for the price.

Tendering Procedures

Now, this doesn’t always mean that each and every tenderer who sees themselves suited for the opportunity can write a proposal. As there are “three main types” of tendering models that dictate who can apply:

  1. Open tender: This is the main tendering process employed today. Open tendering invites everyone to submit a tender proposal, offering an equal opportunity to all.

  2. Selective tender: This tender is more restrictive, whereby the organization requesting a product or service pre-selects a number of suppliers and invites them to bid on the contract. This type of procedure is best suited for complex contracts that only match with a few suitable firms. Selective tendering results in a quicker outcome than open tendering and can be seen as less wasteful.

  3. Negotiated tender: Negotiated tender involves reaching out to a single supplier that is highly suited to a specialist contractor or reaching out to a supplier to extend an existing contract. The downside is that the negotiation when there’s no competition involved may be complex, but still less time-consuming than open tendering.

Still unclear? Read all about their differences here.

Calculating a tender price, unfortunately, isn’t always rainbows and sunshine. Depending on the availability of information, either a ‘single-stage' or ‘two-stage' tendering process is required. Single-stage tendering occurs when there’s enough information to come up with a price on the spot. A two-stage tendering, on the other hand, means that information is insufficient, so two separate agreements occur. The first one settles technical specifications, and the second one settles the price.

Private vs. Public Tendering

Before you sprint to see what tender opportunities are available (as I’m sure you were about to do), we’d like to note the difference between private and public tendering. The type of tender directly affects the tendering process and its components — and you need to be aware of these differences. Public tendering occurs within not-for-profit organizations (AKA the public sector), while private tendering occurs within corporations managed by individuals. Between the two there are differences in terms of the accessibility of information, transparency, budgets, and motivations. You can read about these here.

After this dump of daunting information, you may be thinking: Why would I go about through this process when I could easily continue going about my day-to-day business processes? Well, there’s a lot more in store for you than you may think

The advantages of tendering include the fact that it can literally be your lifeline. Slightly dramatic? Maybe. But despite the current state of affairs, buyers are still looking for suppliers to support their businesses, and in the public sector, it's guaranteed pay upon winning a contract. This can secure the sustainability of your business if you win long-term contracts which may ensure several years' worth of income. Another benefit is that by simply starting to tender with small contracts, you can gain the experience required to win larger, more valuable contracts; so we suggest you work your way up!

This article more or less gives you an insight into what tendering actually means, and can help you visualize what tendering can mean for you and your organization. If you’d like to venture into the world of tendering, you can check out the latest tenders on websites such as TenderNed, TED, or Altura. For a more personalized search of tenders, tender portals can be used to match you with suitable tenders. They also provide you with all relevant documents and information related to a specific tender, so you don’t have to go scouring the internet to try to piece the tender puzzle together.

Altura’s tendering platform helps tenderers sift through public and private European tenders. These include past, current, and recurring tenders that can be easily filtered to fit tenderers’ needs. Pertaining tender documents can also be previewed, downloaded, and searched all through one page! Interested in knowing more about Altura?

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