bob moodie & vicky byers njm european, economic & management consultants ltd selling to the...
TRANSCRIPT
Bob Moodie & Vicky Byers NJM European, Economic & Management Consultants Ltd
Selling to the Public Sector – helping Leicestershire SMEs unlock their potential
Public Sector Contracts: Writing Winning Bids
Writing Winning Bids
1. Introduction
2. First Steps - Opportunity Identification
3. Developing a Strategic Approach to bidding
4. Pre-Qualification Questionnaires
5. Invitations To Tender
6. Do’s & Don’ts & Avoiding a Poor Score
7. Tender Presentations
A New Procurement EnvironmentPolicy/Legal Economic/Financial
EU Competition Policy (Procurement)
Coalition Govt. / Local Govt.(Transparency – LAs must publish details of all Invoices of £500+)
Coalition Govt’s aspiration to award 25% of central Govt. contracts to SMEs
Leicestershire County Council’s Sustainable Commissioning & Procurement Strategy (2009-13)
Price & Value for Money (VFM) & M.E.A.T.
Comprehensive Spending Review
Rationalisation & Framework Agreements
Contract Bundling (Economy of Supply) Ability to deliver economies and efficiency savings
Social Technological
Corporate Social Responsibility
Sustainability, Equality & Diversity
Innovation & non contractual outcomes
E-Portals
E-tendering & E-auctions
Real time reporting
Who?Opportunity Identification
Opportunities: Public Sector UK Public procurement is estimated at over £175 billion per annum
(13% of UK GDP).
Leicestershire County Council spends over £300 million each year on goods, works and services. From 2011-12 to 2014-15, the Council will need to make savings of around £82m, including £22m from commissioning and procurement.
Leicester City Council’s estimated procurement budget for the Authority was £260 million p.a. (2007-2008). From 2011-12 to 2014-15, the Council will need to make savings of around £100m from its total annual budget of circa £1bn.
NHS Leicestershire & Rutland Procurement Partnership influences spend of approximately £250 million on goods and services each year.
Opportunities: Public Sector 9 Local Authorities:
Leicestershire County Council Leicester City Council North West Leicestershire District Council Charnwood Borough Council Melton Borough Council Blaby District Council Harborough District Council Oadby & Wigston Borough Council Hinckley & Bosworth District Council
3 Universities: Leicester, Loughborough, De Montfort 7 FE colleges: Stephenson, Loughborough, Brooksby Melton, North
Warwickshire & Hinckley, South Leicestershire, Leicester, Loughborough University School of Art & Design
SchoolsOther: NHS (subject to major review) Housing Associations / RSLs The Emergency Services
Where?Opportunity Identification
Finding Opportunities Where should you look / who should you know?
PUBLISHED UNPUBLISHED SOURCES
Tender websites & Supplier portals
Networking / relationship building
Organisational / Sector websites Procurement Teams / Category Managers
Tenders Electronic Daily (TED) Operational departments and units
Local / National press / Press releases
Market analysis / competitor intelligence
Trade Press Partners / sub contractors
Meet the buyer events / briefings
Second / Third Tier Contractors / Supply chains
Contract Notices: Key WebsitesName: Source: Used by:
Source Leicestershire www.sourceleicestershire.co.uk
LAs, NHS in Leicestershire
Eastern Shires Purchasing Organisation
www.espo.org LAs, NHS in Leicestershire, OJEU tenders
Leicestershire County & Rutland NHS
http://www.lcr.nhs.uk NHS
Voluntary Action Leicestershire
www.valonline.org.uk Contract opportunities for voluntary sector
In-Tend www.in-tend.co.uk Universities, Colleges, Schools, LAs (some in Leicestershire and nationally)
Blue Light www.blpd.gov.uk Police, Fire & Rescue Services (including Leicestershire Constabulary & across UK)
Supply to Government www.supply2.gov.ukwww.supply2health.nhs.uk
Lower value government tenders (*website will be replaced by ‘Contracts Finder’ March 2011)
OJEU www.ted.europa.eu Any public sector contract above EU Threshold
How?Opportunity Identification
Procurement ProcedureProcedure Characteristics When the procedure is adopted
Open All qualified applicants must be given the opportunity to bid
For lower risk procurement where supplier capability is less important or where the focus is on price
Restricted Two stage process with facility to shortlist (PQQ + Tender)
Where capability of supplier is key determining factor in the delivery of the contract, market response likely to be huge to allow short-listing
Negotiated Two stage process with facility to negotiate at second stage
Specification is not clear or some creative, artistic or expert input is required.
Competitive Dialogue
Two stage process with facility to enter into a dialogue with potential suppliers to consider potential solutions and refine specification before invitation to tender
Complex procurement where suppliers expertise has significant impact on the development of the specification
Framework Agreement
Stage One: Suppliers selected through open/restricted procedure to a panel of suppliers for given periodStage Two: Call-Off or Mini competition will be held when services/goods required
Capability and Capacity is important and is generally a recurring/constant requirement (max 4 years; including extension options)
Public Sector Organisation
Threshold (Goods & Supplies)
Procurement Process & Source
Leicestershire County Council
<£1k£1k – £20k
>£20k – £100k
>£100k – EU threshold (£156,442)
1 Oral / Written Quote3 Written Quotes or www.sourceleicestershire.co.ukRequest for Quotation www.sourceleicestershire.co.uk
Formal Tender Process www.sourceleicestershire.co.ukOr www.espo.org
Charnwood Borough Council
£0 – £5k Quotes (optional)£5k – £25k 3 Written Quotes to Head of Services, with consultation of
approved list£25k – £75k 3 Written Quotes to Contract Compliance, with consultation of
approved list and also advertised in the contract register at:http://exhibeo.charnwood.gov.uk/Contracts/ContractTender.aspx and also at: www.sourceleicestershire.co.uk
£75k – EU threshold (£156,442)
Full Tender procedure normally advertised at www.sourceleicestershire.co.uk)
(Construction-related works only)
Invite tenders from pre-qualified suppliers registered with www.constructionline.co.uk
University of Leicester £5k - £25k
>£25k – EU threshold(£156,442)
3 Oral / Written QuotesFormal Tender via departments or www.in-tend.co.uk
Local Procedures
Be Systematic & Get Organised
Be Systematic & Get Organised What is your target market? In your target market who are the key buyers - Personnel
at Department level and Procurement Officers (important for low value contracts that are not formally advertised)?
Engage procurement personnel - make sure they know you exist, seed ideas
Find out about approved (accredited) supplier lists however note that authorities are moving towards framework agreements
Register your details on tender e-portals and set up for Alerts service, newsletters etc
Set up internal processes and individual(s) to monitor tender portals, alerts, sources and review feedback
Network (buyers/commissioners, meet the buyer events)
Competitor analysis (New Transparency:£500+invoices) Search for potential business partners / collaborators /
subcontractors Develop / improve your key policies so that you comply
with public sector tender competition requirements Accreditation (e.g. CHAS, ISO, IiP etc)
Be Systematic & Get Organised
A new and critical source of intelligence
As part of Coalition Government commitment to transparency in public expenditure (as of February 2011) every Local Authority must publish details of invoices of £500+
Information can be used to identify competitors and/or potential collaborators/subcontract opportunities
To bid or not to bid?Developing a Strategic Approach
Strategic Decision Making
Is the tender a good fit in relation to your company’s activities?
Can you meet the eligibility criteria (technical qualifications, policy compliance e.g. Quality Assurance, Insurance) ?
Do you have a good track record in relation to the opportunity?
Do you have the trading history (e.g. 2 years Accounts)? Do you have the capability and capacity to deliver the
contract if successful? Can you make sense of the budget and can you deliver the
contract on time?
Strategic Decision Making
What are the risks? Who are your competitors? What percentage of your turnover does the contract
represent? Do you need a partner(s) or will you use
subcontractors? What is the percentage chance of success? Do you have the time and resources to devote to
preparing a good bid?
Solo or Collaborative Bidding? Form a consortium if:
You don’t have the capability or capacity You can’t meet the 20% rule
Options: Consortium
Joint Bidding Lead Contractor & Subcontractor
Legal basics – will you be jointly and severally liable? Memorandum of understanding (MoU) / Partnership agreement /
(Non Disclosure agreement (NDA); Agreement not to compete in other tender)
Service level agreement (SLA)/contract NB. consortium should be properly led, constructed and managed
Strategic Decision Making
ConsortiaBenefits: Risks:
Increase capacity and scope to bid e.g. Overcome PQQ impediments
Partner selection and getting Agreement / legal document
Shared trade history (combined capability and capacity)
Trust relationship (how well do you know your partner – can you be confident they can and will deliver)
Business Development: Access new clients and markets
Complex decision-making, loss of autonomy, compromises and concessions
Spread risk Sharing sensitive information
Mutual learning and innovative approaches
Logistics (Co-ordinating bid)
Delivered additional added value (the whole is greater than the sum of the parts)
Logistics (Contract delivery)
Improve chance of success
PQQs & ITTs
Procurement Process Overview
ProcureContract Notice
EOI
Tender
EvaluateManageReview
Commission
PQQ
Award
Pre-Qualification Questionnaires
The First Hurdle Evaluation of your organisation
The aim of the PQQ is to check that your company is (for the contract term) Technically competent Financially sound Legally compliant
Gives the buyer a means of short-listing interested organisations on the basis of fair and objective criteria
PQQ: Example Scoring FrameworkSection Score Weighting
1 Organisation Details N/A
2 Financial Information N/A or Risk Based Assessment Pass/Fail
3 Insurance Pass/Fail
4 Business Activities 15%
5 Business Practices 30% (Total)
Health & Safety 5-10%
Quality Assurance 5-10%
Environmental Management 5-10%
Equality 5-10%
6 Requirement - specific 40%
7 Experience & References 15%
8 Professional & Business Standing Pass/Fail
Example ‘Scoring’ CriteriaScore Response Type Reason indicated for Score
0 Non-compliant response No relevant information / solution provided in response to contract requirements.
1 Unacceptable response Partially compliant response but with serious deficiencies in solution offered, indicating serious difficulties / inability to deliver contract requirements.
2 Unsatisfactory response Partially compliant response with shortfalls in solution offered, indicating not all contract requirements could be met and thus difficulty in delivery of the contract.
3 Acceptable response Compliant response, indicating basic contract requirements are met but not exceeded. Contract could be delivered.
4 Good response Compliant response, clearly indicating entire delivery can be met and solution offers some limited benefits beyond stated requirements.
5 Excellent response Compliant response, bidder illustrated comprehensive understanding of contract reqs. Proposed solution provides significant additional benefits beyond stated reqs.
PQQ InformationGeneral Business Information Business Details Status (Sole contractor / consortium) Ownership Business Probity Professional Conduct
Documentation required may include: Company History HR Information Administrative Information (Company Registration/VAT Number) Quality Standards Accreditation / Certificates
PQQ InformationFinancial & Insurance Information: Turnover
Accounts
Insurance
Documentation Required may include: Audited accounts, Management accounts, Parent company accounts Bankers statements & accountants’ references Financial projections, including cashflow forecasts Details of previous contracts and values Capital availability Certification of Incorporation, Certificate of Name Change Insurance Certificates
NB financial vetting is based on sound business judgement and not just the application of financial formulae
PQQ InformationGeneral Business Activities Overview of Existing Business Activities Overview of Main Areas of Expertise & Accreditation What percentage of your business is concerned with providing services
similar to the contract requirement HR Information (Number of Staff, Staff Profiles)
Contract Specification Explain and demonstrate your Capability and Capacity to fulfil the
contract requirement Case Studies (relevant to contract specification and demonstrating your
ability to fulfil the size, scope and complexity of this contract) Subcontractors Relevant References (norm = 3 recent referees) & contact details
PQQ InformationEssential Policies: Quality ManagementEquality & DiversityHealth & SafetyEnvironment Management & Sustainability
Why are they necessary? They are a legal requirement They are a purchaser requirement They help articulate the company’s values and principles for both
staff and clients They bring business benefits and are relevant to contract delivery
Health & Safety, Equality & Diversity & Environment Policies
Can you articulate the business benefits of these policies
as they may relate to the conduct of the contract?
Do you have a Health & Safety Policy? Weak Answer: “Yes, see Appendix 1”
Good Answer: “The Health & Safety of our staff and customers is a vital part of
the company’s quality process. We operate a comprehensive Health & Safety Policy (see Appendix 1) covering all aspects of our products (services) and operations and it is reviewed biannually.”
For an SME employing less than 5 people: “Although we are not required legally to have a Health & Safety Policy, we take this matter very seriously and have adopted a Health & Safety Policy in the interests of our staff and clients (see Appendix 1)”
♪♫♪ Accentuate the Positive ♪♫♪
What Quality Assurance arrangements does your company operate? If no accreditation is held please explain why not and what alternative steps you take to ensure quality at work?
Weak Answer: “We operate our own quality system. We have determined that
formal accreditation is inappropriate to our company’s needs. Complaints are the responsibility of the Managing Director.”
Good Answer: “We regard quality as a vitally important part of our business activity
and we operate a comprehensive and strict internal quality assurance process covering all aspects of our business activity (details can be found in Appendix 2). We are committed to a process of continuous improvement and we are in the process of applying for ISO 9001 (we expect to be assessed in May of this year)”
♪♫♪ Accentuate the Positive ♪♫♪
Business Continuity
What is your Approach to Risk Management in terms of Business Continuity?
Do you have a formal Business Continuity Management Programme? If YES, enclose a copy of your plan/programme document
Within the last 3 years have there been any occasions when you business operation has been disrupted? If YES what were the circumstances and what was the effect upon your
customers?
Do you have a strategy for ensuring continuity of supply from your critical suppliers?
Avoiding a Poor ScoreCommon reasons for a poor score:
1. Failure to follow the instructions
2. Writing by committee, no narrative flow and lack of control/ownership
3. Incomplete or missing answers/sections
4. Supporting documentation incomplete
5. Repeating answers or referring to ‘see above’ (questions are rarely repeated)
6. Over emphasising what you sell, rather than what they are looking to buy
7. Recycling old tenders ‘Cutting & pasting’!
8. Providing response on general capability instead as opposed to specific contract requirements
Invitation To Tender (ITT)
The Second Hurdle Evaluation of your detailed proposal
What are you going to do How are you going to do it Who is going to do it How much will it cost What is your track record / prior experience Compliance References
ITT InformationInvitation to Tender (ITT) pack will include:
Instructions to Tenderers Introduction from buyer who will set out the vision The Specification The Evaluation Criteria & Relative Weighting Form of Tender Draft Contract Terms and Conditions Declarations / Bona Fide Pricing Schedule
Preparing the Tender
Managing the preparation of your bid Get your team together, appoint a bid manager and conduct
detailed review and interpretation of tender requirements. Determine whether you require clarification of any aspect of the
tender and ask the question(s) allowing enough time for a response.
Check regularly to see if any questions/answers have been submitted by competitors. Be aware that any question you ask will be notified to other suppliers)
Prepare work plan & allocation of roles/tasks/milestones with reference to tender & submission deadline. o NB: Build in time to review, refine and style bid
Preparing the Tender
Tender Design: What is the Buyer looking for? Design a clearly structured tender response aligned against each
tender requirement and criteria (e.g. core, gateway and specific). Ensure compliance!
Demonstrate a clear understanding of the brief (i.e. the challenges are understood and addressed)
Methodology: clearly show who (CVs) does what, why, when, how and benefits from buyer’s perspective – illustrate with diagram (Gantt)
Identify and demonstrate clearly your capability and the innovation of your offer (USP) - can your offer exceed the contract requirements and provide additional benefits, outcomes?
Contract management and communication (i.e. how you interface with the client to monitor project)
Standing Out from the Crowd Have you articulated ‘Why choose us?’ Have you fully defined the key features, quality and
benefits of your approach? Have you used and made the most of recent and relevant
case studies to illustrate your track record? Have you gone the extra mile in manifesting your
understanding of the brief and the design of your solution? Conduct a mock assessment against the evaluation
criteria and relative weighting Presentation
Preparing the Tender
Case Studies: Example Structure
Client Name & Contract Title Work of same/similar nature, scope and scale What, When and How you did it Client Benefit (Outputs & Outcomes) Innovation & Added Value Contract Value/Price Reference confirming work was performed to client
satisfaction and to schedule
NB Be concise and relevant
Preparing the Tender:Costing Your Proposal
Follow Instructions in Tender re presentation of costs/fees/prices For services: Charging Rate(s) (Daily/Hourly) & Time & Personnel
Fixed Cost / Variable Cost Expenses & Disbursements Contingency VAT Innovative Cost Proposals
Discounted Cost e.g. 5% early payment, economies of scale and efficiency savings linked to contract term and/or number of contracts (Lots) awarded
Buyer comfort: Offer 10% Contract Price Withheld until completion
Risk: What is your Approach
Risk identified for:
Mitigation (i.e. what will you do)
Impact (High, Medium, Low)
Classification of risk:Reputation (R), Operation (O), Finance (F)
Client
Delivery
Supplier
Exercise
As a local company, how might you emphasise that you have a number of advantages?
Exercise: Answers Wrong Answer: The Council should give contracts to local companies as a matter
of course, because it retains profit in the area and improves local employment levels.
Right answers: Close proximity to client : Allows customers to change their
requirements at short notice Local knowledge: Specialised knowledge of local issues or local
communities Fast response time, leading to better and more flexible service Improved environmental impact of shorter travel distance;
potential economies of expenses Similar demographic profile of service deliverers to service users
Preparing the Tender:Bid WritingLanguage & Style:
Write in plain English: short sentences and paragraphs; Avoid jargon and unexplained abbreviations Use ‘active’ verbs, refer to ‘we’ and ‘you’ In your response try to reflect key wording as found in
the tender specification Punctuation and spelling really matter Lay-out: Use clear headings aligned to tender
specification; standardise fonts, illustrate where possible
Aim for clarity, brevity, readability and persuasion
Do not attempt to find an “inside track” (canvassing) Respond by the correct date + time (electronic,
electronic + post, post?) avoid last minute submissions Ensure the submission is complete AND signed
including copies of requested documentation, e.g. insurance certificates, policies, audited accounts etc
Use tender envelope/label if provided and check if there is a tender reference
Look carefully at the evaluation criteria, scores and “weighting”. This should influence time and effort in preparation of answers
Preparing the Tender:Do’s & Don’ts
Buyer Preferences
LIKE Don’t like
Concise and precise language Wordy tenders, Inconsistencies and errors, poor use of grammar
Clear structure (esp. Methodology) Poor methodology (failure to define who does what, where, when, why and how)
Challenges have been understood and properly addressed
Deviation from defined requirements, lack of understanding of client requirements and failure to answer questions
Relevant background information Lack of detail/explanation or ‘data dump’
Properly defined & appropriate resources Unclear who will be involved in delivery
Systems & procedures Exaggerated and unsubstantiated claims
Innovation – or the opposite (tradition) Poor evidence of reliability
Risk assessment (mitigations) No risk assessment
Case studies & references Irrelevant case studies
Tender Presentations
Converting Opportunities
Tender Presentation
Review and familiarise yourself witt the ITT and the Tender you submitted
Has anything changed since the Tender was submitted which you believe: Impacts the Tender Specification Affects your capability and capacity Allows you to bring additional value
Anticipate and prepare responses to likely ‘difficult’ questions Take copies of your tender with you as the tender panel may wish
to question you on specific elements Select Presenter(s) Rehearse
Tender Presentation
Keep message clear and precise: don’t try to cover too much ground and be interesting
Communicate understanding of the tender brief (don’t stray) Keep presentation simple Illustrate presentation where possible If using power-point features: practice & BEWARE
Animations Purchasing organisations prefer to meet (at the presentation)
members of team who will be performing the work
Conclusion
Concluding Remarks Make note of instructions, word limits and submission format
Be compliant! Try to understand what each question is asking and why they are being
asked. Answer the Question Note the scoring / weighting of criteria. Spend time / effort on your
response accordingly Anything you are not sure of, contact the buyer (but be aware that any
question you ask will be notified to other suppliers) Answer all questions honestly and be keen and positive in your
responses (emphasise your USP). Double check your response / second pair of eyes Ensure you complete and submit all the documents required Make careful note of the deadline and make sure you submit well in
advance of the deadline (Avoid last minute submissions) If unsuccessful (or successful) ask for a debrief
Be...
Tender Sources
www.espo.org
www.sourceleicestershire.co.uk
www.sourcenottinghamshire.co.uk
www.sourcenorthamptonshire.co.uk
www.sourcelincolnshire.co.uk
www.sourcederbyshire.co.uk
www.CompeteFor.com
www.supply2.gov.uk
www.tenders.ac.uk
www.in-tend.co.uk
www.supply2health.nhs.uk
www.procurement.supplychain.nhs.uk
www.sid4health.nhs.uk
www.construction-on-line.co.uk/
www.delta-ets.com
www.ted.europa.eu/
www.exor.co.uk
www.bluelight.gov.uk
www.cbconline.org.uk
www.contraxonline.com
www.publictenders.net/tenders/region/east-midlands
www.dh.gov.uk/ProcurementAndProposals/fs/en
www.publicprocurement.co.uk
www.buyingsolutions.gov.uk
www.skillsfundingagency.bravosolution.co.uk
