The True Cost of Bidding

Feb 5, 2021General

With the government target of spending £1 in every three with SME Businesses, more smaller organisations are considering tendering for public sector contracts. But like any business development activity, bidding comes with a cost. In this blog, we’re going to take a look at what those costs are, and how you might minimise the true cost of bidding.

Bidding Takes Time

Whether all you need to do is complete a simple questionnaire to apply to be on a framework or submit a fully detailed proposal in response to an Invitation to Tender, there’s a time cost involved in bidding. You’ll need to ensure that you allow time for:

  • Identifying tender opportunities
  • Downloading and carefully reading tender documents
  • Making a good bid-no bid decision
  • Preparing the bid
  • Submission

If you’re new to bidding, then it can be difficult to estimate how long each of those activities will take and particularly in smaller companies, tender writing is often just one part of someone’s job and needs to be balanced alongside other roles such as sales and business development. But, of course, every hour that is spent working on a tender opportunity costs the company money. To calculate the true cost of bidding, you need to take into account the man-hours spent on any opportunity, and what they have cost the business.

We know that many small business owners take on the work of tendering themselves, giving up evenings and weekends to complete their tenders; but that comes at the expense of valuable family time or much-needed rest and relaxation.

It’s also worth considering what you or your team are not doing while they are working on a bid or tender. If giving staff a bid to work on means they aren’t able to deliver great service to your existing customers, that could cost you dearly.

On the flip side, if your team are putting the bid onto the back burner so they can take care of other things, your responses aren’t going to be as good as they could be. It’s one thing to invest in completing a tender response and win the work, but another to put in the effort and make a mistake, or not put enough effort in, and lose. This can be particularly true if you are bidding against larger organisations who have a bid team in house.

Bidding Takes Knowledge

Downloading tender documents can feel overwhelming. You find yourself looking at a folder full of documents you must read, and some of them are legalese, some are forms to complete, and some are the technical specifications of what is needed. We often hear that small businesses feel over faced when they first look at a tender; it can be a steep learning curve.

But it isn’t just the tender documents that you need to understand, you also need to have a feel for the context surrounding the contract: Who is the current contract holder? How are they performing? What are the organisations wider priorities and ambitions? Knowing your client allows you to create bid responses that are both compliant and responsive, and more likely to win.

You’ll probably also need to call in experts from within your company to help answer some of the questions. You may need to include specifications of the products you use or the service you provide and answer questions about the way your team operates. If you don’t have those answers yourself then you will need to get subject matter experts on board to give you the information you need to write a winning response.

Expert Help

The alternative to the cost of DIYing your bid is to hire in specialist help. That might come in the shape of a freelancer or a consultancy like ourselves. You can find our guide to finding the right bid writer here. While bid professionals don’t have an industry body, we do have a membership organisation the Association of Proposal Management Professionals who share best practice and offer the opportunity for professionals to take exams and prove their competency.

At Bid for Success, we work with each company and each bid in an individual way to help get you the support you need. Our rates vary depending on the size of the organisation we’re working with, allowing us to offer affordable bid support to SME businesses. We will also look at each tender opportunity and come up with a strategy to approach it that works for your budget; that might be us taking the whole thing off your hands, or it could be a simple compliance check before you hit submit.

A professional bid writer will be able to prepare a bid quickly and well as they are already familiar with the process and the legalities. They’ll know what to look for in a tender and make sure that your responses are compliant and that they meet the broader needs of the client.

Minimising Costs

Your first bid or tender is going to be a learning curve, but once you’ve got one under your belt, the following bids will come easier. You can minimise your costs by:

  • Using expert help to support you in your first bid
  • Building a ‘bid library’ and saving this bid there for future reference
  • Adding certifications, insurances, and other supporting documents you might need
  • Keeping a record of work completed and reference contact details
  • Re-using content from your first bid for the next (caveat, you should always check every word before using responses again!)

Understanding the Cost of Bidding

Putting together a credible bid response comes at a cost, whether you do it yourself or hire in specialist help. We believe that the best way to minimise those costs while maximising your chances of winning is to hire specialist help, and we’d love to help you with your next tender. We offer two days free support to a new SME every month through our SME Scholarship programme, or you can book a call with Sarah, our Development Manager, today to talk about how we can best support you in your bid for success.

Adrian Corcoran

Adrian Corcoran is Managing Director and Founder of Bid for Success. Passionate about working with great businesses to win them new work, she and the Bid for Success team are here to help you with your bidding and work winning needs.

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