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Many SMEs wonder how to become a government supplier. They recognise the advantages and prospects of listing government bodies as clients and climbing the contract ladder.
It’s true that listing previous contract experience with government clients will help you to secure larger contracts. However, this is a bit of a chicken and egg situation, isn’t it? How can you win a contract in the first place to gain the experience you need? We all remember struggling to land our first job straight out of education, without that all-important experience. Well, this is similar.
In this blog, we’ll explain how to become a government supplier if you’re a small business. We’ll cover:
We’re not going to get very far without identifying an opportunity, are we! In the UK, there are hundreds of websites that publish new tendering opportunities, including the government’s own website, Contracts Finder. The problem is that these websites are not that easy to navigate and they’re not efficient to use.
Why? The main culprit is CPV codes (common procurement vocabulary). An eight-digit code, used for categorising opportunities into ‘subject matter’…in theory.
CPV codes are often used incorrectly by buyers due to the vast number of codes available. A study by the European Commission sampled 405 contract notices. They found that 23% had the wrong code associated with the scope of work tendered. This results in an inefficient sourcing process for you, the prospective supplier.
That’s why we created our own tendering portals, housed under Hudson Discover. We removed the use of CPV codes or algorithms and replaced them with manual opportunity tracking. Not only that, but the portals are also sector-specific, making them even more tailored to the user. More information about our portals can be found here:
If tendering is new to you, becoming tender ready is an important step. In any tender, you will be required to provide certain documents and evidence. The savvier tenderers will spot that the same, or similar, documents are required by each buyer. Therefore, you can get a step ahead by preparing these documents in advance.
From our experience, the most commonly requested documents are:
For help with getting tender ready, visit our dedicated Tender Ready service page.
Before you jump into writing your tender responses and working out your pricing, we recommend:
As a general rule of thumb, we advise against bidding for contracts with a value greater than half your turnover. This is your economic financial standing. For example, if a contract has a value of £50,000, you should be turning over at least £100,000. This is because you may struggle to prove that your resources meet the requirements. Often, buyers will ask to see your financial accounts during the tendering process.
As we mentioned above, government buyers will often ask to see three case studies. They should be from contracts you have delivered within the last five years, in a similar field to this scope. If you can get testimonials from your previous clients, this will help to further demonstrate your capabilities.
Government buyers are accountable for their spending. They have to demonstrate how they have delivered the best value for money because they’re spending public purse. This means that to become a government supplier, you need to evidence added value. It’s not just pricing that buyers consider to be good value. It’s a combination of quality and price throughout the life of the contract. So, make sure you highlight how and why your approach is cost-effective and helps the government make savings.
Becoming a government supplier is beneficial for both you and the government. The UK government is targeted with spending £1 in every £3 with small businesses. So, how are they helping small businesses secure contracts?
Since leaving the EU, there is more flexibility for lower value government contracts to be reserved for SME bidders. There is also more flexibility for Voluntary, Community and Social Enterprises (VCSEs).
The prompt payment code offers suppliers peace of mind. It states that public sector buyers must include 30-day payment terms in their contracts. They also need to ensure that this is passed down the supply chain. If this is not happening, businesses are encouraged to raise this directly with the Public Procurement Review Service.
If this was the case, interest becomes liable as set out in the Late Payment of Commercial Debts (Interest) Act 1998. This means that businesses can claim interest on any late invoices.
The Small Business Commissioner is a free service that ensures fair payment practices for all small businesses in Britain. The body supports businesses to resolve payment disputes with larger businesses.
When SMEs research how to become a government supplier, they sometimes overlook social value. The Public Services (Social Value) Act 2012 became law on 8th March 2012. It requires public sector organisations to consider the supplier’s potential to deliver services that benefit the local area and people.
In January 2021, new measures came into effect. Any public sector organisation procuring goods/services with a value of over £180,000 is obliged to ask bidders about social value. A 10% weighting has been placed on these questions in tenders and PQQs. Therefore, it’s worth considering how your business aligns with the aims of the social value measures, which are:
If you’re wondering how to become a government supplier, read our top 10 tips:
Allocate someone in your team to keep on top of new tendering opportunities. If you’re using the government’s website, they should allocate at least 15-30minutes per day to check for new tenders. If you’re using our Hudson Discover tendering portals, they’ll just need to keep an eye on their inbox. Either way, they need to take action immediately when they identify an opportunity. The rest of your team needs plenty of time to read the documents and write the responses.
Check our top three tips above and answer those questions before diving in. You should also assess the competition and how the new business would impact your current workload. Make sure that you have experience, and that the bid is realistic for you to win.
The portal will be used to:
Make sure you know your way around and don’t leave it until the last minute to submit your bid. If you miss the deadline, the buyer doesn’t have to grant you an extension or even look at your bid. Even if you missed it because of technical difficulties – the buyer doesn’t have to make allowances. Don’t take the risk!
Break down the bid requirements and assign people in your team to take charge. This could be collating your policies, answering specific questions, or keeping your time management in line. Give each team member a clear role and deadlines for any input they will have.
To make an impression on the buyer, it’s important that you understand them and their core values. This will help you demonstrate how your values align with theirs in your responses. If there is an incumbent supplier, you can try to find out who they are and how they are performing. Then, structure your responses around what the buyer is looking for.
When you start writing your responses, always refer back to the question and make sure you’ve answered it. Use the buyer’s exact wording from the question to directly address their requirements.
Avoid empty or cliché statements such as ‘our people are at the heart of everything we do’. Fluffy statements like this are fine for marketing, but not bidding! Make sure you have evidence to back up every claim you make and demonstrate added value throughout.
The evaluator is most likely not an expert in your field. Using overly complicated jargon will only make your bid difficult to understand, and in turn, to evaluate. Keep the language simple and the sentences short – around 20 words per sentence is enough.
Don’t skip the proofing! Check for grammatical and spelling errors – they raise red flags with buyers for a lack of attention to detail.
Some bids will follow a more rigid approach. The buyer will stipulate the font and point size for your responses and/or provide boxes for you to fill in. Others will follow a free-flowing proposal layout where you are given creative freedom to present the information. If this is the case, we always recommend having your bid professionally designed. It’s a great way to stand out amongst your competitors and make your bid easy to follow.
For help with Bid Design, see our sister company, Vocal.
Unfortunately, you won’t always be successful in every tender. It’s important to not be too disheartened and use this as a learning opportunity. Ask the buyer for feedback if it hasn’t been provided and review it with your team.
If you’re losing multiple bids, it might be time to bring in a professional to assess how you could improve. See our Tender Improvement service for more information.
We’ve reached the end of our blog on how to become a government supplier. We hope our information was helpful. If you need a quick recap, here you go:
Our team of consultants are here to help you.
They have a thorough understanding of the tender process and government contracts, knowing exactly how to respond.
By outsourcing to professionals, you could improve your chances of winning contracts.
We have over 60 years of bid writing experience and an 87% success rate. Whether you’re completely new to tendering or aren’t seeing results – we can help. There are four bid writing packages available:
Once you’ve found a government tender you’d like to go for, send it over to us. One of our Bid Writers will write the tender response for you. We’ll provide a full Tender Writing breakdown and even submit the bid on your behalf.
Tender Mentor can give your tender response a once-over before you submit it. Our Bid Writing Team will analyse your response, notifying you of any errors and opportunities for improvements prior to submission.
During the Tender Ready service, our team will create professional policies, procedures, and case studies in your company branding. If you already have this content, we will review everything carefully to ensure that nothing is missed. Once the programme is complete, you’ll have access to three days’ worth of bid consultancy. This can be used for bid writing, tender reviews, or general advice and guidance.
The Tender Improvement package can help those who have tendered before but aren’t seeing results. Our Bid Writers will assess your previous responses and work with you to develop improved content.
Get in touch to find out how we can help your business grow.
A subscription to one of our sector-specific portals will include:
If you want to streamline the process even further, you can sign up to Discover Elite via your chosen portal. With this service, a dedicated Account Manager will find live bids on your behalf. They’ll speak with you weekly to discuss opportunities that may interest you. This is especially helpful for those with little time to spare due to busy schedules.
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