Last updated: Apr 18, 2023 @ 11:36 am

You may be asking yourself, what is tendering in business? It’s a common question if you’re new to the world of procurement. This blog will explain what tendering is, how it can benefit your business and the different types of tendering procedures. There are a lot of similarities across multiple industries in the way they do business in the public sector.

So, what is tendering in business?

Essentially, tendering in business is a formal process where a business is invited to bid for contracts. These tenders can be released by either public or private organisations. Potential suppliers will then complete a tender response and buyers will evaluate the responses and select a preferred supplier.

A tender response should be persuasive and convince the buyer that you’re the best company for the job. Buyers will often have a minimum eligibility criterion that hopeful suppliers will need to meet in order to progress. This varies depending on the tendering procedures selected by the buyer.

Before you begin

Before you begin tendering in business, you should set your business expectations. Being realistic about what contracts you’re going for can help optimise your chances of success. Before you begin, ask yourself:

• Does my business meet or exceed the technical skills required?
• Do I have the necessary experiences?
• Does the contract fit into my business strategy?
• Can my business afford to spend the time and resources on the application?
• Do I have the time and resources to actually supply the contract?
• Will this contract help my business grow?

The tendering process

There are a number of tendering processes depending on the buyer’s needs. They can choose how to procure a good or service. There are two main processes that are used. They are as follows:

1. Open tendering procedure

The open tendering procedure is frequently used within the public sector. It’s used to procure fairly ‘simple’ goods or services. For an open tendering procedure, buyers are allowing any business to bid for their contract. The process looks like this:

An ITT is released

A buyer would release an invitation to tender (ITT). Any prospective supplier can respond with how they intend to fulfil the contract. In their response, they are persuading the buyer that they’re the best business for the job.

Once the responses have been evaluated, the contract will be awarded. If you are tendering in the public sector, the award will go to the most economically advantageous tender (MEAT).

2. Restricted procedure

A restricted tendering procedure is used for more complex commodities. As they are usually of a higher contract worth, a buyer implements a vetted procedure. This is to ensure that prospective suppliers are qualified to carry out the work.

They set eligibility criteria that suppliers have to meet in order to qualify. This stage can be referred to as a pre-qualification questionnaire (PQQ) stage. It also can be known as a selection questionnaire (SQ) or PAS91 (specifically used in the construction industry).

The PQQ/SQ stage involves a business being asked for their company:

• Turnover
• Insurance policies
• Non-collusion
• Qualifications and accreditations

After this has been passed, the supplier will then be shortlisted and progress to an ITT. Once again, they will respond in line with the specification. They’ll detail how they intend to deliver the contract and why they’re the best business for the job.

Once they’ve been evaluated, the contract is awarded.

Sector-specific requirements for tendering in business:

Depending on the sector your business is in there may be different requirements or expectations when tendering for contracts. Framework Agreements and Dynamic Purchasing Systems (DPS) are more common in some sectors than others, for example.

Framework agreements

A framework agreement is a type of multi-supplier agreement that’s frequently used within the public sector. Frameworks can run for years at a time. They are a good way to secure a pipeline of work for your business, if successful. Some may even have the possibility of an extension. They are most frequently found within the following sectors:

• Construction
• Healthcare
• Facilities
• Technology.

They are split into lots with each lot representing a specific good, work, service or geographical location. This allows suppliers to apply to the specific lots they specialise in or the region they operate in. Depending on the tender agreement, a supplier may be eligible to apply for more than one lot. If this is the case, you’ll need to be prepared to provide evidence. You’ll have to demonstrate that your business has the capacity and resources to undertake the works across the selected lots.

Dynamic Purchasing Systems

A Dynamic Purchasing System is similar to a framework agreement in the sense that they are multi-supplier agreements. Again, DPS’ can run for multiple years at a time and are used by public sector organisations. We have seen DPS’ that have been open for 10 or more years. There are two main differences between a DPS and a framework:

1. Suppliers can a DPS join at any time while it’s open
2. It is a completely electronic process.

The following sectors often have tendering opportunities in the form of DPS’:

• Healthcare
• Facilities
• Logistics
• Technology
• Creative.

The process often starts with a pre-qualification questionnaire (PQQ) or selection questionnaire (SQ). This is done to narrow down those who will be sent an invitation to tender (ITT). The PQQ and SQ stage is mainly comprised of capability and competency-based questions. Buyers will likely ask for your company’s policies and statements of non-collusion and other box-ticking exercises. This includes stating any grounds for mandatory exclusion and so on. This is the initial stage of tendering for a DPS.

Once a business has passed the first stage, it will progress onto the ITT stage. This is when your business will answer more technically focused questions on how you will carry out the contract.

Successful suppliers will receive a place on the DPS and then a range of tenders will be released. This streamlines the process for both buyers and suppliers as they don’t need to resubmit a PQQ or SQ.

Spot provider frameworks

Spot provider frameworks are used within the healthcare industry and are a great way to help your business grow. Securing a place on the framework can guarantee income, secure a pipeline of work and enable you to gain experience. These are just a few advantages of tendering.

A spot provider framework is a great way for your business to gain experience if it’s relatively new. This is important as the more experience you have as a company, the bigger the tenders you can go for. This can help your business grow. Almost every tender will require you to demonstrate your capabilities via case studies. A buyer will usually require up to three case studies within the last five years.

Such case studies should demonstrate previous contracts your business has fulfilled. They should be similar in scope, scale and complexity and location where possible. They should be relevant to the contract at hand. Depending on word count, adding a testimonial from previous happy clients will strengthen your response.

Pseudo Dynamic Purchasing Systems

Pseudo Dynamic Purchasing Systems (PSPS) or pseudo-DPS, can be found within the healthcare sector. It is a type of online procurement tool used by NHS England. It includes a list of pre-approved GP providers that can be invited by local commissioners to deliver local GP services.

Where can I find tendering opportunities for my business?

Now you know what tendering is in business, you might wonder where you can find tendering opportunities. There’s no shortage of websites offering multi-sector tendering opportunities and leads. Ideally, you should be searching for a sector-specific portal that posts unique, public and private sector opportunities.

Simply relying on CPV codes can result in missed opportunities as they are often mislabelled. Finding a portal that uploads and categorises tenders by keywords, location and budget and more can streamline the process. Our sister company, Hudson Discover, hosts 11 sector-specific tendering portals. One centralised and easy-to-navigate portal can help you save time, streamlining the process.

These sectors consist of;

• Healthcare Tenders
• Creative Tenders
• Facilities Tenders
• Construction Tenders
• Technology Tenders
• Logistics Tenders
• Research Tenders
• Consultancy Tenders
• HR Tenders
• Finance Tenders
• Hospitality Tenders

Once signed up, you’ll have access to your own dedicated Account Manager. They’ll be able to answer any more questions you may have about what tendering is in business. You’ll also get an email alert when new and relevant tenders are uploaded to your sector.

The benefits of tendering for work

Now you know what tendering is in business, you may be wondering what the benefits of tendering are. There are a number of advantages for your business. These can include:

• Securing a pipeline of work. If you secure a place on a DPS or framework as mentioned above, you can secure a pipeline of work. This will ensure that you have business opportunities.
• Guaranteed pay (in the public sector). The Crown Commercial Service must pay contractors within 60-days of invoicing to comply with the Prompt Payment Code. This gives suppliers peace of mind, especially for first-time winners.
• Increased experience. The more contracts you win, the more experience you have. The more experience you have, the bigger contracts you can go for. The bigger contracts you go for, the bigger you can grow your business.

Need help when tendering for work?

No matter the sector you’re in, buyers care about the quality of your tender response. If writing isn’t your forte, then outsourcing to bid writing experts can help get you on the path to success. Not everyone has the time, resources or experience to write a winning response. Here at Hudson Succeed, we pride ourselves on being bid writing experts.

We hold an 87% success rate and have over 60 years of collective bid writing experience. They know how to win a tender. We offer four levels of bid writing support to suit every business need. Whether you’re completely new to tendering, or need a response proofread before you submit – we can help. The services on offer include:

Tender Writing

Once you’ve found the perfect bid for your business, send it our way. Our Bid Writers can take care of the whole thing for you they’ll even submit it on your behalf. They’ll let you know what they need from you, providing you with a full Tender Writing breakdown. Tendering for contracts and understand the tendering process can be difficult to get your head around.

Tender Ready

Our Tender Ready 4-week programme is perfect for businesses that have never tendered before. A Bid Writer will work with you to ensure you have everything in place to tender successfully. Tender Ready offers your business:

• A 12-month subscription to one Hudson Discover
• Access to Global Bid Directors and Senior Bidding Professionals.
• An Organisation-wide Bid library, including 3 case studies, 5 CVs and policies.
• Additional flexible benefits.

Tender Improvement

If you’ve been tendering but aren’t seeing success from your current efforts, our Tender Improvement package can help. Our Bid Team will assess your previous responses and tender documents. They will work with you to improve for future submissions. This package includes a 12-month subscription to a Hudson Discover portal and additional tendering development services.

Tender Mentor

If you’ve written your own tender response and need it double-checked for errors, Tender Mentor can help. A Bid Writer will proofread your work for any inconsistencies, grammar or spelling mistakes. They will also ensure it’s in line with the specification before you submit.

Discover Elite

Upgrading to Discover Elite can help optimise your tendering efforts – even when you’re busy. Our two new time-saving tools can improve your competitor awareness and success rate when bidding for a contract.

The Ultimate Time Saver package offers your business:

• A maximum of five tender breakdowns per month.
• An annual subscription to a maximum of two Hudson Discover sector-specific portals. This option can help businesses that overlap two industries such as Healthcare and Technology, for example.
• Pre-market and award engagement notices monitored on your behalf.
• Buyer portal management, including registration, password management, downloading documents and assessing viability based on your bid or no-bid strategy.
• Weekly phone calls with your dedicated Account Manager to discuss viable tendering opportunities.

The Become a Pre-Bid Master package also includes:

• All of the above.
• Up to seven tender breakdowns per month.
• A Bid Strategy delivered by a Senior Bid Manager with a minimum of 5 years of experience. It will also be managed by our Global Bid Director.

Contact us to find out how we can help your business grow.

Find more helpful tips and advice in our blogs. We cover topics including:

• How to win a tender
• What is a Bid Writer?
• The tendering process
• Writing winning bids
• 7 tips for tendering for contracts
• Tips for bid management
• Bid writing services
• The types of tendering procedures
• Writing bids
• Bid writing consultants
• Submitting a tender response
• And many more.

The post What is Tendering in Business? appeared first on Tender Consultants.

Here we go again – another term which is not well known in all industry sectors across the UK – a Dynamic Purchasing System.

As always, we are here to help you understand all these ‘niggly’ bits to tendering, to ensure you are prepared to undergo some serious business development planning across your sector and beyond!

You can see the different bidding terminologies applicable in our ‘Tendering doesn’t have to be complicated’ blog. 

In a nutshell – a Dynamic Purchasing System (or DPS for short) is basically a supply chain list where tenders or other bidding opportunities are published to specific members that have been successful in maintaining a position on that list.

As quoted in the Public Contracts Regulations 2015, “[a] DPS should be set up for identified types of requirement, which may be divided into categories of products, works or services.”

This could be any organisation or group of organisations, who wants to outsource work in either one or more service areas [or LOTs] and rather than having 50-100 applications come through for the [potentially many] tenders they publish, they start by narrowing down a set-list of applicants onto their own DPS.

Differences between Dynamic Purchasing Systems & general tender processes

The main differences from the typical tender process are that a Dynamic Purchasing System is to:

• Be run as a completely electronic process (no paper or posting required here)
• Allow new suppliers to join at any time (meaning that if you have been unsuccessful at securing a place – you can always try again in the future)
• Show longevity in its run (we’ve come across DPS’s which are open for 10 or more years).

All that suppliers would need to do, is register their company onto this DPS online, click which service area they are interested in delivering and undergo a Stage 1 submission in order to secure a place. Once secured, Stage 2 is the actual tendering of the works in question.

For example – A Housing Association could create a DPS for their outsourced Creative activity, which includes a range of service areas/LOTs – i.e. Branding, Printing, Website Hosting etc. They would publish this DPS opportunity to all and then undergo multiple stages to narrow down the process of awarding the work via the ‘most economically advantageous tender’ (MEAT).

Stage 1

In the average UK tender process, a lot of suppliers may be asked to complete a Pre-qualification Questionnaire (PQQ) to help the buyer narrow down their list of Invitations to Tender (ITT). This is now being taking over by a ‘Selection Questionnaire’ on many portals. It’s similar with a Dynamic Purchasing System – the supplier has to get onto the DPS in order to be Invited to Tender for works and they do this by completing a Stage 1 application process that heavily resembles a PQQ, with maybe a few additional questions thrown in.

Like a typical PQQ-to-ITT process, securing access to the DPS reflects a ‘weed-out’ procedure, with the buyer ensuring they progress all applicants who demonstrate greater strengths in their financial, technical and professional capabilities.

Stage 2

Once you are successful and Stage 1 is complete – it is complete. You do not have to re-do any capability and competency-based questions. Every time a tender is published in relation to your service area, as part of this Dynamic Purchasing System, you are automatically invited to tender and answer all questions specific to that service!

Once on the DPS then a range of tenders will then ensue (as and when required), allowing the buyer to streamline a more technically-focused evaluation on the responses collated.

Where we stand in all of this!

Our Discover platform has many traits of a Dynamic Purchasing System, in that a buyer, let’s, for example, say a design agency on our Creative Tenders portal, seeks a professional company who can support their financial/accountancy needs. All that the design agency would do is:

• Log on to Hudson Discover
• View a list of our Finance Tenders subscribers, which encapsulates a large list of accountancy firms
• Publish their ‘private opportunity brief’ to a filtered list of suppliers
• Receive responses, evaluate and award.

The reason we filter this list is to avoid publishing opportunities that bear minimal relevance to our suppliers and streamline the process for our buyers, helping them publish specific competitive opportunities to the most competent suppliers.

Writing winning bids can take a lot of time. If you don’t have that to spare, but still want to tender for contracts we can help. Our Bid Writers have an 87% success rate and over 60 years of collective experience.

So, if you ever come across a DPS that contains services specific to your offering – get on board.

Our Consultants can help you succeed!

Need assistance when writing your next bids and tenders?

Now you’re a bit more familiar with what’s required, you may be looking for some writing support. Writing isn’t everyone’s strong suit and that’s ok. Outsourcing a bid you’ve found to bid writing specialists can help you secure that next contract.

Here at Hudson Succeed, we pride ourselves on being bid writing experts. We hold an 87% success rate and have over 60 years of collective bid writing experience. We offer four levels of bid writing support to suit every business need. You may not need the whole bid written for you; you may simply need it proofread before you submit. We can help with that. Our services include:

Tender Writing

Once you’ve found the perfect bid for your business, send it our way. Our Bid Writers can take care of the whole thing for you they’ll even submit it on your behalf. They’ll let you know what they need from you, providing you with a full Tender Writing breakdown.

Tender Ready

Our Tender Ready 4-week programme is perfect for businesses that have never tendered before. A Bid Writer will work with you to ensure you have everything in place to tender successfully. Tender Ready offers your business:

• A 12-month subscription to one Hudson Discover
• Access to Global Bid Directors and Senior Bidding Professionals.
• An Organisation-wide Bid library, including 3 case studies, 5 CVs and policies.
• Additional flexible benefits.

Tender Improvement

If you’ve been tendering but aren’t seeing success from your current efforts, our Tender Improvement package can help. Our Bid Team will assess your previous responses and tender documents. They will work with you to improve for future submissions. This package includes a 12-month subscription to a Hudson Discover portal and additional tendering development services.

Tender Mentor

If you’ve written your own tender response and need it double-checked for errors, Tender Mentor can help. A Bid Writer will proofread your work for any inconsistencies, grammar, or spelling mistakes. They will also ensure it’s in line with the specification before you submit. This is a great way of improving your skills and understanding of how to polish your tender.

Discover Elite

Upgrading to Discover Elite can help optimise your tendering efforts – even when you’re busy. Our two new time-saving tools can improve your competitor awareness and success rate when bidding for a contract.

The Ultimate Time Saver package offers your business:

• A maximum of five tender breakdowns per month.
• An annual subscription to a maximum of two Hudson Discover sector-specific portals. This option can help businesses that overlap two industries such as Healthcare and Technology, for example.
• Pre-market and award engagement notices monitored on your behalf.
• Buyer portal management, including registration, password management, downloading documents and assessing viability based on your bid or no-bid strategy.
• Weekly phone calls with your dedicated Account Manager to discuss viable tendering opportunities.

The Become a Pre-Bid Master package also includes:

• All of the above.
• Up to seven tender breakdowns per month.
• A Bid Strategy delivered by a Senior Bid Manager with a minimum of 5 years of experience. It will also be managed by our Global Bid Director.

Contact us to find out how we can help your business grow.

Find more helpful tips and advice in our blogs. We cover topics including:

• How to win a tender
• What is a Bid Writer?
• The tendering process
• Writing winning bids
• 7 tips for tendering for contracts
• Tips for bid management
• Bid writing services
• The types of tendering procedures
• Writing bids
• Bid writing consultants
• Submitting a tender response
• And many more.

The post What is a Dynamic Purchasing System? The DPS in Tendering! appeared first on Tender Consultants.