Winning government tenders: The six most common errors

Each year the federal and state governments’ combined spend on goods and services within Australia is over $150 billion.

Government procurement exists in many forms, including contracts, tenders, Request for Quotes (RFQ’s), and grant programs.

Most smaller businesses don’t consider the government a realistic target market, and instead rely on their traditional customer-base to secure revenue. For many this is a mistake — put simply, there has never been a better time for smaller businesses to target and win government business.

Opening the government door usually means many hours of work above and beyond their core business, frustrating rejections, and often tedious requirements to fulfil. Alarmingly, more than half of the submissions aren’t even assessed. This can be soul-destroying for small business owners, but it can be avoided with some foresight and determination.

A scary statistic

Almost 60% of formal submissions made to the government don’t conform and cannot be considered. Now this figure varies a little from state to state, but only minimally.

Some states sit around the high 50s, others low 60s. However, roughly six out of 10 formal submissions aren’t assessed or even read because they don’t conform with the tender specifications.

To a big business this isn’t necessarily a big issue. They spread their risk across many areas, and when one tender falls over as non-conforming they usually have several other irons in the government business fire. But for a small business that dedicated so many hours of work into its proposal, this non-conforming outcome puts many off ever submitting for government business again.

Interestingly, many factors behind non-conforming submissions are relatively simple, and can be avoided with a touch more effort.

Let’s take a look into the main reasons behind why so many submissions put to government are deemed non-conforming.

1. No signature, no deal

The clock is ticking and you’re not sure if you’re going to make the submission deadline. You’re scrambling to complete the final sections, and just manage to send your proposal away before time runs out.

Distracted as time ticks by, you neglect to add your signature in all of the required places. Guess what? Your proposal doesn’t comply, likely won’t be read, and certainly won’t be considered. No signature usually means it’s not valid.

Result: non-conforming.

You’d be surprised how often this seemingly small oversight happens. However, missing signatures is quite common, yet so easily avoidable.

2. Time is of the essence

It’s deadline day and you know your submission deadline is 2pm. Just like your school years, you’ve left it to the last day to submit, but you have no real concerns. You finish off the last touches, make a few small changes, then at 1.30pm you click send, with 30 minutes to spare.

You sit back for a minute, relax, and congratulate yourself. Then a sickening feeling comes over you, and as you scramble to refer to the initial tender documents again, you realise the deadline time for submission is 2pm AEDST!

If you’re in Queensland, your work will officially be recorded as being submitted after the 2pm deadline! You quickly call and email the department contact to explain the situation. Sadly, they regrettably inform you that any proposals to be submitted must adhere to the specified times.

Result: your submission is non-conforming, and will not be considered.

Cover your bases and aim to have any proposals finished (and sent!) at least a couple of days before the noted deadline.

3. Blank space is dead space

You’re diligently and methodically composing responses that are required in the tender documents. Some are simple, such as your company’s ABN, while some are not-so straightforward. You analyse a section that has a question almost identical to one you’ve already provided a detailed response.

To save time, you reach a seemingly logical conclusion, and provide a response similar to this: ‘See response to question 1234’. Your response to both sections is the same, hence your decision to refer to the previously answered section.

Result: your submission is now incomplete, non-conforming, and can’t be considered any further.

You must answer every question, regardless of how many times it seems to be repeated.

Many business professionals don’t understand what happens once a huge number of proposals flood procurement’s inbox on deadline day. Often, tender responses are pulled apart into sections, with panel personnel only given a small chunk of a tender response to assess. They can’t assess responses that simply refer to a previous completed section, as they might or might not have been given it in the first place. Responses like this are more often than not deemed non-conforming, and further deliberation no longer necessary.

Provide a response to every section, no matter how tempting it might be to refer to previous sections.

4. Change the format at your own peril

I’ve lost count of how many government officials have told me they couldn’t consider a particular proposal because the submitting company chose to use a different format for their response.

Most tender documents provide the formatting required for responders. It’s usually stated pretty clearly that this format is to be used by any business looking to secure the contract.

They want a pricing schedule in Excel with their own headings? Don’t get fancy; use the format provided. They request value-adds to be listed in alphabetical order with calibri 11-point font? Do it.

If you want to comply and give yourself a chance of getting through, then follow the format outlined in the initial tender document.

5. Collude and you’re out

You know that only one or two companies — including yourself — can effectively fulfil a released contract. This being the case, after a few meetings, you all agree to put forward pricing that is virtually identical, with inflated profit margins.

Perhaps there’s even plans for the winning company to ‘share’ the work so all three companies can benefit.

The assessment panel realises something is amiss and investigates. They determine there’s been collusion between the three companies involved.

Result: non-conforming and not considered.

Collusion of this nature isn’t usually driven by SMEs — it’s normally the domain of big business and larger contracts. But any form of collusion that can be substantiated all results in the same outcome: you won’t be considered for this business, and it could also harm your chances of securing future government contracts.

6. Address all mandatory requirements

Tender specifications will almost always indicate whether a requirement is mandatory, or desirable. Successful bidders will have addressed all mandatory requirements, which can include delivery, performance, timeframes, technical specs, regulations, accreditations, among others.

You missed one? Result: non-conforming, and not considered.

Common mandatory requirements

Your ABN.
A company profile and capability statement.
References from reliable sources.
Whether you propose to subcontract.
The price for each product or service you offer, and an indication of whether these are fixed or variable (based on exchange rates or consumer price index variations).
Any conditions affecting the price.
Delivery details and charges.
A proposed schedule stating meetings, progression, and delivery dates.
Whether goods or services are periodic or recurrent.
GST and other taxes.
Applicable insurances.
Intellectual property rights (where relevant).
A description of any variations you propose in meeting the conditions of the contract.