Increase in Public Sector Contracts Post-Election

The arvato UK Quarterly Outsourcing Index has recently published an increase in public sector spend, average contract value and the outsourcing of contracts, all found in the third quarter of 2015.

General elections always tend to have an impact on the procurement cycle, with this year being no different. The findings suggest both private and public sector organisations have waited until post-election to enter into large deals, with the average contract value up a substantial 269% in Q3 compared to Q2.

Debra Maxwell, CEO of CRM and Public Sector, arvato UK & Ireland, said: “With even greater cuts to funding expected in this month’s spending review, the growth seen across local government will only continue. Councils are increasingly looking to change how they operate and deliver services to leverage significant savings.”

With more contracts available, with longer time spans, SMEs are encouraged to bid for worthwhile opportunities, but the need to demonstrate value for money is more prevalent than ever.

How does this affect bidders?

With over £2 billion worth of contracts signed in the last few months alone, it is fair to assume a lot of companies are already benefiting from the increase in opportunities and SME-friendly directives. Over 50% of contracts in the first quarter of 2015 were ‘first time deals’, representing new work in the market.

With increased opportunities also comes high levels of competition as firms feel more confident to bid for additional, larger value contracts.

Companies completing PQQ and tender documents must be aware of the likely repercussions: a more competitive process, questions designed to purposefully eliminate weaker bids and more firms likely to seek professional assistance.

The increase of confidence in bidding for contracts is good news; however, firms should still undertake a comprehensive ‘bid/no-bid’ decision as it can be a costly process submitting a speculative or rushed bid.

How to tender successfully for larger contracts

It is common practice for companies to start aiming for larger contracts once they have secured a few successful bids. However, making the leap from small, local contracts to larger national frameworks can be challenging due to the recent increase in the average contract value.

It is important to note that your existing bid processes and practices may need to be refreshed and improved in order to tender for larger value contracts, as they are likely to be more competitive and set out to exclude bidders. Ensuring that you have the relevant certifications, such as ISO and SSIP, is crucial to maintaining your place in the bidding process and provides the evaluator no reason to mark down your bid. Having relevant industry certifications can also ease the PQQ or tender process, as you can often bypass certain sections like health and safety, if you already have a proven guarantee in this area – this is almost a given in larger value tenders.

When bidding for larger contracts, you are likely to be up against national, well known firms, meaning it is vital to stand out from the competition. Drawing upon innovations, company techniques and contract-specific examples are useful tools in standing out against your competition.

Professional bid writing support

If you are making the transition to bidding for a larger value contract and would like to speak to our specialist bid writers, please email info@executivecompass.co.uk or call 0800 612 5563 to discuss the range of support that we provide.