Impress Me: 5 Ways to Make Your Bidding Process More Competitive


Insights for ProfessionalsThe latest thought leadership for Management pros

Tuesday, December 14, 2021

A competitive bidding process will help you procure the goods and services you need at the best price, which could prove crucial to the success of your business.

Article 4 Minutes
Impress Me: 5 Ways to Make Your Bidding Process More Competitive

The procurement department has a key role to play in helping your company succeed by ensuring you can obtain the products and services you need at the best possible price.

One way to achieve this is through competitive bidding, which allows you to inform potential suppliers of your requirements so they can make proposals for you to evaluate. This is an approach that can deliver good results if you go about it in the right way, for example, by ensuring the process is fair and gives all vendors equal opportunities to win your custom.

If you want to encourage positive and healthy competition between prospective suppliers, consider practices you can introduce to optimize the bidding stage.

1. Stay impartial

A key step on the way to creating a more competitive bidding process is encouraging submissions from as many interested parties as possible. To do that, you need to make sure your requests for bids are impartial - in other words, they're planned and presented in a way that invites interest from a wide range of potential partners.

You might have received a good product or service from a particular supplier in the past, but if you're focused on encouraging competition to get a good price, you should be open to approaches from other companies that might do things differently.

Furthermore, be sure to prioritize objectivity in your selection criteria. Make sure the factors you examine to reach your final decision - which could be anything from price and functionality to the experience and credentials of the vendor - are applied equally in every case.

2. Give vendors all the information they need

Another effective way to stimulate competition by inviting proposals from a broad selection of vendors involves making sure you're providing plenty of detail and information in every request you put out.

Responding to these solicitations and putting together an attractive bid can be a time-consuming (not to mention expensive) undertaking for suppliers. It's important, therefore, to do everything you can to facilitate the process, which includes providing relevant details like the key criteria you use to evaluate potential partners.

The easier you can make the bidding cycle, the more interest you're likely to receive and the more competitive this aspect of your procurement operation will be.

3. Be fair and reasonable with deadlines

Not providing enough time for different types of vendors to make a pitch for your business, or extending the bid deadline for some suppliers but not others, could hinder competition in the process by limiting the number of proposals you receive.

It's important to bear in mind that different companies have different ways of working, and the amount of time required to put together and send a bid will vary depending on the nature and complexity of what you're asking for. If you're too strict with your deadlines, you run the risk of limiting yourself to suppliers that have worked with you before and are familiar with your bidding process.

Also, make sure you keep things fair and offer the same benefits and allowances to all vendors, particularly when it comes to extending deadlines.

4. Pay attention to common queries

The most common questions you receive from outside parties can be a valuable resource when you want to optimize your bidding process. They give you an insight into the key pieces of information most suppliers are looking for and can help you diagnose problems and deficiencies in your regular practices - such as not including sufficient detail in your proposal requests.

When you receive questions that are particularly pertinent or bring your attention to issues you hadn't already considered, make your answer available to all relevant parties. This is important if you want to maintain a level playing field and provide the same information to every supplier you could end up working with.

 5. Be consistent and transparent

Prioritizing consistency every time you go into a new bidding cycle helps to ensure that the process runs as smoothly as possible and interested vendors can make their bids as quickly and efficiently as possible. This is crucial if you want to encourage competition by inviting maximum interest.

Furthermore, be sure to take a clear and transparent approach that gives all suppliers a fair shot at winning your business. Over time, this will boost your brand reputation and help you attract bids from a more diverse range of companies.

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