Posted on 28-06-2011 at 01:00
Tender Writing
Tender Writing and the true cost from overselling
When writing a tender in a competitive tender environment, it is tempting to overstretch the abilities or resources of your organisation in order to convey a better impression to the buyer. Competitive advantage is not always easily to demonstrate and a lack of knowledge about your competitors’ offering can drive even the most honest tender writer to utilise poetic license. While the odd exaggeration will hardly act as a detriment should you win the contract, there are a number of factors to be wary of if you are tempted to stretch the truth beyond its elastic capabilities.
Getting caught out – it would be a hugely embarrassing outcome for your organisation if you were interrogated further on any flamboyant claims made during the tender writing process and you could not support them with substance. Not only will this almost guarantee you won’t end up winning the tender, it will reflect badly on you, the writer, and your organisation.
Failing to deliver – Overambitious tenders can win. It is the devastating effects on both the buyer and tendering party in the aftermath that causes problems, when words are expected to be put into action. Winning a contract you are not in a position to fulfil, as per your tender, can be fatal for your organisation. Whilst ‘winging it’ is sometimes an option, for example, if you promise a system you can’t deliver then pull out all the stops to present it on winning, you may get away with overselling. However, failing to deliver on your promises can not only result in financial ruin for your organisation when contract penalty clauses are invoked, you may find winning future business impossible. In the private sector, word gets round fast amongst buyers. In the public sector, failure to meet contractual obligations is well publicised. Negative publicity or word of mouth can ruin businesses or at least make it very difficult to trade.
Losing money – If you are going to offer excellent value for money, ensure you can afford it. The other extreme of failing to deliver is delivering to the financial detriment of your organisation. Whilst it is admirable of a company to keep to the promises it made during the tender process, why tender at all if you can’t make any profit as a result of too many promises for too little reward?
Facing the courts – perhaps the most extreme downside of overselling and winning a tender on that basis is that you could find your organisation in the midst of legal action. What bidders sometimes fail to recognise is that your unattainable promises can cost your client if you are unable to meet your obligations. Where the courts generally do not intervene in commercial contractual disputes, they are more likely now than ever to step in where a supplier has misrepresented their abilities or resources in order to gain unfair advantage and win tenders they would otherwise have lost. The recent court cases of BskyB v EDS and Kingsway Hall Hotel Ltd V Red Sky IT Ltd show that the legal system can be invoked where misrepresentation occurs before a contract is signed (EDS) and that ‘Quality’ and ‘Fit for Purpose’ need not be limited to the Sale of Goods Act 1979 (Red Sky IT). Be aware that if you win a tender on false pretences and it then goes on to cost your client more money that they had planned that the above two cases show you can be sued for substantial sums.
Getting caught out – it would be a hugely embarrassing outcome for your organisation if you were interrogated further on any flamboyant claims made during the tender writing process and you could not support them with substance. Not only will this almost guarantee you won’t end up winning the tender, it will reflect badly on you, the writer, and your organisation.
Failing to deliver – Overambitious tenders can win. It is the devastating effects on both the buyer and tendering party in the aftermath that causes problems, when words are expected to be put into action. Winning a contract you are not in a position to fulfil, as per your tender, can be fatal for your organisation. Whilst ‘winging it’ is sometimes an option, for example, if you promise a system you can’t deliver then pull out all the stops to present it on winning, you may get away with overselling. However, failing to deliver on your promises can not only result in financial ruin for your organisation when contract penalty clauses are invoked, you may find winning future business impossible. In the private sector, word gets round fast amongst buyers. In the public sector, failure to meet contractual obligations is well publicised. Negative publicity or word of mouth can ruin businesses or at least make it very difficult to trade.
Losing money – If you are going to offer excellent value for money, ensure you can afford it. The other extreme of failing to deliver is delivering to the financial detriment of your organisation. Whilst it is admirable of a company to keep to the promises it made during the tender process, why tender at all if you can’t make any profit as a result of too many promises for too little reward?
Facing the courts – perhaps the most extreme downside of overselling and winning a tender on that basis is that you could find your organisation in the midst of legal action. What bidders sometimes fail to recognise is that your unattainable promises can cost your client if you are unable to meet your obligations. Where the courts generally do not intervene in commercial contractual disputes, they are more likely now than ever to step in where a supplier has misrepresented their abilities or resources in order to gain unfair advantage and win tenders they would otherwise have lost. The recent court cases of BskyB v EDS and Kingsway Hall Hotel Ltd V Red Sky IT Ltd show that the legal system can be invoked where misrepresentation occurs before a contract is signed (EDS) and that ‘Quality’ and ‘Fit for Purpose’ need not be limited to the Sale of Goods Act 1979 (Red Sky IT). Be aware that if you win a tender on false pretences and it then goes on to cost your client more money that they had planned that the above two cases show you can be sued for substantial sums.
