You’ve done it! You’ve worked hard, the tender writing is over, you have done your research and your tender has been submitted. You might think now is the time to relax and await that fateful phone call.
Has your tender writing been successful? Did the client like your proposals, prices and quirky writing style? Or have you been pipped to the post by a close competitor?
What you might not be expecting is the call that invites you for post-tender negotiations. This means further discussions and potential adaptations to your ‘finalised’ offering. This will always take place prior to a contract being offered as EU rules do not allow re-negotiation of contracts once agreed, providing the tender falls within the coverage of EU rules (most do).
Post-tender negotiations are often called for, where the client is not overwhelmed by the proposals of their finalists or finalist. There are other reasons too, for example, where there is only one potential bidder who is effectively naming their price. It might involve a number of final tenders or even just one. Usually, if you are called back at this stage for renegotiation, then your client likes your overall proposal but feels it needs some tweaking to meet their objectives or purchasing power. It may also be that they need to ensure that you are fully aware of all contractual obligations and requirements where this might not be come through clearly in your tender.
Post-tender negotiations can cover a wide scope, ranging from additions or alterations to your proposal, to re-pricing. The most common reason is pricing, especially during these particular economic times. Clients are more eager than ever to gain additional value for money, either through additional products or services for the price, or more commonly, a reduced price for the given proposal.
It probably seems unfair to have to come back into the pricing stage after you’ve submitted the tender, but think of it as yet another opportunity to win. Your client may have quite easily picked one of your competitors but instead has kept the process open for improved offers. Ensuring that there is room for manoeuvre in your submitted bid should make this process easier for you. Submitting a bid where margins are close to the bone is going to be a disadvantage at this stage as there is little more you can offer, either in terms of value or price.
There are rules that your client must adhere to, however, which makes this stage in the negotiations fairer. Your client must adhere to EU rules as above. They must also have a good reason for initiating further negotiations and keep a documented paper trail. Last, but not least, it must be fair and competitive. It cannot be a ‘Dutch Auction’ where the potential client seeks to drive down your price against your competitors. The whole process must be open, fair and auditable and any changes to your tender must be submitted again in writing.
So whilst it may seem unfair to be dragged back into something you thought had been completed, do see it as a further opportunity to win that tender and do think, pre-tender, about ways you can factor the potential costs of this stage into your final tender.
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