What is a Tender?

What Is a Tender? A Tender Definition Explained

A tender, also known as an invitation to tender, a request for tender or a bid, is a formal, structured process for procuring goods or services. A tender can come in many forms and sizes, depending on the preferences of the buyer and the level of detail required to make an informed contract award. Generally, a tender is split into two elements on which a bidder is evaluated: price and quality. The four main types of tender exercises are outlined below:

Types of Tender:

• Open tender: This type of tender is open to all interested suppliers or contractors who meet the pre-qualification criteria. It is publicly advertised on sites such as Contracts Finder, allowing any eligible bidder to submit their proposal.
• Restricted tender: In a restricted tender, only a select group of suppliers or contractors are invited to submit proposals. The invitation is based on pre-qualification criteria or a shortlisting process.
• Single-stage tender: In a single-stage tender, the procurement process involves a single step. Bidders submit their technical and commercial proposals together in response to the tender advertisement.
• Negotiated tender: In a negotiated tender, the buyer engages in direct negotiations with one or more suppliers or contractors. This type of tender is usually used for specialised or complex projects where the buyer seeks customised solutions or requires input from potential bidders during the tendering process.

To find out more about the types of tenders, read our previous article.

Tendering from the Buyer’s Point of View:

The buyer (i.e. housing authority, local council, central government department, etc.) requiring goods/services will issue a contract notice to the market. Typically, this will include details such as the scope, range, value, geographical location and other contract conditions of the works or services, so bidders understand the work in question and can make an informed assessment of whether it is suitable for their business.

If the buyer is in the public sector and the contract is over a specific amount, they are required by law to issue a call for tenders. Sometimes, a group of authorities will get together to form a purchasing consortium to issue a request for tenders via a framework agreement or dynamic purchasing system. Like a cooperative, they’re hoping that by combining their services and advertising a large contract, they can get better value for money from their suppliers for goods or services. The buyer will ask potential bidders for expressions of interest, followed by a standardised pre-qualification questionnaire, and specific information within the tender documents comprised loosely of a pricing and quality element.

Tendering from the Bidder’s Point of View:

What is a tender in the eyes of a bidder? Your organisation and other potential suppliers will submit bids for the live contract opportunity, essentially acting as applications to deliver works. Some bidders will be disqualified at the first stage due to non-compliance or not meeting minimum criteria, whilst others will proceed to the pre-qualification stage (used to assess capabilities/experience), and fewer still will be asked to complete the full tender response documentation. After the buyer has evaluated the tender submissions, one supplier (or more if the contract is a framework) will be awarded the contract. This is known as the bidding process.

Typically, the organisation wanting to bid for a contract opportunity will come to Executive Compass because they have a live tender to complete. Services could range from the construction of a modular build office to the supply of home care services or grounds maintenance for a housing association. There are several reasons organisations choose to use a bid writing service, such as limited in-house capacity to complete the project, lack of tendering experience, or simply lack of resources, therefore outsourcing the process. With a typical turnaround time of around five to six weeks, we are highly experienced at responding to open tenders while adhering to tight, inflexible deadlines.

Where are Tenders Published?

Relevant legislation such as the Public Contract Regulations 2015 requires government tenders to be subject to a fair, transparent bidding process, which includes the publication of contract notices for all qualifying tender opportunities. This means that, unlike private sector contracts and opportunities, the vast majority of public sector requests for tender will be hosted in a free-to-use, publicly accessible location.

Contract notices will be published on the following websites:

• Contracts Finder – open tender notices for all public sector contracts with a value exceeding £12,000 (including VAT) for England and non-devolved bodies, such as HMRC or the UK Border Force, and £30,000 for subcentral authorities like local councils and schools.
• Find a Tender – hosting tender notices for high-value public sector contracts in the UK with a lifetime contract value exceeding £138,760, as per the newest update from PPN 01/23.
• Your local council – like central government, local authorities such as London borough councils or Newcastle City Council are obliged to post contract notices for tenders, which are normally available on the business and commerce sections of their websites.
• Specialist procurement groups – buyers often outsource the bidding process to groups such as Pagabo, LHC, NEPO and YPO who will advertise tender opportunities on their websites.

Scotland, Northern Ireland and Wales have their own procurement websites, for tender opportunities within their devolved administrative boundaries. Occasionally, different regulations for the bidding process apply – for example, Scottish buyers use the SPD instead of the Standard Selection Questionnaire used by central government bodies and devolved English authorities.

To receive notices for contract opportunities, you can sign up for notifications on relevant portals and websites. This can be tailored so you can receive relevant updates based on the types of works or services you offer and the geographic region in which you operate and can cover.

What is Involved in the Tendering Process?

Although the tendering process will vary slightly depending on the contract, it typically involves the following stages:

1. The tender is advertised and bidders must register their interest to access the tender documents.
2. The tender submission – this stage involves completing a tender document explaining how you will deliver the contract.
3. Tender evaluation – following submission, the buyer will assess the tender submission and select the winner of the bidding process, in accordance with the prescribed evaluation criteria found in the tender documents.
4. Notice to award – applicants are informed of the outcome, and a 10-day standstill is put in place for applicants to appeal the decision.

To find out more about the tendering process, see our Simple Facts About The Tendering Process article.

How is the Tender Process Marked and Why is It Marked This Way?

The tender documents typically include a table detailing how marks are awarded – for example, full marks are awarded to tender responses that address all of the requirements in detail, with lower marks awarded where elements of the question have either not been answered, or not answered in sufficient detail. Marks are then accumulated across the quality responses, with overall marks distributed based on the percentage weighting.

For the pricing element, the process typically follows a ‘most economically advantageous tender’ whereby the lowest price is awarded top scores, with incremental decreases applied to other bidders. The two scores are then combined to identify the winning tender.

A tender is evaluated this way to ensure transparency and fairness. All suppliers will be marked against a scoring matrix to ensure the company that offers the best value for money, products and/or services will be appointed as a supplier via a formal offer. This is particularly important when it comes to spending the public’s money, so it is not just evaluated on the bid price.

What makes a quality tender submission?

As a business, you must impress the contracting authority and really stand out from the competition throughout the bidding process. Your tender document should answer exactly what they ask, reflect the tender requirements and use innovative ideas or added value you will bring to the contract to stand out. When it comes to tender writing, this may fall to the business development team or you may have a dedicated bid writer within your organisation. Whoever is in charge of the bidding process must be aware of the procurement procedures and have exceptional writing skills to ensure the tender submission is completed to a high standard.

How we can help

We have a range of resources to help you understand how to win a tender.

Executive Compass can support you with the entire tendering process, from education – so you no longer have to question ‘what is a tender’ – up to full tender writing training, and our full bid and tender writing services for companies across all sectors. With over 14 years’ experience, we have successfully assisted our clients to win public and private sector contracts. Contact our bid and tender consultancy specialists now to find out how our tender services could benefit your company. Now you know what a tender is, get responding to those requests for tenders to grow your business!

Download our free PQQ, bid and tender resources for your business here.

How we Support Clients with Bids and Tenders

We offer comprehensive bid and tender services tailored to the needs of your organisation and your overall bidding strategy. As an overview, this includes the following:

• Bid writing services – Our bid writing services allow you to outsource the bidding process to experts, including ‘must-win’ and business-critical tenders. Each of our bid writers completes dozens of tenders every year and has extensive familiarity writing tenders across a range of industries, including health and social care, construction, facilities management and professional services.
• Bid review services – Many of our clients opt for a review service, where responses are subject to our internal quality assurance processes. Quality responses are subject to a line-by-line review and returned with comments suggesting enhancement and improvements, giving additional surety and peace of mind that you have produced a compliant, competitive and persuasive tender.
• Bespoke bid training courses – We provide interactive, engaging and CPD-accredited bid tender writing courses for up to 20 delegates, with a structure agreed in advance tailored to your requirements. Beginner and intermediate/advanced level courses are available, dependent on your overall experience and the volume of tenders you complete per annum.
• Social value support – In recognition of the increased emphasis placed on social value in government tenders, our in-house specialist Social Value Practice was established in 2020, providing consultative advice and writing support regarding social value commitments within the bidding process.

The above services can be combined to create a truly bespoke service, tailored to the specific requirements of the tender for which you are bidding. Once the scope of works has been determined, we will work collaboratively to produce a unique quotation for your consideration.

Bid Management Support and Sourcing Tender Opportunities

The scope of our services also extends into wider bid management support and a consultative approach for our clients. This can comprise:

1. Checking your organisation’s certifications and accreditations against mandatory criteria, ensuring you are eligible to bid
2. Providing detailed but easily digestible explanations of the bidding process
3. Helping to navigate complex procurement portals and uploading tender documents in the correct format and location
4. Identifying relevant opportunities published on Contracts Finder and Find a Tender for your consideration.

As consultants, we can also provide information on what the authority will expect from potential bidders, strengthening your ‘bid/no-bid’ decision and ensuring you have the highest possible chance of success. We aim to support clients throughout the bidding process in a fair, transparent manner, with the strength of our support evidenced by our 85% success rate and 75% repeat business.

Why choose Executive Compass

Are you asking yourself ‘What is a tender?’ Or unsure how to complete a submission? Help is at hand; the Executive Compass team provide comprehensive bid and tender writing services for companies across all sectors. As well as outlining the tender process, we will ensure you are fully equipped with the knowledge and skills to successfully bid for contracts in your sector. Keep reading to find out more about tender writing.