This article is the second in a three-part series offering a practical guide to tender analysis. Each instalment focuses on a key element of interpreting public sector tenders with insight and precision. Part Two takes a closer look at how to assess the nature of the requirement, current market conditions, and commercial scope – critical factors that inform your pricing, delivery model, and overall bid strategy. If you missed Part One, we explored buyer motivations and stakeholder impact – the foundations of any compelling and tailored bid.
Nature of the Goods, Services or Works Required
Once you’ve understood the broader motivations behind a tender, the next step is to examine the finer details of what is actually being procured. This involves a close reading of the specification to grasp not only what the buyer needs, but how they expect it to be delivered.
Is the requirement a standard, clearly defined product or service, such as a commodity or routine provision – or is it more complex, bespoke, or innovation-driven? This distinction will have a direct influence on how your bid should be shaped. For straightforward requirements, the emphasis may lie in demonstrating efficiency, cost-effectiveness, and reliability.
On the other hand, if it’s a specialist or bespoke requirement, say a custom software development or a unique consulting project, you’ll need to demonstrate niche expertise and possibly a tailored methodology. Look for any specific design or technical aspects mentioned.
For works or services, is there an element of service design or innovation expected, or is it mostly following an established process? Identify any “quirks” or special conditions in the tender documents: legacy systems that your solution must integrate with, particular standards or certifications that are mandatory (e.g. a construction tender might require adherence to a specific building standard; an IT tender might insist on a certain cybersecurity accreditation), or strong sustainability and equality requirements (many public tenders now include social value or green criteria).
These details are critical. Make a checklist of all such requirements and peculiarities. Early in your bid preparations, ensure you have answers for how you will meet each one. This part of the analysis is about confirming what exactly you need to deliver and noting any aspect that will require special attention or could pose a risk. By fully understanding the nature of the goods/services/works, you can avoid underestimating the effort or proposing an approach that misses the mark. Your bid should reflect an appreciation of any complexities involved in delivering the requirement.
Market Conditions and Competitive Landscape
From the supplier’s perspective, it’s also important to assess the market environment in which this tender sits. Consider the supplier ecosystem and competition for this contract. How many other firms out there offer a similar service or product? Is the market crowded with many capable suppliers (making the tender highly competitive on price and features), or is it a niche area with only a few specialists (where you might be one of only a handful of qualified bidders)?
Understanding the competitive landscape can inform how you pitch your bid. In a crowded field, you’ll need to emphasise clear differentiators. In a niche field, the emphasis might be on demonstrating unique expertise or simply meeting all requirements thoroughly if few can. Market conditions also include current trends or external factors.
Is demand for these goods/services rising or falling in general?
Are there any supply chain issues or regulatory changes affecting the market?
For example, if you supply medical equipment and there’s currently a global shortage of certain components, that’s a market condition to consider – it might affect timelines or pricing strategy.
Additionally, consider whether the tender’s scope might encourage consortium bids. If the project is very large-scale (e.g. a nationwide framework) or requires a broad range of services, competitors might form partnerships or consortiums to cover all bases.
This might influence your decision to partner up as well (as discussed in the consortium article). Gauge whether forming an alliance could strengthen your position or if you’re better off bidding alone given the market context.
Finally, perform a bit of competitor analysis: think about who the likely bidders are and what their strengths might be. This can help you identify your own unique selling points to highlight. For instance, if others are bigger but you are more agile, play up responsiveness and innovation. If others have similar offerings, perhaps your local presence or past relationship with the client is an edge. Use your knowledge of the market to anticipate the buyer’s comparison points and position your proposal accordingly.
Commercial Scope and Volume Requirements
A crucial part of tender analysis is understanding the commercial scope – essentially, how much the buyer is asking for. Break down the volume and scale requirements specified. These may include details like:
Quantities or Volume: How many units, how much output, or what throughput is needed? This could be number of items to supply, number of service hours, number of sites to cover, or volume of users to be served.
Service Level Expectations: What performance levels or KPIs are required? For example, do they specify response times, uptime percentages, resolution times, or other quality measures that must be met?
Bespoke vs Standard Mix: How much of the requirement is custom or bespoke to the buyer’s needs versus off-the-shelf or standard solutions? (E.g. are they looking for a customised solution tailored to them, or something you already provide broadly?)
These details give you a quantitative sense of the work and help scope your solution. Make sure you can meet the minimum requirements and consider if you can also handle the upper end if ranges are given (for instance, a contract might have minimum guaranteed volumes but also potential for more – can you scale up if needed?). When crafting your bid, you’ll need to price and resource according to these volumes, so the analysis here directly impacts your pricing strategy and project plan.
Avoid the pitfalls of under-committing or over-committing: if you underestimate volumes, you risk non-performance; if you wildly overestimate or include unnecessary capacity, your bid might be too expensive or uncompetitive. The goal is to align your proposal exactly with what the buyer is asking for in scale. If any numbers are unclear, consider asking for clarification in the tender Q&A stage.
Ultimately, reflecting the tender’s scope accurately in your offer, showing the buyer that “we understand how much you need and we can deliver that” will give evaluators confidence in your bid.
