Our team at Tracker are often asked how your business can win private sector tenders.
Private sector procurement can offer your business new opportunities that can help develop your business and grow its customer base.
For some businesses, private sector tenders fit better due to the variety of goods and services that are supplied into this marketplace.
To learn more about how your business can win more opportunities, find out more about this lucrative area of procurement below.
What’s the difference between public and private sector tenders?
Private sector tenders are like public sector tenders, but there are some key differences in priorities and regulations with these contracts.
Public sector procurement is typically government-sponsored, be it by central or local government. Private sector tendering, which is also known as supply chain tendering, works differently from public sector procurement as it is governed by fewer regulations which means it is less restricted.
Supply chain contracts
As there are fewer regulatory requirements, many smaller businesses start by bidding for private sector contracts.
Supply chain opportunities work slightly differently from public sector contracts as the buyer is a private sector organisation. Usually, one private sector business will win a large public sector contract and outsource contracts to smaller subcontractors, as they will be unable to supply every aspect of the goods, works or services required.
What you need to know about bidding for private sector contracts
Although the process behind private sector tendering isn’t very different from dealing with public sector tendering, it is important that you grasp the differences between the two. We explain everything you need to know about bidding for private sector contracts below.
There is no legal requirement to publish private sector tenders on a central noticeboard or make the opportunity public.
In most cases how the private sector advertises is based on their own procurement policy. This means they can choose between publishing to the whole marketplace or choose a selection of suppliers to tender. However, companies that win major public sector contracts and then advertise supply chain opportunities are increasingly required by the original public sector buyer to be transparent as public money is involved and the public sector have to be wholly accountable. Transparency generally requires the contractor to advertise to the marketplace and conduct a formal procurement process.
As private sector tenders are not published on any particular central noticeboard, it is vital that your business stays in the loop in other ways.
Business intelligence content provides a wealth of crucial market information and, when used strategically, can help you stay one step ahead of the competition and be more proactive when tendering for public and private sector tenders.
Not only will it help your business to identify new business opportunities early, but market intelligence will also give you access to named contacts and contact details for networking across both the private and public sector. This gets the tender process off to a fantastic start, as your organisation will have access to the key decision makers on tenders.
Start a conversation
With both public and private sector procurement your business should never be afraid to ask questions about the process. The more you know about the process and the buyer’s expectations, the better chance you have of winning the tender.
If you are new to private sector tendering, it is important that you fully understand the process. If anything is unclear, make sure you clarify it (e.g. what are the timescales? Will there be a site visit during the evaluation? Is there a presentation that your business will need to prepare for?). This will relieve any stress around uncertainties.
Although evaluation for private sector procurement is less strict than public sector procurement, contractors want suppliers to meet similar requirements and meet at least some minimum criteria, e.g. financial stability.
If your organisation is unsuccessful when bidding for work with the private sector, then it may not receive the same level of feedback as it would from a public sector organisation, as the buyer is not bound by the same directives. Although a public sector buyer is not legally required to provide feedback, it is still worth contacting them and requesting it. You may learn something that will help your next bid to succeed.
The benefit of working with the private sector is that the government keeps a close eye on their private sector contractors. Government has set a standard that 95% of supply chain invoices should be paid within 60 days for organisations that want to do business with government. Any suppliers that are not being paid on time by a contractor that has itself won a public sector contract can raise complaints and concerns directly to the government through the Public Procurement Review Service.
There are major consequences for contractors that do not comply with the requirements to pay promptly. In 2019 the UK’s Cabinet Office released a statement warning businesses that are not paying their suppliers on time that they could lose out of government contracts next time around.
Winning a private sector contract can be financially rewarding long term. The benefit of winning private sector contracts is that an agreement can be made directly between the buyer and the supplier. Private sector contractors often stay with the same suppliers as they do not need to re-issue and retender as stringently as the public sector.
Show added value
One way your business can differentiate itself from its competition is by showing contractors the added value your business can provide.
Private sector procurement is typically conducted by for-profit organisations; this means that offering the private sector client added value could give your business a decisive edge over the competition.
Private sector buyers are often guided chiefly by the profit motive. If you can offer something unique as part of any potential contract agreement, the client may be swayed towards selecting your organisation. Differentiate your business from your competitors. When you are writing a private sector tender bid, always specify the add-ons which are included in your price. Put yourself in the buyer’s shoes and give them the full picture of what your business can offer. But always remember to meet the actual requirements first and to price realistically – winning business is great but you need to be able to afford any add-ons you offer.
Find private sector tenders with Tracker
Business Intelligence can support your search for opportunities with the private sector.
Within this area of procurement, there are valuable contracts to be won in industries such as construction, IT and healthcare.
The UK’s IT sector has gone from strength to strength in recent years and, with technology advancing faster than ever before, there is no sign of IT contract opportunities slowing down.
As the government searches for suppliers to fulfil its digital transformation requirements, the volume and value of IT procurement has soared, making it a lucrative market place for private sector suppliers.
This category covers a wide range of solutions such as computer-related services, software and hardware services, and telecommunications equipment, and offers opportunities within the supply chain.
With the government providing a long-term funding commitment to the healthcare sector, there is never a bad time to start looking for healthcare tenders.
The government has committed to investment in the technological transformation of the NHS and to achieve this they must work with specialists in the private sector.
If your business can offer expertise to healthcare organisations, or to major contractors within this sector, it should be to be proactively analysing and identifying where the opportunities sit within this area 6 to 12 months ahead of time.
Construction tenders can be won by businesses of all sizes as the sector covers a wide range of services, across several areas, from professional services to building maintenance and refurbishment, as well as civil engineering, landscaping and new-build construction.
The UK’s construction pipeline includes a £600m investment to fund over 700 infrastructure projects across the UK over the next decade which will create thousands of supply chain contract opportunities.
The extraordinarily diverse range of requirements of any construction or infrastructure project make this a fruitful area for those companies seeking supply chain contracts. No contractor, regardless of size or prestige, can supply every part or trade needed for a substantial project, making this an ideal area for a company seeking to break into the supply chain.
Engage with private sector buyers
As private sector buyers do not have to advertise to all suppliers, it makes it difficult for suppliers to find relevant private sector tender opportunities. If a supplier wants to win private sector tenders, then it must ensure that it is doing research around the procurement process and where to find relevant contracts. Therefore, early engagement is key when working with this marketplace.
The main concept of early engagement is to enable new and existing suppliers
to take a proactive approach to tendering. In most cases, if you wait until a contract has been published to introduce your organisation to the buyer, it may be too late.
There are several benefits associated with proactive business development including the ability to plan resources ahead, anticipate potential challenges, give time to understand the market and competitors and give you a competitive edge. The same is true of the early engagement concept which can enable your business to win more work with the private sector.
By opening discussion, potential suppliers can gain an in-depth understanding of what the buyer
is looking for in the tender bid, including the scope and wider issues such as environmental considerations and sustainability. This results in your organisation being in a far better position to write an accurate tender response that ultimately wins.
Stay ahead of your competitors
If your business wants to boost its procurement possibilities, searching for supply chain procurement opportunities is a great place to start.
Find private sector opportunities using our Commercial Projects tool. Tracker customers with Commercial Projects gain complete access to over 400,000 planning contracts and 10,000 non-planning projects every year.
Commercial Projects can be added to any Tracker package. If you’re interested in winning private sector business or simply want to know more about Tracker Intelligence, we’re happy to answer all your questions during a live demo of our business intelligence tool.
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Apr 13, 2020.