Becoming A Supplier

There are a number of different routes by which companies can begin to supply to the public sector. It's important to define these so that potential suppliers can have a realistic understanding of how to secure their first public sector client, or how to build on their current client base.

Rather than go through each category in minute detail, I will simply highlight a number of important points that need to be emphasised for companies considering to enter the marketplace.

Is it possible to become a supplier without going through the tender process?

Yes. The size of an organisation will determine its view of what is a high or low level purchase, and therefore what needs to be put out to tender. A large council might consider anything below £50,000 to be low level, and accordingly unnecessary to tender. Purchases below the tendering level will therefore be determined by making a Request for Quote from perhaps 3 or 4 organisations.

If I don't pursue tenders how will government organisations find out about my company?

By marketing your company to them. In order to do that you will need to know who and what to target. This is why it is important to use comprehensive and accurate databases to increase awareness of your company's services to its potential clients. Without effectively raising your company's profile you run the risk of being ignored in favour of others that have done the work you have neglected.

If I don't advertise directly to the public sector can I still sell to it?

Taking into account the previous question and its response, the answer is yes, but those sales will be substantially less than they would be if the public sector was targeted directly. Procurement officials do ring up local companies and ask for quotes, and they do use the internet to buy online. However one has to be realistic. There is a limit as to how much a company can sell if it is not recognised as a regular port of call for purchases.

What's the difference between low-medium level tenders and high level tenders?

The value of the tenders are less and the actual process is much simpler. There's a tremendous amount of work available at this level. It should be noted that the number of high level tenders an organisation may advertise will be tremendously less than the number of one-off purchases, Requests for Quotes, and low to medium level tenders.

Are high level tenders only won by large companies?

No, an enormous number of tenders are won by SMEs (small to medium enterprises). Of course, very large corporations regularly secure very large contracts, but in many cases it's not competitive for a big organisation to pursue what it views as small orders. Also, the tendering process is anonymous, so if a company offers a better quality service than a well known rival it can win the contract based solely on the bid it puts forward. In short, by ignoring the tender process your company may be missing out on large volumes of business.

Is tendering incredibly complicated?

No, it's just a structured sales process.

How do I educate myself on the tendering process?

We provide Tender Guidance to all clients that require it, and we have a number of templates that clients can use to quickly meet the needs of public sector purchasers. Once the central points are understood - and company and service information have been prepared - tendering can be be readily assimilated into your company's standard sales process.

If my company was only interested in business below £75,000 could I secure public sector orders without tendering?

Yes. Approximately 15-20% of contracts are below the high tendering level, and the number appears to be increasing because of the benefits of electronic procurement. We would recommend that any company looking to work extensively in the public sector become familiar with the tendering process, however a significant number of suppliers do happily without it.

Are there restrictions on young companies or small companies?

The general rule is, companies should only bid for work they have the financial capacity to fulfil. With the exception of high value contracts (and this does not apply to every high level contract) public sector organisations are willing to accept alternatives to the supply of 3 years' accounts, so long as the bidding company can demonstrate its financial health. For more information on the subject please see our 'Tender Guidance' document. Small companies – and micro-companies – have quite a significant footprint in the public sector. There's no inherent prejudice against them; the same principle applies as has already been mentioned – they need to have the ability to fulfil the contracts for which they are bidding. Contrary to the received view held in some quarters, most government organisations have set policies for increasing the number of small companies among their suppliers (see the 'Small Business Friendly Concordat' issued by the ODPM [now the Department for Communities and Local Government] if you would like to know more. Copies are available on request).

One can summarise these points in the statement, that if a company can offer a good quality product or service, it has the opportunity to sell into the public sector. There are a number of ways an organisation can win clients in the government marketplace, and the right ones need to be chosen by the potential supplier. There is no need to follow one route alone; one can pursue several avenues in order to generate business from the public sector, and the limitations on what can be achieved are generally practical and determined by the ambitions of the competing company.

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