The easy errors costing you government contracts

Hyper-focused on your own strategy? You might be sending your tender application straight to the trash. Photo: JaruekChairak.

In the high stakes world of government procurements, a single missing sentence can cost you big, experts warn.

Suppliers are seeing six-figure bids tossed into the trash heap, not because their product is bad, but because they fail to meet a fiendishly simple requirement.

That is the warning from Australian Strategic Property Advisers (ASPA), a company that has sat on evaluation committees for hundreds of Commonwealth procurements and supported numerous private sector responses.

ASPA managing director Stephen Oxford says one of the most common yet sometimes fatal errors is tunnel vision.

“A classic example is how lease incentives are handled,” he says.

“The Commonwealth often explicitly demands a lease incentive entirely as capital to fund their tenancy fit-out. Respondents might want to hedge their bets and offer a mix of capital and rent-free periods. But because the agency literally cannot afford to fund the fit-out themselves, that bid gets thrown out.

“The tragedy is that when these suppliers get feedback, they’ll say, ‘But we could have done all capital’. That may be true, but it’s not what they wrote.

“Procurements are expensive. They might’ve spent $150,000 on that response and because they missed that one specific sentence, they’re out.”

The “rent-free” trap is just one example that highlights a broader, more systemic issue in B2G (business-to-government) bidding: innovation without compliance.

Requirements for government projects reflect an intricate mix of organisational strategy, financial risk management and operational decisions, Stephen points out.

“When the Commonwealth specifies a particular structure, it is usually the result of months of internal homework and risk profiling. It’s not a case of ‘we didn’t think of doing it another way’, but rather that multiple factors have already been considered and deliberately designed into the procurement,” Stephen says.

For example, a property service provider might pitch an impressive, self-contained maintenance fleet because it’s their biggest strength. But if the Commonwealth’s tender specifically asks for a solution that utilises Indigenous, SME or female-led businesses, then you’ve answered the wrong question.

“Innovation is not always rewarded in this space because you still need to put in a compliant response, even if you have a ‘better’ delivery method,” Stephen says. “That’s not to say innovation is never rewarded. There is a framework for including an alternative offer that explains your approach and why it may be better, but compliance is the foundation.”

ASPA managing director Stephen Oxford says small and medium businesses that can demonstrate deep alignment can hold their own against large corporations in valuable government tender bids. Photo: Michelle Kroll.

Meeting the strict criteria of a tender is only the first hurdle. Stephen notes that while missing a mandatory clause will get a bid thrown out immediately, a much more common disease among failed submissions is a lack of deep alignment.

“Compliance is just the first hurdle,” Stephen explains. “It’s a high bar on its own, but strategic alignment with the requirements is where we see the most deficiencies. It’s incredibly easy to skip a nuance or structure a response that doesn’t demonstrate understanding of the client.”

When dealing with procurements worth tens or hundreds of millions of dollars, the response documents are necessarily complex and dense. Winning respondents don’t just read the request for tender as an isolated document, but deep dive into the agency itself.

“The most successful responses understand the unique nature of the client’s portfolio and the organisational drivers behind the procurement,” Stephen says.

“You have to look at the type of work being done inside those agencies, the stakeholder relationships, the operational locations and the highly specific security requirements of various agencies.

“It’s not a simple process — it needs a careful, structured approach. If you can show that you truly understand how they operate, you move beyond being just another compliant response and become someone they can see as a future strategic partner.”

The good news for SMEs is, in this environment, large budgets don’t always guarantee a winning bid.

“Actually, smaller organisations tend to be more nimble and able to adjust their delivery models or team structures to better align with requirements,” Stephen says.

“Larger organisations have often written hundreds of tender responses before and they fall into the trap of reusing previous submissions. They also often have operating models that are uneconomical to change for a specific requirement.”

For more information contact ASPA.

Source: Region.com.au