Welcome to the Keystone Column. This week, we look at the options for suppliers that want to “do something” after losing in a tender process. As usual this week’s free weekly list of Irish government tenders is included in out e-Tenders report.
This post from April 2016 is the second in a series of three posts dealing with common scenarios that a losing supplier can find themselves in. In this scenario, we are going to assume:
- the bid was strong but still lost to a competitor; and/or
- the losing supplier was expecting win and did not do so.
Being beaten by apparently small margins
A losing supplier is entitled to receive their scores back from the buying organization. It is a requirement that an explanation of the decision be given to a losing supplier. The decision must have been made on the criteria. As most contests are awarded on MEAT (most economically advantageous tender) price ought not solely determine the outcome.
Relevant experience is often where losing suppliers fall short and this is something they need to strongly consider when bidding. Frequently in well-run and adjudicated contests, the winning bid may not have one perfect citation (right sector, same product / service, similar size & complexity, same kind of timelines, ingenuity & methodology) let alone three. It important to reflect on how close the experience detailed in the bid actually is to the tender specification.
Apart from relevant experience, a losing supplier can struggle with conveying methodologies, explaining how they oversee and manage contracts, manage risks and issues and how they add value during a contract. Details on quality management systems (where they are required) are often answered poorly.
Contracting authorities are not required to meet with a losing supplier. For legal reasons, many buyers do not give reasons beyond a breakdown of scores. This makes honest, post-tender reviews important for a losing supplier (so they can learn and improve).
Having concerns about the outcome
If a losing supplier still has concerns after it has undertaken a post-tender review, it can seek to obtain further explanation from the contracting authority. Again, beyond the scores, many authorities refuse to meet and will offer only relatively basic explanations (e.g. the winning plan was more detailed and reflective of what is required to deliver the project).
In Canada, the Office of the Procurement Ombudsman is charged with reviewing and providing explanations of the decisions made on public contracts. In Ireland, the Office of Government Procurement offers a Tender Advisory Service that can be availed of up to the clarifications cut-off before the tender submissions deadline. Unfortunately, it is not independent of government but its purpose is to try and offer greater transparency during the tender writing and development stage. It has no power to revoke / overturn decisions however so its usefulness is limited. The service is currently under review.
Losing bidders with concerns can present their concerns to buyers in contracting authorities. They can also seek the assistance of independent business advocacy organisations like the Irish Small and Medium Enterprises Association and the Small Firms Association. The final option for companies in Ireland is to seek a judicial review. This is infrequent and its effectiveness as an option is debatable if one takes a long-term view of things such as reputational risk to the supplier.
Options for losing bidders
Most losing bidders do not contest decisions for pragmatic reasons. Many take the view that the potential for upside from contesting the outcome is remote. A judicial review will typically result (if successful) in the contract going back out to tender again, not in it being awarded to the party contesting the outcome.
There are key risk factors that can inform losing bidders decisions as to whether to contest a decision or not like:
- Are there close, long-standing relationships between the buyers and other bidders?;
- Does supplier and/or buyer rotation take place on the account?; or
- Has post-tender negotiation taken place?
These are all risk factors for decision-making and the awarding of a contract (more on these here). Where any of the three factors above present, a review will have a higher chance of overturning the decision. In the vast majority of cases however, bidders lose for conventional and explainable reasons. This said, one in every six cases appealed to the Canadian Ombudsman is turned over. That is a high number in an accountable, transparent and mature procurement system.
In a market like Ireland, there is a strong possibility that a significantly higher amount of awards would be overturned if the structures existed to facilitate this.
New public procurement tenders this week
Visit the Keystone website to view our take on the 500+ active public procurement opportunities with more than five days until their deadline. There are a vast range of services, supplies and construction related to public procurement opportunities in the following sectors (there are many more sectors than the sample list below):
- Construction and related trades,
- Professional & Advisory Services,
- PR, Media, Advertising and related,
- ICT supplies and services,
- Property & facilities management,
- Vehicle & automotive,
- Catering and related services,
- Cleaning and related services,
- Waste Management,
- Maintenance and related services,
- Horticultural supplies & services,
- Research & environmental monitoring,
- Printing, office supplies and related services,
- Medical and scientific research, supplies and services,
- A vast range of other services and supplies.
Businesses interested in any of these strategic procurement opportunities that are unsure of how they can follow-up on these tenders can contact Keystone at any stage. We would be happy to discuss your needs and where they may fit with your business growth plans. These public procurement opportunities are sources of business growth and innovation for companies across the country.
Please note, e-tenders often has public procurement opportunities incorrectly categorised so people relying on e-tender alerts could easily miss out on opportunities if they are dependent on it. E-tenders is only as reliable as the people inputting tenders and mistakes are made very frequently. The Keystone Column includes all live tenders posted on e-tenders that have five or more days until their deadline as at August 10th 2017.