Any job which involves the procurement of materials, goods or services will, more often than not, involve the process of bid management. In business context, costs and resources are never infinite; hence the bottom line for every business is controlling costs in order to maximize profits. This is where bid management comes in! For some helpful information on the process of bid management, look no further!
There are many suppliers who will be willing to take care of your procurement needs, because it will, in turn, boost their own businesses. If this is the first time you are procuring materials, goods or services for your company, then you need to invite potential suppliers to bid for the contract of supplying the same. Next, you will need to prepare specifications for the bid, which can then be advertised, giving details of how the interested suppliers can apply for the tender and provide their most-competitive bids. A word to the wise here, competitive bids do not necessarily mean the lowest priced ones. There are several factors to be taken into account while considering the competitiveness of a bid.
Prepare a detailed specification/requirement proposal for procurement.
- List in detail, the requirements for procuring the materials, goods or services.
- For preparing the final proposal, you will need to get all the information you need from the company’s procurement policies, inter-departmental requirements and other interested parties.
- Never prepare a bid proposal in a hurry! Similarly ensure that you provide ample time to interested suppliers to evaluate and present their best offer on your bid proposal.
- All suppliers must be supplied with the same material and information, the effectiveness of the bid system is diluted if different suppliers for the same goods and services receive proposals which have different requirements or specifications.
- Let the bidders know the final date for receiving final bids, keep the details of individual bids confidential and ensure each bid that is presented is signed by the authorizing officer of the supplying company.
Evaluate bids received.
- All bids received must be thoroughly reviewed for completeness and compliance with your stated specifications.
- Do a first cut at this stage, by removing bids which are not in line with your requirements or are shoddy or prepared in a hurry, without taking all factors into consideration.
- Once you have a shortlist of worthy bids, review them again to pick the bid which is most competitive. As mentioned earlier, this need not mean the bid with the least price. You should also look for how innovatively the supplier tries to meet your specifications.
- Also important is the pedigree of the selected supplier – time in business, previous successes in supplying materials, goods or services of a similar nature and so on.
- Put the selected bid price into perspective with your business requirements and total costs.
- Above all, keep your bid management process fair, transparent and methodical.
This, in a nutshell, is the entire process of bid management. Armed with these guidelines, you will find your procurement challenges become very easy to overcome.