Energy Industry Tender Competitiveness is heating up and Tsaks Consulting founder Jason Cooney explains how businesses can improve their bids and proposals to match.
The energy market in Australia is becoming increasingly complex, with renewable energy emerging as a political issue, and the challenge of addressing each state’s individual energy needs becoming increasingly apparent.
The market is heating up with multiple competitive contracts being released in the renewable energy market as well as the traditional energy markets and a number of multinational companies vying for a piece of the pie.
As usual, price is a key factor for securing major contracts and industry contacts and reputation are always helpful. But with all government contracts going out to tender, what about the other key factors? Let’s look at how companies are introducing these into their tender responses in order to write more winning bids, tenders and proposals to secure more government and private contracts.
A track record operating within the Australian regulatory environment
Demonstrating a solid, comprehensive track record in Australia is generally critical to secure a major Australian government contract or operational licence. However, sometimes international companies have a track record of delivering similar projects in the Asia Pacific Region (such as New Zealand). Strategies that can help you overcome this issue include:
- Develop a joint venture with a local Australian-based company or even a company in the state you are tendering for. This should be a company with the right track record for similar projects, but one that may not have the size or capacity to complete the project on their own. It generally provides the opportunity to bid for the project and present your experience and expertise combined with those of the local JV partner to help you secure the tender. One example is Victoria. Victoria has a strong buy local policy and generally a preference for Victorian-based companies. Developing a JV with a Victorian-based company can increase your prospects of success and help you put forward a bid that better conforms to the Victorian buy-local criteria.
- Engage an Australian (or state-based) major sub-contractor. Let’s take the example of a major solar photovoltaic project. You may be committed to take the project on as a whole and should explore engaging a qualified sub-contractor. Throughout the tender preparation period, leverage on the experience of your sub-contractor and include this experience in the bid. Be sure to talk about the systems and processes you have in place to ensure you project manage your own performance and that of the sub-contractor effectively. When you are preparing the tender response, work closely with your proposed sub-contractor (for example a photovoltaic installation provider) to introduce their skills and experience throughout the tender response.
- Talk about the similarities of your previous projects. If your previous projects were based in the Australia-Pacific region, it’s important to talk about the similarities of your previous projects to the project you are bidding for. This shouldn’t be restricted to the technical side of the project, but also the way it was managed. For example, if the project was completed under incentives from the New Zealand Government and you were required to provide progress reports and updates for the appropriate NZ funding requirements, be sure to reference this so that you can demonstrate your track record in completing projects in countries that have a similar regulatory framework to Australia. If the contract terms of the project were governed under international law, it’s also a good idea to reference this in your response.
Whole of life cost of project
Innovation and a long-term approach are key to securing contracts in the energy industry.
Government and the private sector want to be certain they are being provided with a long-term solution that will stand the test of time. It is critical that you educate the reader and the buyer when writing your bid or tender about the whole of life cost of the project including future maintenance costs. For example:
- Does your photovoltaic project use an inverter with an expected life span of 12 rather than 10 years?
- Does your proposed solution require less maintenance over the longer term of say 70 years, but a higher up-front cost?
Where you are proposing a solution that has a lower whole of life cost, but a higher initial cost, it’s important to explain this in detail and incorporate the advantages of a lower whole of life cost throughout the tender. That means having them as a key win theme and incorporating the benefits of your solution across the technical response, program, previous experience sections and executive summary.
This is often best presented graphically or as an infographic. What is critical here is that you don’t shy away from putting forward a higher price, but rather justify the reasons for that higher price and clearly articulate the advantages of your project and solution, particularly over the long-term.
Your proposed team
In order to secure a contract and write a winning bid, tender or proposal, it’s important to convince the reader that you are putting forward your A-team. They want to know that the project will be managed by the very best and the installation and other contractor personnel are experts in their fields.
So what can you do to convince them of this, aside from providing their CV?
Some options are to:
- Include CVs that are detailed and talk about the previous projects the personnel have delivered and the similarities between those projects and the project or contract you are looking to secure.
- In all areas of the response, include quotes from different team members that are personalised and demonstrate their commitment to the project. For example, include safety as part of your response. This can be in the form of a quote from your safety officer identifying the different areas of concern and what safety management system will be implemented as part of the project.
- Provide an orgnisational chart and show where your proposed team fit into the organisational chart. Demonstrate that they are getting your A-team by talking about the team members and where they sit. For example, has one of your best project managers and site managers recently completed a major project, and if so, are they going to be available if you are successful with the bid? Present it as though the timing is right and you have a team that has worked together in the past on a number of successful projects ready to go.
The above are just some of the factors which will be considered and which you need to address in order to secure government energy contracts around Australia.