118 The Financial Times Guide to Business Development
12 Swapping people. You may have individuals with particular experience
whom you can put into other organisations in exchange for them
doing the same for you.
13 Trading services. Many businesses will be open to this. If you need a
new website built and designed, perhaps a website design business will
be open to you providing them with goods or services of appropriate
value in exchange.
14 Use of gift certicates or vouchers. Let’s suppose you run a restaurant,
you could create some certicates or promotional offer vouchers,
which you perhaps pass on to other businesses in the area to give
to their customers as a gift or service-related gesture. When the gift
or offer is taken up, an agreed payment is made to the distributing
business.
It is quite clear from the above that joint collaborative ventures can take
many forms and are absolutely appropriate to businesses of all sizes. I am
often asked how you set up and establish such collaborations. The answer
is very simple and always the same . . . you ask. It really is as simple as con-
tacting another party and saying something along the lines of: ‘Hi, my name
is Bob Anderson. I’m one of the owners of the Italian restaurant on the high street
and I’ve got a couple of ideas for joint promotional ventures that could be good
for both of us. Are you up for a speculative chat?’ Rarely will such an invita-
tion be turned down on the spot. Usually you will either meet, have a more
detailed discussion over the phone or be asked to put your ideas in writing.
The absolute bottom line, however, is to make sure that as an integral part
of your business development thinking you make a conscious effort to ask
yourselves the question that I mentioned at the beginning: who can we
collaborate with to mutual benet?
How to win in competitive situations
If you are involved in business development, then there will almost cer-
tainly be times when you have the opportunity to formally compete and
‘pitch’ against other businesses to win a potential contract.
You may have the opportunity to submit a proposal, which will then be
considered alongside those prepared by other, equally optimistic, com-
peting businesses. Sometimes this will be as part of a formal tender process,
where specic businesses have been approached to pitch for work.
7
Priority 3 – Externalise business development efforts 119
This section takes a pragmatic and commonsense look at how to win
competitively from my perspective as someone who has helped many
businesses win millions of pounds worth of work in these sorts of
situations.
As regards formal tenders, before going any further I want to mention
that there are two types of tenders: private and public. Private tenders
are those that are not driven by publicly funded bodies and organisa-
tions. In this book my focus is on private tenders or other more informal
competitive business situations. This is simply because public sector
tendering is very highly regulated by a massive amount of constantly
changing and complex EU public procurement legislation, which is
extremely political and involves constant red tape and hoop jumping.
In terms of winning such a tender it is almost always driven by price-
related factors and unless you are the cheapest your chances of success
are more limited.
Despite these negatives, the fact is that there are a huge number of public
sector opportunities for businesses out there. If you want to check them
out, visit the relevant EU website: www.ted.europa.eu
I have personally been involved in supporting businesses in private sector
tenders on over 100 occasions and have been fortunate to have a high win
rate, resulting in millions of pounds worth of revenue for the businesses I
have helped.
The reason I’m telling you this is simply so that you understand where
the tips and traps below come from. They are not based on any academic
or theoretical principles, but on real experience of observing and par-
ticipating in many actual situations. The truth is, most businesses which
don’t perform well in tenders fall into the same few traps, whereas those
organisations which consistently get good results tend to observe certain
very simple rules. With this in mind here are the questions and issues I will
be addressing:
How do these tender or other competitive opportunities arise?
Shall we go for it?
What are the six golden rules of winning?
What are the major traps?
How should the proposal be set out?
120 The Financial Times Guide to Business Development
How do these tender or other competitive opportunities
arise?
By invitation
Probably a third of the tender situations I am involved in are as a result of
a direct approach by a company literally having pre-selected a business as
a possible supplier and offering it the opportunity to tender. At that stage,
you as a business would be sent what’s usually known as an ITT (invitation
to tender). This document, which can be of any length, will set out the
opportunity and describe the tender process in detail.
Direct approaches
Other tender or competitive situations that frequently arise are as a direct
result of prospecting, relationship building, networking both online and
ofine and by direct approaches to an organisation. Over the years I have
had a lot of success on behalf of businesses making direct approaches,
by asking an organisation when it is next going to be reviewing the
suppliers of certain goods or services.
In one project 22 organisations were approached directly; nine told us that
they were going to be reviewing over the next 18 months and then as a
result of ongoing and structured contact, my client participated in four
formal tenders and won three of them. One of them was worth £1.5 million
in revenue per year! If you are not doing this, you may be missing out.
Existing clients
The other tender situations that arise quite frequently and which seem to
be on the increase are those involving businesses which invite their existing
suppliers to tender to retain their contract. This can be very frustrating for
the incumbent supplier.
Many businesses putting forward such proposals often make the mistake
of drafting the proposal and submitting it exactly as they would if they
didn’t know the client in the rst place. The secret of success in these situa-
tions, however, is in drafting the proposal in such a way that it documents
the gains that the company has had by using you, as well as the ongoing
benets of continuing to use you.
Shall we go for it?
Imagine the scenario. You receive an e-mail or letter out of the blue from
a senior person in an organisation you have been communicating with for
7
Priority 3 – Externalise business development efforts 121
some time. They tell you that they are putting a particular job or project
out to tender and ask whether you would like to express interest in par-
ticipating in the tender process. As a business you now have a decision to
make . . . shall we go for it or not? Here are a few tips to bear in mind:
Experience/expertise
You need to be absolutely scrupulously honest with yourselves over this. If
you do not have the specic expertise or experience to deliver what is being
asked then it is probably sensible to pass on the opportunity.
Resources
It may well be that you do have the experience and expertise but the scale
of the project may be beyond your current resources. If you don’t have
the necessary resources and would not be prepared to take on the risks of
investing in getting them, then again don’t bother to participate.
Is it worth it?
I have seen a huge number of rms automatically tender for everything
that they have the opportunity to go for. Don’t be seduced by every busi-
ness opportunity. You need to take a hard look at not just whether you
could win it, but how protable the contract might be in the future. I
have experience of working with businesses which have been very smug
that they have won tender contracts despite the fact that servicing them is
unprotable.
Don’t make assumptions
Too many businesses assume that they have no chance for various reasons
and then withdraw from the process. This can be a serious error of
judgement.
If you do have the experience and expertise, the resources and you believe
the potential business to be protable, then go for it. Don’t assume that you
are too small, too big, or that other businesses have a much better chance
and then back out on these grounds.
I have worked with organisations that have hesitated, but then gone for
it and despite their initial negative assumptions have got contracts worth
over £1 million.
122 The Financial Times Guide to Business Development
What are the six golden rules of winning?
1 Be bold and nd out more information about what is
required
Never ever submit anything in writing to your prospect until you have
tried to speak to them to get further information. Do this in every situation
unless the ITT document specically forbids you to do so.
There are three possibilities.
Firstly, the invitation to tender will openly offer you the opportunity
to speak to somebody to get more information. If this is the case,
don’t treat the offer as optional, regard it as mandatory and call for
more information.
Secondly, the invitation to tender document may be silent as regards
gathering and providing more information. In this situation again
make contact with the relevant person and ask how best to go about
gathering what you need.
Thirdly, you may nd that contact and the opportunity to ask for
more information is forbidden. In this instance you obviously observe
this and don’t ask.
The purpose of you making contact with the prospect after receiving the
ITT is fairly obvious. Your aim is to be able to engage them in conversation,
where you get valuable nuggets of information that you can use and that
your competitors won’t have, because they haven’t bothered to ask.
So, what should you ask? First of all make sure that you resist all tempta-
tions to turn any conversation into a sales pitch. You need to focus on
asking questions in a conversational style in order to draw out as much
information as possible.
Don’t be afraid of asking commercially sensitive questions, such as: why
are you putting this out to tender?; who have you been using in the past?;
what sort of problems and issues have you faced?; what sort of fee or price
structure would be within your ballpark?; who will make the decisions, and
what criteria will they use in their nal choice?
It is also important that in asking these questions you do so in a way that
makes it easy for the other party to decline to answer, without feeling
uncomfortable. For example: ‘Forgive me if this is a bit too commercially sensi-
tive, but it would be really helpful in checking if there is a good t. Are you able
to share the kind of pricing structure that you have in mind?’
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