10 Big Bidding Blunders made by Small Businesses

For SMEs, bidding for contracts can be a crucial growth opportunity but it’s often difficult to get started. It can be a process fraught with potential pitfalls, especially when bidding for your first project or two.

Even the most promising proposals can fail due to common mistakes that may seem minor but carry significant weight when evaluated. Here are ten of the most frequent bidding blunders some SMEs make and how to avoid them:

1. Failure to Understand the Buyer’s Needs

One of the most significant errors SMEs make is not thoroughly understanding the buyer’s requirements. Instead of focusing on what the buyer really needs, companies often emphasise their own capabilities.

A successful bid is buyer-centric and tailored specifically to solve the problem or meet the demand outlined. Highlighting your business’ strengths is only relevant if it’s fulfilling a need set out by the buyer.

Tip: Read the documents carefully and ask questions if any points are unclear. Tailor your bid to address the buyer’s objectives, not just your strengths.

2. Underestimating the Selection Questionnaire

The selection questionnaire, often the first step in the bidding process, can seem like just a formality. However, this is where buyers assess whether the bidder meets their basic criteria. SMEs often make the mistake of treating this step lightly, resulting in incomplete or rushed responses that disqualify them before the actual bidding begins.

Your responses to the bigger questions may be just what the buyer is looking for, but they might never be seen due to an error in your selection questionnaire.

Tip: Treat the selection questionnaire as seriously as the main bid.

3. Inaccurate Pricing

Pricing is a delicate balancing act. Overpricing can make your bid uncompetitive, while underpricing may create doubts about your ability to deliver as well as undermine your own work. Inaccurate or unrealistic pricing can cause your bid to be dismissed immediately.

Tip: Conduct thorough research on costs, including labour, materials and potential contingencies. Ensure your pricing reflects the full scope of the project while remaining competitive.

4. Overly Generic Responses

Buyers often have to mark a great number of bids, including those from experienced bidders, meaning generic responses just won’t cut the mustard. They are looking for responses that speak to their unique challenges and don’t want too much general information about what your business offers.

Tip: Personalise your bid. Reference the buyer's situation and specific needs to demonstrate that your solution is tailored for them.

5. Weak Supporting Evidence

Bidders frequently fail to provide strong supporting evidence, such as case studies or references, which can greatly strengthen their bid. Buyers want proof that you can deliver on what you’re promising and this is where supporting evidence comes in.

For example, a buyer might only ask for a carbon reduction plan but that doesn’t mean you can’t include instances where you have gone above and beyond what is outlined in this plan.

Tip: Include relevant case studies and client testimonials which show your proven track record in delivering similar projects.

6. Poor Presentation or Formatting

No matter how good the content of your bid is, poor presentation can undermine your proposal. Disorganised formatting and grammatical errors can give the impression of carelessness.

Tip: Invest time in the presentation of your bid. Use headings, bullet points and consistent formatting to make your proposal easy to read and professional.

7. Inadequate Risk Management Plan

Contracts often come with inherent risks. Bidders who fail to demonstrate a solid understanding of these risks, may be seen as unprepared. If a buyer is considering your business as their top pick, they need to know that risk management is one of your main priorities.

Tip: Include a comprehensive risk management plan that identifies potential challenges and outlines how you will mitigate them.

8. Ignoring Social Value or Sustainability

Social value and sustainability has never been more important than it is today and this is only going to increase. SMEs sometimes give minimal attention to these areas, which can cause their bids to lose out to competitors who are doing this well.

Tip: Address how your business contributes to social value or sustainability. Whether it’s environmental initiatives or ethical labour practices, showing your commitment to these areas can significantly enhance your bid.

9. Not Asking Questions

Buyers welcome questions about their projects, often creating specific spaces online for suppliers to ask whatever they need to know. Asking questions not only gives clarity in certain areas where you may need it, it also shows the buyer that you are invested in putting together a quality response.

Tip: Ask questions and maintain open lines of communication with the buyer to show you’re invested in the project.

10. Overestimating Resources

Putting together a successful bid is a lot of work and this often requires resources you may not have. Getting a member of your team to put a response together and pulling them away from their main role is likely not the best decision.

Tip: If resources are limited, consider outsourcing to bidding experts, such as Winning Tenders, who can truly make a difference to your success rate.

Avoiding these common bidding blunders can significantly increase the chances of SMEs securing valuable contracts. By being meticulous and presenting a compelling, well-supported bid, SMEs can position themselves as credible and reliable partners capable of delivering on their promises.

If you think you might need some extra help to get your business to where it needs to be, bid-wise, email Winning Tenders at [email protected] or call us on 01392 247997. We are a customer-focussed, award-winning business with a wealth of experience and knowledge. We offer bespoke bid writing, bid management and training solutions for any size of business.