Construction companies engaging in business with public-sector contractors, such as local and state authorities, federal government offices etc. are inescapably confronted by tenders. Tenders are issued to strictly control the procedures for placing contracts. The public sector is a major market participant, with the EU spending roughly 1.5 billion Euros on the purchase of goods and services - approximately 15% of the gross domestic product.
All tenders for public sector construction contracts in Germany are advertised in the Federal Tender Journal. You can subscribe to get online access at an annual fee of about € 300 on www.bundesausschreibungsblatt.de . The tender portal, “Vergabe 24”, monitors all tenders EU-wide as well as providing a selective information service. Awareness of tenders appropriate to your business is a must. There are a number of rules to be observed if you want to join in the fray for scooping this business and avoid wasting valuable time:
- Formalities: a large number of offers submitted against tenders fail due to non-compliance with formalities; exceeding deadlines, non-provision of performance records and unanswered required fields. Do, therefore, carefully read the formal pre-conditions associated with public-sector tenders.
- Keeping in touch: The better you know your potential purchaser, the better you will be able to draw up and submit your offer. Make sure you get to know who are the decision makers before tenders are issued – this approach will give you a better insight than when just submitting offers anonymously.
- Core business: Only submit offers against tenders that are in line with your core business. This is where you are on home ground and able to best assess competitors and prices.
- Price: the price is, of course, decisive. Your offer should not be too high but also not too low. Attempt to analyse the prices in old tenders. Price agreements with competitors are attractive but illegal. Not only that, but the EU market has become far too murky for such manoeuvres.
Not only suppliers but the public contractors too don’t always stick to the rules. For instance, contracts are not tendered EU-wide but issued free-hand or placed with companies previously selected. Such unfair business practises are not something you simply have to put up with. In certain cases you can apply to the public procurement board to have the matter reviewed.