Up your bid game now, before it’s too late
Win rates are down, competition is high, and most bids are lost to rival businesses that have made better submissions. No business can afford to let this situation continue, says JPC’s David Gray.
The fact that businesses on average rely on winning bids to generate a third of their revenue underlines the importance of getting submissions right. Yet less than half of bids (44%) are now won, according to the RFP Response Trends and Benchmark report 2023, down 9% on the previous year, indicating that success rates are falling, with only 7% of businesses achieving a win rate of over 80%.
Some industries depend on generating a much higher proportion of their revenue from request for proposals (RFPs), such as Advertising, Media and Telecom (46%), and Manufacturing, Supply Chain, Construction and Retail (40%). This makes bid success even more critical.
The problem is that the bid climate has arguably never been more challenging. First, there’s growing competition, with RFPs over-saturated with responses, reducing the chances of winning. There are also more decision makers involved, each with competing and ever-evolving needs, making it tougher, increasingly complex and more time consuming to get the right message to the right person at the right time. Plus, the growth in automated procurement processes makes it harder to build meaningful dialogue with the RFP team.
The current uncertain economic environment, where margins are shrinking, also increases the cost of bidding. What’s more, the process takes up valuable resources, with on average 11 people involved in each submission, a figure that rises with business size. Plus, the more time spent preparing a bid, the greater the chance of success, making reducing resources counterproductive.
Losing a bid might not be so bad if businesses were missing out because their product wasn’t suitable, or the price was too high, as more care in selecting appropriate RFPs and delivering more competitive rates could help solve the problem. However, competitors or incumbent suppliers winning a bid simply because they delivered a better proposal or got there first, was the top reason for RFP failure in the RFP Response Benchmarks and Trends Report 2023.
Essentially, to drive success going forward, businesses need to win more bids. This also secures incumbent status with more customers, providing a head start when the next RFP comes round, whether it’s for the same piece of work on not. This makes investing less in the bid process simply not an option, although it is possible to do this smarter, by looking for the right partner to help improve submissions and increase success.
Getting a partner on board is indeed an added expense, but it frees up internal resources to focus on running the business, while also adding key experience and skills, from writing to presentation. The latter is frequently neglected when submitting bids, yet it can play a vital role in making a proposal stand out.
The perfect bid partner will work closely with a bid team, adding invaluable experience and finesse that will ensure the submission is infused with appropriate ‘win themes’ throughout, reinforcing where the bidder will add critical value. They should also help research the key decision makers who will be assessing each bid, so the proposal can be better crafted and more personalised to their needs, as well as, of course, ensuring it stands out, while not straying from the guidelines.
The right partner should also recommend kicking off the bid process well before the RFP is issued, so that it can be shaped or influenced by the bidder through early recognition of requirements and engagement in advance. Of course, like when buying any service, it pays to thoroughly check credentials in terms of win rate track record and satisfied clients. But choose the right partner and the return on the investment through successful bids should far outweigh the outlay – and provide an invaluable edge over the competition.
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