To bid or not to bid: an important question

“They get bids for everything and always take the lowest bid.” More

To continue reading this article, please do one of the following.

To bid or not to bid: an important question

Posted 11/18/13

“They get bids for everything and always take the lowest bid.”

“They send out an RFP and I can never speak to the decision-maker.”

“We’re becoming a commodity. All they do is take the lowest bid.”

“It’s the government. They have to take the lowest bid.”

Many companies have become smart buyers, but many have become too smart. They’ve refined the buying process so far that they have precluded the words “quality” and “value” from the buying process AND they have taken the words productivity, ease of use and morale out of the delivery process.

The typical request for proposal (RFP) has a bunch of standards about what has to be offered by the vendor, but far too little (or nothing) about what happens after the company takes ownership. They have the “specs” in the RFP, but not the details of use, value, productivity or morale.

The major flaw with the RFP process is that the people conducting the bidding are not the people who use the product or service once the bidding is complete. Nor, for the most part, do they care.

The main goal of bidding is NOT to get the best product. The main goal of bidding is get the cheapest price. And oftentimes that precludes the best product. It also lowers the profit of the company doing the bidding. Long-term, this is not good for the survival of a company.

REALITY: “The customer took the lowest bid” is as bogus as “the dog ate my homework.” The fact is you let the customer control the selling/buying process. Not good.

REALITY: If you follow the customer’s RFP requirements you will lose even if you win. If you win, it’s likely you did at a severe reduction of price and loss of profit. Not good.

That’s the bad news. Let me give you the good news, and the sales news.

There are several strategies you can employ to get around the bidding process, or legally and ethically change the bidding process. Here are some ideas you can begin to use immediately:

1. Ask for a clause to be put into the RFP that states all claims must be backed up with customer testimonial videos as proof. Any procurement department should be happy to add this clause into their bidding process. It will assure them that everything being claimed will come to pass. This will also help in establishing the reality of installation, ease-of-use and long-term serviceability.

Next Page
PBN Hosted

Join PBN for the best networking event and party of the winter - January 15, 2015 - the Book of Lists Party at the Providence Public Library. Reserve your spot early!
  • Best Places to Work
    Enrollment is now open for the 7th annual Best Places to Work program. Winners w ...
  • Manufacturing Awards
    Applications are now being accepted for the 2nd Annual Manufacturing Awards. Dea ...
Purchase Data
Book of Lists
Book of Lists cover
PBN's annual Book of Lists has been an essential resource for the local business community for almost 30 years. The Book of Lists features a wealth of company rankings from a variety of fields and industries, including banking, health care, real estate, law, hospitality, education, not-for-profits, technology and many more.
Data icons
Data can be purchased as single lists, in either Excel or PDF format; the entire database of the published book, in Excel format; or a printed copy of the Book of Lists.
  • Purchase an e-File of a single list
  • Purchase an e-File of the entire Book of Lists database
  • Purchase a printed copy of the Book of Lists
    Latest News