The timing of when bids are issued is not random but is influenced by a variety of factors, some of which can be predicted and planned for, while others are either project based or driven by market forces.
The client will develop and follow a procurement plan to manage the scope and timing of when they will issue tenders. That will be based on a combination of their existing supplier contracts for the goods and services they require, and a forecast from their operations management team that details how their current activities will change (by adding new or additional projects or by the completion or closure of others). Fluctuations in their activity will either be addressed by the use of existing supplier contracts or may present the opportunity to tender for new supplier contracts. A consideration will be the cost and time required to conduct a tender exercise, but the client procurement organization will usually claim that this will be more than offset by the savings that can be made.
The client will try to monitor market forces, to be able to optimize as far as possible if there is any advantage to be had from deciding when to tender. They will prefer to tender when they see the chance to secure better (lower) pricing or avoid tendering if possible when they anticipate higher pricing. The following table contains some examples of factors that can affect the decision of when to tender.
| Market forces that lower prices |
Market forces that increase prices |
| Multiple suppliers - over supply |
Fewer suppliers - limited supply |
| Excess capacity - over supply |
Limited capacity - everyone busy |
| Industry downturn - reduced demand |
Industry upturn - increased demand |
| Contract extension - retain scope of work |
Important new technology - premium pricing |
| Contract expansion - volume discounts |
The enterprise is likely to rely on several different methods for building an understanding of what tenders are likely to be issued and when. The first and most obvious is to try to establish and maintain a dialog with the client base and ask them what their plans are. This may be through procurement channels, but more likely through other regular contacts and relationship building activities between the enterprise sales and marketing and the client management, operations and support personnel.
Many enterprises will utilize some form of CRM (Customer Relationship Management) software, e.g. Salesforce, to capture customer based data and will utilize this to help identify and track opportunities, including when important tenders are expected.
Also, by maintaining an overview of their existing contracts and monitoring tenders lost and awarded to competitors, an enterprise can forecast when various contracts may expire or have options periods that may be extended.
Other sources of information that can alert an enterprise to new projects with tender opportunities would include such things as monitoring sources such as newspapers, trade publications, client websites etc. and attending trade shows or conferences where clients may be presenting or discussing information about future plans.
By gathering and managing this market intelligence, the enterprise will be able to predict with increasing certainty where and when tenders may be expected. The more an enterprise knows about when a tender process can be expected, the better they can prepare for it, and develop a plan that will optimize the chances of a successful outcome.