What is the definition of Tendering?

The tendering process is simply a request for an organisation to submit a bid for a specific project or service. Historically it was principally the domain of Government organisations, however today it is becoming increasingly common for entities to prepare a tender for work. A tender usually contains several parts and contain a series of commercial terms and conditions that on initial inspection often appear daunting. Consequently many smaller organisations elect not to consider these business opportunities.

However this does not need to be the case, Illume has the expertise to demystify the tender process and has the experience to assist in preparing a targeted and professional response.

Benefits of undertaking the option

Participating in and responding to tender requests, provides an opportunity to expand your customer base and generate some recurring revenue streams. Once you become a preferred supplier or the incumbent provider, you have a decided competitive advantage over those seeking to gain future access to the works.

In addition, participating in a tendering process can have the added benefit of allowing you to aggregate your services with other service providers to submit a consolidated bid. This process often allows smaller entities to participate in a larger parcel of works which previously would have been outside of their capability.

It is a useful way to share risk in a large project.

Contract / Project Modelling

Critical to ensuring a financially successful project are:

  1. understanding the project revenues and costs;
  2. communicating expectations to your organisation; and
  3. monitoring the project through its milestones.

Knowing the status of your project at each milestone enables timely decisions to improve project performance.

At Illume we can build a project model which accurately defines the project, its revenue and costs, additionally allowing for changes in global indices such as exchange rates and commodity prices. Illume’s models include a summary which clearly communicates the project status throughout the project and assists the decision making process through scenarios analysis.

This Summary Page provides a snapshot of a project. The model supporting this summary page manages changes in global indices such as Currency, Consumer Price Indices, Commodity Prices and Labour escalations and provides a high level snapshot of the key project milestones.

Our Approach

Critical to the success of any tender response is the ability to plan and cost the project. At Illume we will review your costing model, or if you do not have one, we can work with you to develop one.

We will discuss with you the project risks and simulate these through the cost model. Too often we see only the positive assumptions modelled. By using this methodology, on paper, projects never fail however in reality all projects have their risks.

It is also often the case that multiple risks can occur at the same time, which can compound their impact on the project. Our modelling will allow multiple risks to be assessed concurrently to understand their combined impact on the project.

Unfortunately a poor cost model and a lack of consideration or understanding of the project risks are the two main sources of project failure and can lead to an unfavourable result or a Commercial Dispute.

Our Experience

At Illume we have spent in excess of a decade writing and assessing commercial tenders and their responses. We have worked in the infrastructure and mining related industries and are well positioned to assist your organisation to respond to tenders.

Our expertise in modelling and business analysis enables us to assist you in preparing and submitting a comprehensive tender response.