How to negotiate a better tender deal
MANY times contractors fail to get tenders, not that they are incompetent, but because they lack negotiation skills.
By Brenda Asiimwe
MANY times contractors fail to get tenders, not that they are incompetent, but because they lack negotiation skills.
That is why any procuremnt professional must be an astute negotiator. This makes the difference in one’s company success in getting better contracts or services.
Therefore, the procurement function plays a great role in the financial success or failure of companies through cutting-edge negotiations.
The Chartered Institute of Purchasing and Supply defines negotiation as a means of communication with the objective of reaching an agreement through compromise.
This makes negotiation a valuable tool that procurement officers and service providers can use to resolve disputes, improve performance and get value for money on projects.
Colline Mpaata, the Institute of Procurement Professionals of Uganda (IPPU) executive secretary, explains that there is no universal set of rules that govern tender negotiations.
He, however, states that good negotiators must be flexible to walk the thin line between domination and appeasement. He notes that negotiations help strike a deal that would satisfy all the parties.
“Clear definition of the parties interests involved is a key factor to having a better deal. Knowing what either a contractor or job owner wants is vital for any negotiation to be successful,†Mpaata says.
He advises bidders and contract owners to always be specific when setting targets and the project cost to ensure that they (targets) are achievable and verifiable.
According to Dora Egunyu, the procurement authority, PPDA, spokesperson, bidders always get bid documents, which outline the terms and conditions of the work to be done.
She says after reading and evaluating the documents, the bidders can then negotiate within the terms provided for in the bid documents.
“As a bidder, one should assess the terms as stated in the bid documents, internalise them so that they understand the project to see if they have the capacity and competences needed,†Egunyu says.
She notes that it is not good for a contractor to negotiate according to the cost of the project, but the statement of requirements as per price evaluation.
She explains that the contractors are free to negotiate deals within or outside of the price quoted in the bid documents. However, this also depends on the contractors’ capability to deliver on the job.
Mpaata argues that carrying out thorough planning and having the right people on the team before starting the negotiation are the key success factors for a contractor to get a better deal.
“This is true with big multi-national companies. These firms have professional negotiators who ensure that their employers get the best deals and the lowest cost,†Mpaata notes.
He argues that carrying out thorough planning and having the right people on the negotiation team, are the key success factors for a contractor or project owner.
to get a better deal. and strategy of the organisation.
Mpaata argues by saying that carrying out thorough planning and having the right people on the team before starting the negotiation are the key success factors for a contractor to get a better deal.
MANY times contractors fail to get tenders, not that they are incompetent, but because they lack negotiation skills.
That is why any procuremnt professional must be an astute negotiator. This makes the difference in one’s company success in getting better contracts or services.
Therefore, the procurement function plays a great role in the financial success or failure of companies through cutting-edge negotiations.
The Chartered Institute of Purchasing and Supply defines negotiation as a means of communication with the objective of reaching an agreement through compromise.
This makes negotiation a valuable tool that procurement officers and service providers can use to resolve disputes, improve performance and get value for money on projects.
Colline Mpaata, the Institute of Procurement Professionals of Uganda (IPPU) executive secretary, explains that there is no universal set of rules that govern tender negotiations.
He, however, states that good negotiators must be flexible to walk the thin line between domination and appeasement. He notes that negotiations help strike a deal that would satisfy all the parties.
“Clear definition of the parties interests involved is a key factor to having a better deal. Knowing what either a contractor or job owner wants is vital for any negotiation to be successful,†Mpaata says.
He advises bidders and contract owners to always be specific when setting targets and the project cost to ensure that they (targets) are achievable and verifiable.
According to Dora Egunyu, the procurement authority, PPDA, spokesperson, bidders always get bid documents, which outline the terms and conditions of the work to be done.
She says after reading and evaluating the documents, the bidders can then negotiate within the terms provided for in the bid documents.
“As a bidder, one should assess the terms as stated in the bid documents, internalise them so that they understand the project to see if they have the capacity and competences needed,†Egunyu says.
She notes that it is not good for a contractor to negotiate according to the cost of the project, but the statement of requirements as per price evaluation.
She explains that the contractors are free to negotiate deals within or outside of the price quoted in the bid documents. However, this also depends on the contractors’ capability to deliver on the job.
Mpaata argues that carrying out thorough planning and having the right people on the team before starting the negotiation are the key success factors for a contractor to get a better deal.
“This is true with big multi-national companies. These firms have professional negotiators who ensure that their employers get the best deals and the lowest cost,†Mpaata notes.
He argues that carrying out thorough planning and having the right people on the negotiation team, are the key success factors for a contractor or project owner.
to get a better deal. and strategy of the organisation.
Mpaata argues by saying that carrying out thorough planning and having the right people on the team before starting the negotiation are the key success factors for a contractor to get a better deal.