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Reasons Why Your Business Could Be Losing Tenders

May 28, 2024

As the construction industry becomes more competitive, it is integral that businesses submit accurate tenders. Winning new business helps to secure contracts and build credibility in a competitive landscape. 

There are various challenges businesses may face that could result in losing tenders – which includes inaccurate estimating, high competition in the market, lack of data-driven decision-making, outdated prices and information, and manual processes. 

If your company is in a position where you have submitted bids for contracts but has had little success, it’s time to evaluate your processes. This is where estimating software can be a crucial tool. It helps address these issues while supporting your financial, commercial, and estimating teams. 

Take a look below to learn how to improve your chances of winning a tender submission:  

Inaccurate Estimating of Tenders & Out-of-Date Prices

Manual estimating processes can lead to inaccurate cost estimations being tendered for. These inaccuracies can have unfavourable effects, such as overpricing leading to losing tenders to competitors or under-pricing which could lead to loss in revenue as projects progress, due to the costs involved not being accurately accounted for. 

Manual estimating creates a margin for human error like miscalculations and oversight which hinder the competitiveness and the profitability of a business.  

Another error that can occur is providing tenders to multiple contractors with the lack of standardised pricing and the inability to keep pricing up-to-date due to constant inflation and material cost changes which can cause difficulty in maintaining competitiveness and profitability in the market. 

Implementing estimating software enables businesses to expediate the estimating process by having pricing libraries on files such SMM7, NRM2 and internal libraries, with resource build-ups and annual updates to resource rates to provide up-to-date pricing eradicating manual input, speeding up and improving accuracy of tender creation. 

click here to learn how to win more business with accurate tenders with an estimating solution

High Competition Submitting Tenders

Being undercut on projects by rivals offering lower bids is one of the largest problems facing construction companies. The ability to effectively estimate costs and submit competitive bids is essential for any organisation hoping to succeed in the highly competitive construction industry.

While creating competitive bids for submission, it’s important to maintain standards to deliver high-quality results. As clients look to select cost-effective tenders, they are also looking to partner with contractors that prioritise quality, keep to project timelines and are reliable.  Finding the balance between pricing and quality is key. 

Estimating software can support the generation of precise cost estimations based on project specifications, materials, labour costs, and other relevant factors. Quality estimating software allows estimators to describe, measure and price Bills of Quantities (BOQ) with as little duplication of effort as possible to produce fast, accurate and consistent tenders. Collate and analyse subcontractor enquiries or drawings issued out in one central place. Subcontractors can submit their quantities and rates, as well as perform their own take-off. A powerful subcontractor portal management centre allows you to manage response and ask for revisions. Creating an expedited tendering process which allows for performance and productivity of tender creation to increase. As a result, enabling your business to prepare for competitive bids with confidence, knowing your estimates are accurate. 

Data-driven Decision Making

When deciding which bids to accept, many construction companies rely on gut feeling or insufficient information, which can be problematic. This method frequently produces bids that are inconsistent and erroneous because choices aren’t supported by in-depth research. Businesses risk missing important insights into resource allocation, cost trends, and project schedules if they don’t have the right data. This lack of data-driven decision-making can result in a failure to learn from previous efforts, inefficient use of resources, and recurrent blunders. Adding to that companies that rely too much on intuition may find it difficult to recognise new trends or modify their plans in response to shifting market conditions. This could put them at a disadvantage compared to more analytically minded rivals.  

Estimating software like EValuate empowers companies to transform their bids by increasing accuracy in project estimation and take-off processes Utilising estimating software not only saves time and minimises errors but also positions companies for success in the competitive landscape. By providing precise cost projections, automating calculations revolutionises the way project bids are approached, helping businesses make more strategic and informed bidding decisions. 

Internal Outdated Processes when Tendering

A pain for any business, especially in the construction industry during and after the initial bid process, is operating disjointed software systems, which can hinder accuracy and efficiency when working on projects. When different functions of the tendering process are performed on different platforms, a complex network of data silos is prone to mistakes and delays. 

Limited visibility into expenses and profitability results from estimating software not being connected with accounting or finance systems in construction companies. In commercial divisions, this lack of understanding makes decision-making more difficult. 

Modern estimating software with integration capabilities, provide businesses with ability to revolutionise their construction process from estimation, initial bid, to project completion, site final account. Possessing an estimating software that can integrate with your constructionspecific accounting or finance system offers real-time data and analytics, providing commercial roles visibility into overall profitability, margin, and project costs. Estimating software such as EValuate, speeds up the process of describing, measuring and pricing jobs –including a cloud-based take-off tool, allows estimators to produce detailed bids and to send detailed budget information across to a construction specific-accounting software such as EVision or Construct for Sage Accounts once project is won automatically to create a contract for management thereon. 

How to create tenders efficiently and faster to help you win more jobs

EValuate helps businesses in producing precise and consistent tenders, whilst tracking budgets and costs against projects for both pre- and post-contract. This benefits estimators, quantity surveyors, commercial management, and finance teams by helping to improve productivity which ultimately helps businesses to win more jobs and deliver projects on schedule and within budget. 

Click here to start watching an estimating demo now

Next Step to Tender

To find out more how Eque2’s industry leading construction estimating software could help your business, click here. Alternatively, you can arrange a free online demonstration tailored to your specific requirements by emailing us at construction@eque2.com or phoning us on 01628 702702. 

What to read next: Features you should look for when buying estimating software… 

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