Global tenders – Are Benefits & Worth the Risks !?
Are you considering responding to global tenders? This is an opportunity not only for large corporations but for small and medium size businesses wanting to expand into new markets. Companies, governments and aid agencies issuing global tenders are not looking for one supplier to service the world but for new suppliers for regional or country-specific markets.
Many websites and international journals advertise global tenders for goods and services and new development projects. Most go through a pre-qualification process with you so that you can be an approved bidder. Most important is to select carefully the most relevant tenders and assess your chances of success. The budget level of the tendering organization, your capacity to service the client in the timeframe and your technical ability are all decisions that need to be made so your time is not wasted.
Pricing
Pricing may not be the main criteria in the selection of a supplier. Quality and experience can count to a far greater level especially in cases where emergency supplies are required and where the buyer is looking for a long term relationship and continuity of supply.
Risk management
There are risks involved in global tenders but they can be mitigated provided you are fully informed of the implications and you have done the necessary market research. Some of these are:
- Qualify the buying organization. Find out as much as possible about them, their financial status, reputation in the market, trading and business history, any published achievements. Watch out for the red flags.
- Good quality tenders will provide clear specifications, due date for submission, due dates for delivery of the goods or services. Contact details of the people handling the bid including telephone number and email addresses should be given. If any of these are not clear or missing, beware.
- Legal and contract requirements may vary widely geographically and tenderers should take both their own advice and engage local legal support within the particular country or region.
- Potential fraud is a risk, especially in emerging markets. This can be deliberate and designed but can also be through inadequate internal controls and lack of separation of duties in the buying organization.
- Currency and finance risk. There are fluctuations in foreign currency exchange rates on a daily basis and forward cover or other defensive strategies should be used to protect the overall cost of the product or service and transportation.
Tenders are issued by country, by area, by region rather than for the whole world. Investigate the region you are interested in expanding into and select the global tenders that you are truly able to fulfill.
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