Between 2022/2023 the government allocated around £393 billion towards public sector procurement across the United Kingdom. In the coming years, this amount is set to increase by 5% and then again by 3% by 2026.
Public sector procurement spending forms an integral part of the central government departments forward-looking budget and planning. More than this, for the Ministry of Defence (MOD), activity surrounding MOD defence contract procurement and defence contract management is vital to domestic defence and strategic planning.
Businesses in defence and related industries can leverage new defence supply chain and procurement opportunities. However, to be successful, businesses need a proper understanding of the defence and security challenges and how to put together a winning defence procurement contract proposal.
Understanding Defence Contract Requirements
Winning lucrative defence contracts requires having a defence contract strategy that will allow your business to identify suitable defence contracts and analyse the contract specifications properly. Control over these procedures will bring you closer to setting up successful defence contract proposals and help you write winning bids.
How to identify suitable defence contracts
Knowing which contract is most suitable for your business can be challenging, but here are some things you can consider when bidding for defence and security contracts:
Contract requirements
Conduct a thorough analysis of the contract requirements, which may include the product or service rendered by the bidder, the time frame in which these will need to be delivered, financial considerations, and supply chain management requirements.
Contract obligations
It’s necessary to consider what your role will be throughout the contract. While you may only be considered a contractor or supplier, you will still play a vital role throughout the defence industry and the long-term success of the MOD.
Contact scope
Next, what is the contract or buyer trying to achieve with this tender? Are they looking to resolve a specific problem or are they seeking a highly specific solutuion in the defence and security markets? What questions are they trying to answer, and how can your business fulfil their needs?
Contract turnaround
What will the duration of the contract period be? In some instances, defence contract opportunities can have a turnaround period of several years, allowing bidders enough time to complete all contract requirements. Make sure to apply for those contracts that fall within your desired time frame.
Business objectives
Consider your business objectives and how an available contract will allow your business to achieve its long-term goals without having to compromise on certain aspects. By ensuring that the desired contract aligns with your forward-looking achievements, you can seek out more relevant contr
Analysing contract specifications and terms
Another important step in defence contract procurement is to carefully analyse each aspect and the contract terms to ensure that you and the buyer are on the same page.
Contract specifications
This will outline specific requirements that you will need to fulfil throughout the contract. These may include things such as delivering an agreed amount of devices or completing a certain service within a given time frame.
Contract terms
Make sure to give enough time to read and analyse contract terms, as this will typically outline your role and the capacity to which you will be required to complete this contract. In some instances, you may be restricted to working on one government contract per cycle, limiting the possibility of contracts overlapping with one another.
Contract clauses
Understanding clauses can be overwhelming, seeing as they can be defined as smaller agreements and arranged within a contract. In these instances, it’s important to break down contract clauses into smaller and more manageable parts. You can review these individually, but consider how they will work interchangeably.
Understanding compliance requirements and regulations.
Part of the process is to review current compliance requirements and industry regulations that may be a subject of interest to your business.
Compliance requirements
Compliance forms a big part of any contract, and without reviewing contract compliance requirements you may find additional pitfalls along the way. Make sure that you have reviewed the compliance brief to find whether you are aligned with the dedicated requirements of the buyer and the specific industry under which you are doing business.
Regulations
Regulatory requirements can be daunting, and working with the government and defence sector will bring forth a host of various regulations that you will need to understand and follow. Be sure to consult with an expert at DCI for more information and guidance regarding single source contract regulations and the defence reform act.
Building a Strong Bid Team For Defence Procurement
Your success will depend on your team, and how well they can manage the various moving parts of the process.
Assembling a skilled and experienced bid team
Bring together the right set of people in your company who can properly understand each facet of the business and contract simultaneously. Your team will need to consist of individuals that can actively identify problems long before the time, and help provide more relevant solutions.
Defining roles and responsibilities
Make sure to assign each team member a given role and responsibility. Having more structure across the team board will ensure that everyone is on pace with providing a more unified solution, and each person will understand what will be required of them to achieve this.
Effective communication and collaboration
Whatever your capacity, keep in mind the importance of having effective communication with your team and buyers. By promoting clear and direct communication, you can be assured of having a more effective collaborative approach.
Developing a Compelling Proposal
Putting all of your expertise and experience into a proposal can be the winning ingredient that helps you obtain lucrative defence equipment contracts and more advanced tender and contract opportunities with government agencies.
Crafting a persuasive executive summary
Your executive summary needs to include your capabilities and how you will provide value towards the project. More than this, what will your approach be and how will you demonstrate effective problem-solving?
Demonstrating technical capabilities and expertise
Highlight things that will make you stand out against competitors. You can include things such as your qualifications, your experience and other expertise that may be valuable to the success of the contract.
Addressing pricing and commercial terms effectively
When laying a blueprint for a defence contract, include how you will be providing a cost-effective solution. Buyers tend to look for the Most Economically Advantageous Tender (MEAT), which includes service providers that can provide both quality and value for money.
Complying with proposal formatting and submission guidelines
Not every defence contract proposal will have the same format, and in some instances, you will be required to follow designated submission guidelines. Fortunately, DCI has years of experience in this arena and can assist your business throughout the process.
Tips for Increasing Bid Win Rates
Here are some things we think can help you improve your win rates following a contract submission or completion:
Building strong relationships with defence clients
Continue to foster relationships with defence clients, including previous and forward-looking clients. Share valuable insights and effectively communicate how your company can provide a high-quality solution at a more reasonable cost.
Understanding the evaluation criteria
Not every contract will have the same evaluation criteria. Get comfortable with the various forms of evaluation criteria you will be required to understand.
Leveraging past performance and case studies
It might be worthwhile to include any relevant procurement experience or past contracts in your bid writing. You can highlight the problem and how you achieved success or what type of solution you provided.
Continuous improvement of bidding processes
Seek ways to improve your expertise, either by collaborating with a bigger business to help win more lucrative contracts or by having a more compelling defence contract management team. Every person in the process plays an important and valuable role and you need to ensure that you can provide a high-quality solution regardless of your capacity.
Conclusion
Defence contract bidding can help put you up for success, however you must follow key steps to help you apply more effective bidding strategies. By leveraging the expertise of DCI you can potentially improve your chances of winning more lucrative defence contracts and develop a defence contract procurement management style that provides you with better long-term success.
