e-Tendering digitizes the traditional process of soliciting bids from suppliers. Through online platforms, companies can efficiently float tenders, receive bids, and manage procurement. Benefits include broader supplier reach, faster bid processing, heightened efficiency, and cost reduction. Despite some digital challenges, e-Tendering's accessibility levels the field for suppliers and streamlines procurement, benefiting both parties.
What is e-Tendering?
When a company needs contractors to fill a gap in their service offering or provide products and services, they’ll send out an invitation to bid to relevant suppliers to compete to win the contracts — commonly known as“floating a tender”.
A team of bid writers then draft proposals on behalf of the supplier and compete with rival service providers to win the contracts. This complete process is known as tendering.
e-Tendering is the same process – only digitised. Software allows companies with active tenders to see all their proposals and even compare them seamlessly in one place, while letting bid writers and contractors scout and submit bids more efficiently in the same platform.
How does the electronic tendering process work?
While traditionally, contractors and bid writers submitted their bids on paper and posted them, electronic tendering is conducted online.
Instead of floating tenders publicly through traditional advertising and marketing channels, businesses upload their tenders to a digital procurement platform.When the tender is live, suppliers can use the same platform to submit bids digitally and track their progress.
What are the benefits of e-Tenders?
e-Tenders offer many potential benefits over traditional tendering, as they’re specifically designed to streamline the process for all involved.
Some of the main benefits of e-Tenders include:
Access to a wider talent pool
Because suppliers are able to view and access business tenders quickly and from anywhere – as opposed to only local contractors applying through traditional paper documents – digital platforms widen the application process to businesses further afield. This means businesses are more likely to access the best candidate, not just the nearest.
Quicker contractor processing
Procurement platforms let businesses view, compare and sort hundreds of contractor bids seamlessly – making it easier, clearer and much more efficient than sifting through reams of paper bids.
As well as being more efficient for the businesses to sort through bids, it’s easier for contractors to create them.Having a seamless digital template that allows contractors to bid on tenders quickly not only opens the door for contractors to access more work, but reduces the time and effort spent doing so.
Decreased procurement overheads
It takes much time and energy to organise and review bids — time that’s taken away from critical day-to-day operations. Because efficient procurement platforms slice the time it takes to manage bids and procure talent, that time can be better spent on business growth.
e-Tendering eliminates business concerns regarding loss of documents and information, with digital platforms providing seamless and instant delivery of documents. Plus, they offer useful features such as real-time bid status tracking and instant feedback and communication between businesses and contractors — so nobody has to worry.
What are the disadvantages of e-Tenders?
Despite having many advantages for both businesses floating tenders and contractors bidding for them, a transition to digital e-Tenders can come with some potential complications.
Some of the risks to consider with e-Tenders include:
Should any downtime occur on the network or digital platform itself, it could mean bid information becomes temporarily unavailable. In a world of tight deadlines and quick turnarounds, facing delays in procuring contractors can seriously hurt the reputability and bottom line of a business.
Depending on the platform, navigating the submission portals can require additional training compared with traditional, established tendering processes. Although this is not necessarily a long-term challenge, for some, it can potentially be intimidating and confusing — meaning some applicants could be deterred from applying altogether.It’s important businesses choose a platform with effortless access and an intuitive interface to avoid alienating potential suppliers.
In some cases, e-Tendering may come with additional expenses compared with a traditional tendering process. However, this is typically offset by the time and effort saved operating digitally –allowing the procurement team to focus on more valuable tasks elsewhere.Additionally, by widening the talent pool, businesses can often access more cost-effective suppliers, too.
DeepStream’s digital RFX platform alleviates challenges in the e-Tendering process, offering an intuitive portal that makes it easy for procurement teams and suppliers alike to submit and manage documents – with a comprehensive audit trail and an integrated communication platform.
What are some e-Tendering examples?
While e-Tendering is used by many private companies, it’s predominantly used in the public sector.
Governments typically float tenders to contractors for construction work to maintain public buildings or to fix roads — while universities typically do the same thing for on-site renovations.
Many businesses also float tenders to suppliers. Retail stores and supermarkets use e-Tendering to secure the best quality products or materials to distribute at the lowest possible cost.
Which technologies are used in electronic tendering?
The only technology needed to perform successful e-Tendering is an e-procurement platform with integrated RFx and auction functionality.
This allows for the entire e-Tendering process to be fulfilled on a single platform, from businesses uploading a tender and offering an invitation to bid, to online auctions taking place and identifying the most attractive supplier.
However, Deepstream’s e-procurement software goes above and beyond, with intuitive auction functionality and an evaluation structure that helps businesses find the best matches with a supplier scorecard.
How much does the electronic tendering process cost?
When businesses tender through a digital platform, the only associated costs are those for thee-procurement software.
However, these costs are often offset through savings on the production and distribution of traditional paper tendering materials. Plus, the time and effort saved on managing a paper-based bid invite process frees up the procurement team to focus on high-value tasks.
Why is e-Tendering important?
e-Tendering plays an important role in the source-to-contract process in two key ways — driving down costs and levelling the playing field for suppliers.
With an easy-to-use e-Tendering platform, prospective suppliers can bid for a tender quickly and easily – giving smaller, lesser-known businesses the chance to compete where they otherwise wouldn’t have the time or resources to bid against larger rivals.
This widens the talent pool and increases the chances of a business finding a contractor or supplier that best fits their operating model for the right cost. Ultimately, it is mutually beneficial for procurement professionals and suppliers alike.
Frequently Asked Questions (FAQs)
What is an e-Tendering system?
An e-Tendering system is simply a platform that facilitates businesses looking for contractors and suppliers and makes it easier for those people to bid on that business’ tenders.
Where this process was traditionally conducted using long-form paper-based applications, more and more sectors are moving to seamless digital procurement systems to speed up the process.
What are the benefits of e-Tendering compared with traditional tendering?
The reason e-Tendering has become the preferred method to connect with potential contractors and suppliers is because it is much more efficient than traditional tendering.
Some of the other advantages of e-Tendering over traditional tendering include:
· Ultimately more cost-effective after initial overheads are covered.
· Access to a wider supplier talent pool.
· Contractors and suppliers can bid for more tenders quickly and easily.
· Replaces troublesome paper trails with a comprehensive audit trail.
· Allows businesses and contractors to find the best matches quickly, reducing project delays.
Interested in an e-procurement solution that propels your future projects in the right direction? Request a demo of DeepStream’s e-procurement solution and get started today!