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"How Does Our Company Successfully Bid For Commercial Contracts Through The "Request For Proposal" (RFP) Process?"

*** DISCLAIMER*** These are helpful hints that may help in the commercial bidding and proposals and that PWNA has no responsibility in the success or lack of success of individuals and/or their companies.

This is a question often asked as contractors go after larger accounts and expand their businesses. Trying to land these accounts can be both intimidating and time consuming. To make the process easier we have developed this question and answer format to hopefully help answer many frequently asked questions (FAQ's). Q. When dealing with large companies there are so many levels of management and many individuals, how can I make sure I am submitting a proposal to the right person(s)? A. RFP's will have the contact person(s) name and where to submit your bid listed. If you are trying to initiate a proposal to a company you should specifically ask for a decision maker. This may include a Facilities Manager, General Manager, Director of Operations, or any other possible title. Very often a person will do a lot of work and prepare a very nice proposal and it fall into the wrong hands. If a bid is submitted to a General Manager, who is not the decision maker, it may never see the Area or Facilities Manager who may be able to make this decision. So specifically ask, "Can you tell me who makes the decisions for curb appeal and building maintenance?" Q. I received an RFP that was very wordy and 30 pages long. I do not understand everything but I would like to get the job. Should I just bid it anyway? My company could use this contract! A. No, you should understand the entire RFP before considering bidding. An RFP will outline specifically how the company wants the service provided and how it is to be accomplished. Often these documents will have been reviewed by an attorney prior to being sent to the public. It is a good idea to have your questions answered and reviewed by your attorney. You want to be sure that before you sign a contract that you understand all that is required of you. There are some issues that both parties may compromise on during the bidding process. Q. Why should I bid the RFP? They are only looking for the cheapest price, and there is always a competitor willing to work cheaper. My company does not operate like that. A. Not all companies are looking for the lowest price. Many are looking for the most competent bidder in the lower price range. First, determine what a competitor may be offering compared to you. Are you including more service than they are?

This is where understanding of budgets and the budget process helps. An RFP is based on an existing budget that determines what the company is willing to pay. This does not always mean that is what they want. Ask for a budget number so that you can break down your costs and what services you can provide for that budgeted number. Make sure you know exactly what they want included. This may be a time to offer another service that a competitor may not provide. Do not be discouraged if you do not get a budget figure. Many times this is an education process for both parties and if your proposal is accepted it may take a few years to get the actual pricing right. Q. If budget numbers are already decided then aren't I basically deciding whether or not I want to provide my service for that price? A. If you are not part of the budget process then the answer may be yes. Often times if your service was not budgeted for then you may have to change direction. This may be the time to talk to a "decision maker" to educate them about your company and your services. Let them know that you would like to work for them and that you hope in the future that your service could be included in their budget. You have now planted the seed for that company. If the company has provided this in the budget and is currently looking for your service then you may have to decide what your company's costs are and whether you can meet the requirements of the RFP and perform the work for a profit. Many companies begin the budgeting process in the third quarter of the previous year and figures are finalized in the fourth quarter. This is important to know when participating in the process. Working with a company early in the process will help you both land the job as well as help you get the right price. If you wait until it is too late and the budgets are complete then you are usually left with the decision of whether or not to do the work for the pre-determined price. Q. I have received the RFP and I have no idea how to price the job. Where do I start? A. This is the question most often asked. It is important to first understand the RFP and what is required. Once this is determined you must then figure out what it will cost your company to provide this service. It is important at this point not to worry about competitors. You are in business to make money and you must first determine if your company can provide the requested service for a profit. Once you have determined your cost you can add to this figure the percentage of profit that you would like to net. Add these two figures together and you will have your number to bid. This is the number you decide that you are submitting and this may be the end of the process for you. If this is a completive bid process then you may be able to negotiate further. If you would like to continue in the negotiating process insert in the proposal, "This is a completive bid." This will allow you an opportunity at a later date to possibly win the bid. An example would be that you provided a bid based on 30% profit but after following up you could win the bid based on 25%profit you have given yourself the opportunity to make this decision. Q. I do not understand why my proposals are not accepted. I submit a very sharp looking and professional bid and rarely do I hear back from anyone. What am I doing wrong? A. It is a good practice to submit a bid and then continue to follow up on the process. When you perform a follow up a call ask if there are any questions regarding your bid or if there is anything else that may be needed of your company. Very often this becomes a great opportunity to land the bid. For one thing it shows that your company "wants" the job. Secondly it shows that you are professional by the fact that you followed up with a call. This says to the prospective customer that you will follow up on your service as well. This also may be the time to address any other "gray" areas of the proposal. Suppose you are bidding on a retail store for flatwork cleaning of curbs and walkways. If you did not include other services in the initial bid this is the opportunity to possibly sway the decision in your favor. You can inform them that you also provide building cleaning services, cart washing and cleaning, window cleaning, or any other service that they may need. You will increase your success rate dramatically by performing a follow up call. If you are informed that you did not get the bid do not be afraid to ask why. This is an opportunity to find out more about what another company is looking for or what you may need to improve on for the next proposal you submit. You will learn a lot by simply asking why your bid was accepted or why another bid was accepted. Q. What should I include with the submission of the RFP to help my company win the bid? A. You should provide a company profile to let the prospective client know a little more about your company. This should inform them that they can be confident that your company will provide the services requested beyond any shadow of a doubt. You should include any insurance or licensing information. Upon acceptance of a bid you will need to provide a "Certificate of Insurance" with the company's name listed. You should provide any information on certifications, awards, association affiliations, etc. with the proposal. Include any testimonials and references as these are "attention getters". Some companies will choose to include the clause "references provided upon request" instead. Many companies will also provide something "extra" with the proposal to make their company stand out from others. This may include a logo pen, magnet, mouse pad, etc. that really only send the message that we do a little more than the competition. Q. The bid only requires a one time service, is there a way to entice the customer to continue to use my service? A. It is important to always look to build your business. One way is to 'up-sell' other services and another is to provide continued service or maintenance at a lower cost. For example, if the requested bid is for a one time cleaning you simply provide that information and then make an addendum to your submitted proposal. You could possibly offer quarterly, monthly, or weekly service at a different cost level. The more often you provide the service the easier it may be to complete (and in less time). All of this can weigh into a decision to show the customer that they may be able to spend less money than they thought to maintain a better situation for their customers. Q. What should a submitted proposal look like? Won't it just get thrown away if we do not win the bid? A. It is wise to provide a nice presentation in a nice booklet or folder style casing. If it is submitted in such a form it may go on a shelf or be filed. This is a good thing. You want to lessen the odds that the bid will be thrown away. You never know when you lose any bid if the company that won the bid will not perform well. If this happens you want to hope that they saved your proposal. If the company re-bids annually they may remember you because of your last professional submission and contact you again. In other words, never assume that "the tree will never bear fruit." It is common for a company to receive a phone from a proposal submitted 2 and 3 years later. Q. I have put a lot of time and expense into the getting my bid accepted. How soon can I expect to get paid after completion? A. Working in the commercial services arena will require some patience in regards to payments. If there is to be a pay schedule that should be included in the body of the bid. Often these companies will take between 30 and 90 days to pay out. One way to speed up this process is to submit all company information to the Accounts Payable Department of the company that you will be providing service for as soon as possible upon receiving acceptance. This will allow them to enter your company information into their system prior to completion of the work, therefore speeding up the time for you to receive payment. Q. We were awarded a contract but we are often asked to provide "extra" services at certain locations. This is causing us delays and money for these items. How can I resolve this issue without causing a problem or losing the contract? A. Anytime you are asked to provide any service that is outside of the original contract you should complete a written "change order." A "change order" should include any service that is different from the original proposal. It should include information about providing different services at different locations. These exact services and locations should be listed. The change order should have at least 2 appropriate signatures, one from the company providing the work and one from the company to which services are being provided. Make sure that the person or persons signing the change order have the authority to do so. Make sure that the document is dated by the each signer as well. Q. We have been having issues with one account where we are constantly required to re-visit the location to address customer satisfaction. We also have been questioned as to whether we even were at a location and provided service. Is there a way to correct this situation? A. Your company should document all necessary information for each location that service is provided. Most companies will include the technicians or employees assigned to that job and other information that might include date, weather conditions, problems, comments, follow-up recommendations and so forth. If there is a manager on site it is a good idea to request their signature and leave a copy of a report as necessary. If no one is on site at the time of service it is more important to document all activities and issues. In these instances digital pictures with date stamps have become a useful tool, specifically where a before/after picture documents the services performed. *** DISCLAIMER*** These are helpful hints that may help in the commercial bidding and proposals and that PWNA has no responsibility in the success or lack of success of individuals and/or their companies.

Power Washers of North America
P.O. Box 668
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