Selling to Government

 

What government policies or legislation have an impact on purchasing decisions?

A major focus of government is South Australia's Strategic Plan (SASP). In line with the SASP, government business decisions should consider the need to achieve the identified targets. Underpinning that focus, individual public authorities have their own strategic objectives, which also align to the overall SASP.

The State Procurement Board is responsible for developing policies, principles and guidelines relating to the procurement operations of public authorities. The Board’s policies are available here.

Legislative requirements of the Government, including the Treasurer's Instructions and Premier and Cabinet Circulars, must also be considered.

Some of the key impacts on the purchasing decision relates to sourcing and trade obligations and key legislative requirements including (but not limited to):

 

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Can a public authority buy from a sole supplier without going to tender?

Public authorities have an overarching objective to achieve value for money whilst meeting their needs – but this can often be achieved without a competitive market approach. The appropriate market approach is a procurement strategy decision (commensurate with the complexity and value of the subject procurement) and considers the business case and the supply market and conditions.

Whilst the various SPB documents provide reference to market approach options in many places, there is no document that details when to approach the market openly or when to use selective tendering. Irrespective of the market approach selected, the rationale needs to be detailed clearly within the planning process documentation.

There are many instances (particularly for procurements of lower value) where the cost to conduct an open procurement process and the effort involved are not going to provide a better result. A limited tender or direct negotiation are appropriate in some situations. The reasons for a limited tender process or direct negotiation with a sole supplier may include:

  • where the pressures of time are such that an open call is not feasible, such as where there has been an unanticipated Government policy decision
  • where recent competitive processes have provided an option for additional purchases and/or indicate that an alternate result would be extremely unlikely if a further competitive process were to be undertaken
  • where a small, stable and well documented supply market exists and the agency can ensure that all potential suppliers are invited to participate
  • where there may be significant public risk if the procurement is delayed by process requirements, such as emergency situations threatening life and property
  • where the goods or services can be supplied only by a particular supplier and no reasonable alternative or substitute exists (eg for works of art, protection of patents, copyrights, or proprietary information), or due to absence of competition for technical reasons

There are strict requirements for undertaking a process of "Limited Tendering" such as above in accord with the Australia-United States Free Trade Agreement and the Australia Chile Free Trade Agreement.

 

How do I obtain advance notice of Government requirements?

The SA Tenders and Contracts website provides details of current tendering opportunities.

The website also identifies contracts that have been entered into by public authorities valued at > $500,000 or more, and consultancies valued at >$25,000 providing some level of insight into "who has purchased what". The Disclosure of Government Contracts Policy (PC027) identifies the specific requirements for contract disclosure.

Some public authorities also provide information on their websites (particularly in relation to panel contracts) but these websites need to be researched individually.

Click here to view the SA Tenders and Contracts website.

 

How do you find out about opportunities to apply for South Australian contracts and tenders?

The South Australian Government advertises contract/tender information on the SA Tenders and Contracts website. SA Tenders and Contracts provides electronic access to all publicly available government tender opportunities.

The SA Tenders and Contracts website has a useful search engine, which enables users to register (providing key words, category or agency search capabilities) contact details so as to enable automatic receipt of relevant tender information by email on the day of the tender’s release.

At the conclusion of a tender process, under the Disclosure of Government Contracts Policy (PC027), summary details of contracts awarded are made available on the website. This can be a useful source of information on government purchasing.

 

What are across government contracts?

Strategic across government contracts are a form of standing offer developed by either Shared Services SA or an individual portfolio in its role as a lead agency. The objective of strategic across government contracts is to:

  • achieve strategic outcomes for the public sector through procurement activity
  • aggregation of demand across agencies
  • reducing duplication both on public authorities and suppliers
  • centralise contract development
  • provide a common management framework

Centralising these processes delivers savings to public authorities by reducing transaction costs and reducing the risks associated with repetitive or common purchasing.

 

On what basis are tenders, quotes and offers evaluated?

As an overarching statement – tenders, quotes and offers are evaluated against the criteria sought in a tender document (Expression of Interest; Request for Proposal; Request for Tender etc). Underpinning this is the determination of the South Australian Government to obtain the best value for money as one of the three key objectives of procurement. The State Procurement Board requires purchases to be made from the most economical source of supply, taking into account quality, service, delivery and price.

Value for money purchasing decisions will be based on various elements such as:

  • whole-of-life costs
    Whole-of-life costs take into account all aspects of cost over time, including capital, maintenance, management, disposal and operating costs.
  • compliance evaluations
    Compliance evaluation requires that the non-financial factors of each bid have been assessed against the specification and compared to other bids.
  • the quality and reliability of supply
    Performance and quality are critical and frequently more important considerations than purchase price. Unless goods/services meet the performance and quality requirements they are of no use.
 

Who buys what in government?

The Government of South Australia operates in many diverse markets with different needs. All public authorities undertake procurements that are necessary for their business requirements.

Shared Services SA (Strategic Contracts - Department of the Premier and Cabinet) has responsibility for establishing and implementing across government contracts on behalf of the State Procurement Board. The main objectives are delivering savings to public authorities by reducing transaction costs and reducing risks associated with repetitive or common purchasing. The Board’s website lists all across government contracts.

The SA Tenders and Contract website displays a list of contracts awarded by the Government of South Australia (in accordance with the SA Government Disclosure of Government Contracts Policy (PC027)).

 

What does 'value for money' mean?

Value for money is one of the three primary objectives of procurement under the State Procurement Act.

The State Government is responsible for achieving the best possible outcome in both financial and non-financial terms in a timely and efficient manner, commensurate with the nature of the purchase.

Best value for money is achieved by applying cost-effective purchasing approaches to deliver the best overall result for money spent – not merely the selection of the lowest price.

Assessment of value for money includes the initial cost of purchase, fitness for purpose, service, support, warranty, operating costs, anticipated maintenance and repair and disposal or removal of the product at the end of its useful life.

 

How do I get listed on an across government contract?

New across government contracts are listed on the SA Tenders and Contracts website.

Panel contracts that have been established vary in the individual methods of providing opportunities for new suppliers to be considered – conditions which are generally established at the initial establishment of a contract.

Across government contracts are detailed on the State Procurement Board website. Should you have an interest in a particular contract, please contact the government contact listed for further information.

Click here to view State Procurement Board Contracts.
Click here to view the SA Tenders and Contracts website.

 

Are there any standard clauses that I can expect to see in all contracts?

The State Procurement Board has developed standard tender and contract documentation, which will enable suppliers dealing with government to see the same set of conditions – no matter which agency you are dealing with.

This documentation can be found on the State Procurement Board’s website.

 

What level of information is sought in government tenders?

Other than across government or lead agency contracts, each public authority releases its own invitations to bid.

All invitations have different response requirements, and sufficient information is required to enable evaluation of the most capable and best value response to meet a business objective.

It is important that you follow the instructions in the bid rules and templates in your response. In the absence of any response templates or specific instructions, you should present the information in a simple structured format. Further information can be found in the Suppliers Guide to Winning Government Business.

Click here to view Suppliers Guide to Winning Government Business.

Information generally sought includes:

  • financial and corporate capability of the supplier
  • past performance (references)
  • technical expertise of the supplier
  • ability to perform the task required or supply the goods required
  • ability to meet the specifications and requirements
  • quality testing (where applicable)
  • source of product supply (place of manufacture)
  • pricing (which can include product, service, shipping and discounts etc)
  • any special conditions
  • compliance with contract clauses and contractual key performance indicators

On occasions, none of the tenders may be deemed acceptable, in which case that tender process may be closed and a further procurement process undertaken.

 

How long do tender processes generally take?

Whilst a lot of work is undertaken prior to a tender being released to the public, a tender will generally remain open for a month to elicit high quality responses: there are specific requirements under the Government Procurement Chapter of the Australia United States Free Trade Agreement [Chapter 15] and the Australia Chile Free Trade Agreements relating to tender call periods. In some instances however, there may be shorter tender periods. In all cases, the tender close date must be advised in the tender advertisement/notification, and in the tender documentation.

As a guide, unless indicated otherwise in the tender documentation, upon the tender closing most evaluation and approval processes take up to two months to contract award. However, this may vary significantly in some procurement projects (often dependent on the complexity, scope and number of responses).

 

Why is it so important to present my tender by the due date?

Under the State Procurement Board's "Late Tenders Policy", late tenders can only be considered when it can be clearly demonstrated that exceptional circumstances have arisen and that accepting the late tender will not compromise the integrity and competitiveness of the process. Every tender release is required to have a tender close date , which is advertised at the commencement of the process.

Click here to view Supplier Selection Guideline.

 

Can I ask for a debrief after an unsuccessful tender bid?

An unsuccessful tenderer may request a formal debriefing meeting to discuss the reasons why their bid was unsuccessful.

The experience of not winning a tender should not be seen as a failure. Debriefing sessions between the supplier and key government contacts are a useful source of information to help potential suppliers submit more competitive bids in the future.

To enable you to be prepared for the debriefing, it can be of assistance to review your tender again against the scope and the evaluation criteria stated in the tender documentation. Debriefing will be straightforward and outline the strengths and weaknesses of your submission. No comparisons will be made with any other submission received and commercial confidentiality will be assured.

Debriefs can be an opportunity for suppliers to provide feedback to government on the tender process.

Click here to view Suppliers Guide to Winning Government Business.

 

What do I do if I have a complaint regarding a tender – is there a formal supplier complaint process?

Suppliers who have a complaint regarding the tender process should raise concerns as early as possible with the contact officer nominated in the tender, in accordance with any dispute resolution processes outlined in the tender documentation.

The State Procurement Board “Supplier Complaints Policy" details the manner in which a complaint should be managed.

As a supplier you have a number of rights, including the right to equal opportunity, fair and professional evaluation of your bids, along with timely communication from public authorities.

Suppliers should endeavour to resolve any concerns with the public authority managing the procurement before lodging a complaint with the State Procurement Board.

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