Thursday, 29 May 2014

Tip of the Day - Pricing it Right

I’ve mentioned financial modelling in a previous tip, but this one focuses on how you price your bid competitively.  It is probably the single most important decision you can make on a bid so make sure you spend time on it and do everything possible to get it right for your organisation.

Unfortunately many organisation price simply to win a contract; this is not a recommended approach!  You need to look at what price is right for your organisation as opposed to what will simply win the contract.  There is no point in winning a contract if it will financially cripple you, particularly if you are an SME.


The only reason it may be worth pricing to win is if you can break even and it stops a competitor getting in to an area you want to protect or even potentially a re-tender.  This is still risky as it only takes something small to go wrong and you are losing money.

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