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Emotions or rules? What drives tender selection processes in the B2B sector? Can purchases through tenders protect against emotions and help follow the rules when choosing a logistics partner? We find out with Aleksandr Kovalchuk, Tender Management Director at AsstrA-Associated Traffic AG.
Alexander, are tenders common at AsstrA?
More than half of AsstrA’s sales are made through tenders. So successful participation in tenders is a strategic element of the business. Preparation for and participation in tenders is a multi-step process involving employees from the sales, tender management, operations, financial, legal, and IT departments.
In which tenders does AsstrA participate?
First of all, the company focuses on tenders from clients with whom cooperation has already been established. Potential clients’ bids are also taken seriously, as they are a profitable sales channel for building our client base. The transport route is an important factor for choosing a tender in which to bid.
What criteria do clients use to assess tender bidders?
The main criteria are a competitive price and a credible guarantee to fulfill 100% of the necessary obligations. After a preliminary screening by price, there will be a list of finalists whose proposals are considered in detail by the client’s tender committee. The lowest price does not automatically win – experienced cargo owners understand that 2% savings on transport and logistics services is not worth a threat to business stability. Transport failures can lead to higher costs through disrupted supply chains and the necessity to keep higher stock levels. Therefore, a positive reputation and a good track record with the client are clear advantages.
How can a company win more tenders?
It is necessary to set the right priorities: analyze and study the client’s documentation, conditions, requirements, and criteria for evaluating proposals. This way you meet as many of their needs as possible.
Process automation also helps. At AsstrA, computer programs perform complex calculations while people concentrate on finding creative solutions. For example, before calculating a bid amount, the distance between the loading to unloading points are calculated. This simplifies the work of operational staff and helps avoid mistakes.
AsstrA has developed a tool that automatically calculates 90% accurate logistics budgets for projects with both new and existing clients. A corporate IT system that compares transportation routes is under testing. Seasonality and quantities are taken into account in order to “build” round-trips with minimum empty mileage. This optimizes rolling stock operations, helps us offer customers competitive rates, and is better for the environment.
To conclude: emotions or rules? What dominates?
Participation in a tender requires strict adherence to its established rules. And clients’ final decisions are based on many factors – some of which are subjective. AsstrA strives to be clients’ best choice based on both rules and emotions. Because satisfaction with our high-quality services is a positive emotion, after all!