An adviser to the Forum of Private Business has highlighted ‘tender scam’ websites offering ‘free trials’ and the problem some companies face from taking up their offer.
The Forum’s public procurement adviser, Tim Williams of Millstream Associates Ltd, a procurement specialist and the organisation behind TendersDirect.co.uk, said:
“Public sector procurement is big business and directly accounts for almost 50% of the total market for goods and services in the UK and substantially more than 50% if the downstream supply chain is taken into account.
There is a lot of information available on opportunities to supply the public sector, for example the Official Journal of the European Union (OJEU) publishes virtually all contracts with a value greater than £150,000 and the UK Government introduced its Contracts Finder website earlier this year to fill the information gap on contracts worth less than £150,000, which are the ones probably of most interest to smaller companies.
“Unfortunately, neither the Official Journal or Contracts Finder provide a comprehensive answer as there are many, many more contracts awarded by local authorities, NHS trusts and other public sector bodies that aren’t advertised on either of these services.”
He added: “The expensive answer to this problem is to employ someone to search through all of the individual public sector websites, newspapers and trade journals, looking for relevant opportunities, or more realistically take out a subscription with one of the private sector tender information services.
“If you decide to subscribe to a service the next problem is how to decide which to choose as the costs and the quality of information can vary quite widely. Quite a few of these services offer a free trial, so that for a limited period you get full access to the information they are able to provide and can determine whether they offer your company value for money.
“This seems like a good idea but the sting in the tail is that most of these free trials require you to commit to a full year’s subscription in advance, so even if you decide that the service isn’t for you but don’t cancel within the free trial period you become liable for the full year’s subscription.
“Unfortunately many companies inadvertently fall foul of this trap either because they forget to cancel, cannot prove that they did cancel, or that a new or an ex-employee took out the free trial without authorisation.
“You only have to enter “tender scams” into a search engine to discover a whole host of complaints against firms that offer a free trial, but then tie in unwitting companies who don’t really want the service for an often exorbitant charge.
“Sometimes these complaints arise because the billing system isn’t particularly well designed, but the most frequent complaints are about companies which have adopted a rather unethical business model and rely on confusion and fear in order to maximise their income.
Millstream Associates Ltd’s TendersDirect service does not offer free trials but instead provides a free search of all contracts in its database going back five years.
“The problem for us is that there is quite a lot of work involved in setting up a new customer to ensure that we get their profile right and provide them with relevant information, whether that’s for a year’s subscription, or just for a 4 week free trial.
“The approach we have adopted is that visitors to our website can search the last 5 years of our entire database and can read the full details of any of the older tenders free of charge, but if you want to see the current opportunities you have to subscribe.
“Our reasoning is that it allows a potential customer to assess whether we have information that will be useful to them, as the volume and type of tenders issued over the past few months is a good indicator of what’s likely to be published over the next few months. It’s not an ideal solution, but on balance we think it’s preferable to making companies pay for a service that they don’t really want or need.
Mr Williams said that public contract tendering is not necessarily the correct route for every business.
“That leads me neatly on to the next important factor, which is that while the Prime Minister and the Cabinet Office are vigorously promoting transparency and opportunities for SME’s, it’s a fact that tendering for public contracts isn’t suitable for every business.
“Increasingly public sector procurement staff are adopting a tick box approach to tenders, so that you must have accreditation to demonstrate your compliance with ISO’s 9001, 27001, 14001, CHAS health & safety, equal opportunities, environmental sustainability, etc. These all take time and money to put in place, so while there are significant opportunities to be won, there is also a significant investment to be made, even before you will be invited to tender.
He concluded with advice for potential public tenderers: “In summary, tender information services do provide a useful service, almost certainly much more cost effectively than you can research the same information yourself. But be careful, make sure you read the small print and if you decide not to proceed with the service make sure you cancel any free trial in plenty of time and keep a record of your cancellation.
“Put in the groundwork to make sure you are prepared for all the certificates and qualifications that you will be asked to provide, as it will be too late once the tender documents have been issued. Access to information on tenders isn’t much use unless you can actually win some of that business.”
http://www.thedrum.co.uk/news/2011/09/15/forum-private-business-advisor-warns-against-free-trial-tender-subscription-sites
