Fleet News

Supplier special: How to pick the right winner

A tender is a ‘snapshot in time’ and over time the range of products and services may change which is why it is ‘very dangerous’ to base supplier selection solely on the tender response with price the arbiter.

Ultimately, the process is about selecting a supplier that will help a company achieve its business objectives.

Therefore, it must be a partnership and one that is adaptable to meeting specific challenges. If the relationship is not right then the whole tender process will have been a waste of time and money.

“Targets will only be achieved if the people managing the account have integrity and understand the customer’s business. That understanding cannot be achieved through a tender and a couple of meetings,” says Ross Jackson, managing director of consultancy Fleet Operations.

That’s why it is vital for prequalification meetings to occur and a dialogue to be in place with potential suppliers that enable them to ‘get under the skin’ of the organisation and truly understand its goals.

“Quality organisations stand out from first contact,” says Mark Cubbon, sales director at ING Car Lease.

“In the creation of the shortlist, look for willingness by the supplier to provide real evidence of success and value delivery, as well as offering access and openness into their organisation.”

Alongside cost, companies should be looking at value for money, service levels, innovative ideas and expertise when deciding if a supplier is suitable.

Fiona Hall, commercial director at Arval, says: “Saving money by selecting the right supplier is important, but to be the most effective any savings must be sustainable.”

She said that while it is important to look at price and ensure it’s competitive, organisations should also ensure there is no compromise on quality or value as a result, adding that tenders ought to be designed in a way that brings out information on cost and services to allow the best decision for the company and its fleet to be made.

Hall told Fleet News that the best providers also understand the latest developments in the market as well as being familiar with emerging technology, and only when these factors are taken into account can fleets make the right choices.

Nigel Trotman, head of strategic consulting at Alphabet and a former award-winning fleet manager, believes it is vital to visit the short-listed companies.

He says: “Meet them and talk to the people that your organisation will be interacting with to make sure that you are comfortable that they are the calibre of person that will fit in with your culture.”

Service delivery, development plans and future innovation as well as processes around the account management structure are vital.

It is also important to learn how a potential supplier will manage certain scenarios.

Finally, at the end of final presentations those leading the tender process should know each suppliers’ capabilities, pricing and their ability to be a ‘good fit’.

Using a ‘full balanced score card approach’, appropriately weighted and measuring key criteria, including capability, risk, financial stability, corporate social responsibility issues as well as price, the organisation with the highest score should win the contract.

Hall says: “Companies must use a clear process to ensure consistency in scoring suppliers. This should be structured around specific requirements to ensure selection of the company that can best support the achieving of corporate goals.”

To compile a shortlist of suppliers for tender, click here. to www.fleetnews.co.uk/suppliers/

Top tips to choosing partners

  • Do your research and make sure you have an idea of the market prices
  • Take a wholelife costing approach rather than looking at price alone
  • Consider the whole service package each organisation offers
  • Take recommendations, reviews and customer testimonials into account, but do your research.

Source: Chartered Institute of Purchasing and Supply

 

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