Are you doing enough to retain key incumbent contracts?
Re-bidding for contracts as an incumbent contract provider is a necessary challenge to retain revenue. This paper offers proven strategies to help you retain contracts which are critical to you and secure your business's future. Read on to find out more.
In this article, we will explore key strategies that can enhance your chances of success in retaining incumbent contracts. By implementing these strategies, you will position yourself for success in the re-bidding process and reduce the risk of revenue loss.
Impacts of Losing a Major Contract on Businesses
Losing a major contract can have profound impacts on businesses, reverberating throughout various aspects of their operations. The repercussions extend beyond immediate financial implications, touching upon critical areas that define an organisation’s stability and growth.
The loss of a major contract can send shockwaves through the financial markets, leading to a potential decline in a company’s share price. Investors often perceive contract losses as signals of instability, causing them to reevaluate their investment decisions. Maintaining a solid track record of contract retention is not only a testament to a company’s reliability but can also contribute to sustaining a favourable market valuation.
Senior Leadership Job Security
Contract losses can create an atmosphere of uncertainty at the leadership level. Senior executives may find themselves under increased scrutiny, and their job security could be compromised. The ability to successfully retain major contracts showcases effective leadership and management capabilities, bolstering confidence in the team’s strategic vision.
The loss of a significant contract can lead to operational downsizing, including layoffs and redundancies. When revenue streams are disrupted, companies may be forced to streamline their workforce to align with reduced business activities. Effective contract retentionsafeguard jobs and contributes to maintaining a stable work environment.
Reasons Why Contracts Are Lost
Lack of Innovation
Failing to innovate and adapt to changing client needs can render a company’s services obsolete. Clients seek providers who can offer cutting-edge solutions that address emerging challenges. By continuously innovating, businesses can demonstrate their commitment to staying ahead of the curve and securing long-term partnerships.
Failure to Understand That Goal Posts Have Moved
Industries are dynamic, and client priorities evolve over time. Businesses that fail to recognise these shifts risk losing contracts to competitors who can better align with the new landscape. Adapting to changing market conditions and anticipating clients’ evolving expectations is crucial for contract retention.
Five Strategies to Retain Incumbent Contracts
Early Preparation: Securing the Foundation for Future Success
The journey to retaining incumbent contracts begins from the moment you secure a new contract. It is critical to lay the groundwork for its long-term retention by delivering on the promises made in your initial tender. Regularly reviewing your original tender commitments and prioritising any deprioritised initiatives are key steps. By demonstrating your commitment to fulfilling your proposals, you establish trust and confidence with the client. To solidify your position, revisit and reaffirm your commitments at least 18 months prior to the re-bid, demonstrating your dedication and allowing ample time for necessary interventions.
Engaging with key decision-makers and influencers within the client’s organisation is another critical aspect of early preparation. Understanding their interests, concerns, and priorities enables you to develop a tailored communication strategy. Proactively communicate the positive aspects of your work, such as innovative solutions, accolades, certifications, and improvement initiatives. Building a strong rapport and influencing their perception of your business significantly impact their decision-making process.
Continuous Market Analysis and Competitive Benchmarking
Staying ahead of the competition requires a deep understanding of the market landscape and your competitors’ activities. Regularly conduct market analysis to identify emerging trends, changing client needs, and potential disruptions in your industry. Simultaneously, perform competitive benchmarking to assess your strengths and weaknesses relative to your competitors.
Armed with insightful data and the acumen of seasoned strategists, companies can strengthen their position as incumbent providers, impressing clients with their unrivalled expertise. Demonstrate strong contract performance via a dashboard which is easy for your clients to access. Include social value delivery in this dashboard, as this is now. important requirement for all government contracts.
By leveraging market insights, you can proactively tailor your services and solutions to meet evolving client demands, even before the re-bidding process begins. Uncover gaps in your competitors’ offerings and highlight your unique selling propositions to demonstrate your market leadership and strategic positioning. Use this knowledge to inform your bid strategies, ensuring your proposals are aligned with the latest market trends and innovations, thus differentiating your bid from others.
Rather than solely relying on internal brainstorming sessions, involve your clients in the innovation process. Engage in regular conversations and workshops with key client stakeholders to understand their pain points, future goals, and potential challenges. Actively seek feedback on your current services and discuss potential improvements or new ideas. Collaborative innovation fosters a sense of partnership and shared ownership with your clients, creating a deeper level of trust and loyalty. It also allows you to tailor your bid proposals to precisely address your client’s evolving needs, further enhancing your chances of retaining the contract. By involving clients in the innovation journey, you demonstrate a commitment to their success and position your company as a proactive and adaptive partner, ready to evolve alongside their business.
Avoiding complacency and embracing new ideas is vital for long-term contract retention. Being open to innovative approaches, even if they were previously dismissed, can yield significant advantages during the re-bidding process. Tendering exercises often provide an opportunity for clients to welcome new ideas and solutions. Timing plays a key role as clients may be more receptive to fresh ideas during the procurement cycle. Seize this opportunity to propose innovative approaches as future requirements are being captured and seek to help thecustomer as far as they will allow, to develop the future contract specification.
By incorporating these strategies, you can be a step ahead of your competition and have prepared solutions to contract requirements ready for the re-bidding process.
Cultivating a Diverse Bid Team: Fostering Creativity and Expertise
Well ahead of the rebid timeline, assemble a diverse team that extends beyond the current contract team to consider how you can innovate for the next contract cycle. Including individuals from other contracts, different workstreams, head office departments, external partners, subject matter experts, recent recruits infuses fresh perspectives and fosters innovation. This diversity challenges entrenched thinking, injects creativity, and ensures a well-rounded bid. These team members bring fresh pairs of eyes, unencumbered by past experiences, allowing for creative brainstorming sessions and the generation of unique ideas.
Demonstrating Measurable Value and Continuous Improvement
As an incumbent, you have a unique advantage to showcase your track record and accomplishments during the existing contract period.
Compile data-driven metrics and performance indicators that clearly demonstrate the positive impact of your services on the client’s business. Highlight key achievements, cost savings, efficiency improvements, and other tangible benefits that resulted from your partnership. Presenting these quantifiable results builds a strong case for your ability to deliver on promises and drive real value for the client.
Furthermore, emphasise your commitment to continuous improvement. Outline initiatives you undertook to enhance service quality, address challenges, and adapt to changing circumstances during the current contract. By demonstrating a proactive approach to refining your offerings and processes, you instil confidence in the client that you will remain responsive and future-focused in meeting their evolving needs.
Areas in Which Those Who Retain Are Investing
Fostering strong relationships with existing clients through ongoing engagement and proactive communication is paramount. Account development initiatives, such as personalised support, tailored solutions, and regular progress updates, can solidify client loyalty and increase the likelihood of contract renewal.
Investing in research and development to drive innovation is an important strategy for retaining contracts. By continually enhancing products and services, businesses position themselves as indispensable partners, capable of providing unique value that competitors cannot match.
About Augmentas Group
Fundamentally we do two things, we buy for the government, and we help others to sell to government. We have a strong blend of operational, commercial and sales experience within a team of experienced professionals, all of whom have proven success. We know what we are doing because we have done it many times before, having bought, sold and delivered £billions worth of services for and to government.
We have supported our clients to retain key contracts and offer a comprehensive suite of services tailored to support our clients in contract, in preparation for re-bid and through the bid process. From strategy development to proposal writing, our experienced team has the expertise to help you secure and retain the contracts that are critical to you.
With an excellent track record, we are confident in our approach. See our services.