Across Europe, the number of single bid tenders that only receive one bid continues to grow. Despite the pandemic, the number of contracts awarded after just one bid has been received is staying stubbornly high at 20%.
This means that one in five bids doesn't accrue enough interest to create any competition.
We call these zombie tenders and it is worth putting them into context.
→ Zombie tenders are linked to higher prices.
→ Zombie tenders are linked to shorter bid response times.
→ Zombie tenders are linked to high value contracts.
→ Zombie tenders are linked to complex tenders.
We also know that initiatives like Digital Marketplace can impact a whole market, increasing the average number of bids across a category. Whilst spend controls, putting high value contracts through a pre-competition review, can change how buyers approach their market.
In other words, there are plenty of actions that buyers can take to make tenders more competitive, including using simple contracts, increasing lotting options and splitting up tenders.
It's up to us if we want to challenge these practices and make our markets more open and competitive.
Some Key Statistics
The number of contracts awarded by European governments has increased steadily, but the growth in single bid tenders is outpacing that growth.
The number of contracts has increased by 49% between FY2017/18 and FY2020/21. The number of single bid tenders has increased by 51% over the same period.
The UK remains above average, with 22% of zombie tenders.
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