Winning NHS Contracts - An Accountants Perspective

Arun Mehra, a specialist dental accountant has recently written about the NHS tendering process - I thought it was a useful guide to the steps involved and with his permission have copied the article below:

As part of their drive for transparency and fairness, most NHS Dental contracts are now tendered by PCT's. However, winning an NHS tender is no easy job. In fact, it takes time, research and a lot of persistence to win an NHS contract. The process can be tedious, costly and also fruitless if you don't win the tender. Therefore, the decision to tender must be well thought through before even commencing.

We have outlined below the key steps that need to be addressed to win a tender.

1. Evaluation of the tender available

2. Submission of the PQQ - Pre Qualification Questionnaire

3. Submission of the ITT - Invitation to Tender

4. Final Interview and Presentation

1. Evaluation of the Tender

Perhaps this is the most important of all stages, to evaluate the tender that is available. All too often I see some dentists get excited about entering in to a tender, without much thought given to the consequences of preparing, submitting and then delivering on the NHS tender. The figures sometimes look very big, but all too often the responsibilities that go along with the big numbers are even bigger, so one must firstly consider can you deliver on the contract. Some questions you should ask at this stage include:

Do I understand the commitment of this tender?

Is it realistic to be able to set up and deliver based on the PCT's timetable?

Have I, or my team sufficient experience in delivering such NHS tenders?

Do we have to find suitable premises for the NHS contract, or are the premises provided? Quite often, you will be required to find premises and apply for planning permission for such premises in a very short period of time

Who will be working at the practice, will it be the contract holder (you) or other performers? If it is other performers, have you factored their costs into your initial consideration?

The initial consideration of the outlined tender is essential if you are going to have a good change of making a successful bid. Make sure you do your homework before committing.

2. Submission of the PQQ

If after your initial consideration you feel this is a tender worth going for, the first step is the submission of the PQQ, the pre-qualification questionnaire. This usually involves the submission of a few page document with qualifying criteria questionnaire. The purpose of this stage is for the PCT to evaluate if you are a viable candidate for tendering for the contract. The level of detail required here depends on PCT to PCT, some have quite simple questionnaires, whilst others are much more complex. Information they require in the PQQ include:

Organisation Details

Workforce Information

Financial Standing

Relevant Experience

Health and Safety

Equal Opportunities etc...

The PCT will review the answers provided by the bidding organisation and then after they have scored it, they will then decide whether to shortlist the organisation for the Invitation to Tender. It is essential to answer all of the questions and if you have any questions raise them early. The answers you give must relate to the PCT's key drivers behind commissioning for dental services in the first place. It will also be essential to demonstrate consideration for patient care, satisfaction, efficiency and value for money.

3. Submission of the ITT

If successful at the PQQ stage you will then be invited to tender. Much of the requirement here builds upon the PQQ, so your responses will need to be full and considered. You will need to demonstrate in full your methodologies and policies in place at your practice and how they meet the PCT's objectives. As part of the ITT stage you will need to consider the price of the tender, i.e. what price per UDA or UOA are you bidding for?

In this economic climate this will need to be evaluated very carefully, get this wrong and you could either out price yourself, or even worse commit to a contract that will not be profitable for you. No doubt PCT's will say that price is only one of the things they are looking for, which I am sure it is, but in my opinion in this economic climate PCT's will be looking for those bids that offer the best value for money. This may not always mean the cheapest price, but in cash strapped PCT world, it may well prove to be.

As part of evaluating your bid price you will need to take into account your costs of set up, plus the costs of operating the proposed practice. This means you will need to have a good understanding of the costs involved in running and managing an NHS dental practice. In addition, if you are hiring performers (associates to do the work) this cost will need to be factored into your cost too. Once you have then identified all costs, you will then need to consider what profit margin do you expect for the investment you make.

Once you have defined the profit you are looking for, you will then come up with a price for the whole tender, and ultimately price per UDA or UOA.

We recommend seeking professional help from an experienced Dental Accountant, like Samera, at this stage, to ensure your bid price factors all elements of the business. All the effort of describing many of the clinical and patient care aspects of the tender can be lost if you do not get a price that works for you and the PCT.

In addition, at Samera we have a detailed UDA/UOA Bid Price Model available for dentists who require help in getting their price right. Just get in touch with us so we can help you get the right price.

Finally, the tender document will need to be professional looking and you will be required by the PCT to submit the document in the format they require. So make the tender document look professional (no coffee marks please!) and make sure it gets to the PCT on time. Late submissions are rarely admitted.

4. Final Interview

If after this whole process of submitting the PQQ and the ITT you are successful you will then be invited to meet with the PCT to present your tender. If you reach this stage you will have reached one of the final few and are in with a very good chance of winning the contract.

You will be usually expected to present on key issues surrounding your tender document including how you derived the price. Quite often the panel of interviewers can be numerous and include some non-dental personnel, so it will be essential to speak in lay mans terms.

This stage is an opportunity to sell yourself and expand on your bid, so preparation is essential. If you are using powerpoint, use it well, if in doubt, get someone to help you set it up for you. In addition, if you feel you need a professional, such as a clinical person or say your accountant to come along with you to help your case then take them along, however, since you are bidding for the contract you should be the main presenter.

After your presentation, then the panel may have some questions for you, again make sure you are ready with your answers. Being prepared is an essential part of the final interview stage.

5. Contract Award

If after this complete process, which can take either weeks or months, you have been successful, the PCT will inform you and the next stage of delivery must occur. You will then be expected to deliver on your initial project plan as outlined in your ITT. Then the real work begins, making sure the NHS contract you have won, work for you.

I would really welcome comments on readers experiences of tendering for contracts, you can give your feedback and experience here at the
Samera Connect site

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