We all complain about HIGH COMPETITION in public sector tenders.
Numbers tell a different story. The competition is in fact very LOW.
But things are changing - very fast.
Currently, 41% of tenders receive only 1 proposal.
69% of tenders receive 3 proposals or less.
18% of tenders are canceled. Out of them, 6-13% due to insufficient bids, the rest for other or unspecified reasons (based on Hermix data for selected analyzed markets).
Between 2011 and 2021, the share of contracts receiving only one bid rose from 23.5% to 41.8%, and the average number of bidders fell from 5.7 to 3.2 (according to the European Court of Auditors). The median EU country has single bids for 28% of tenders (EC Scoreboard 2024).
The reality is that the public sector space is NOT crowded.
There are very few or no proposals submitted. There are a LOT of tenders canceled. A lot of these cancelation are caused by insufficient bids.
But things are going to change. Fast.
The new generation of AI tools allow companies to write and submit better, cheaper proposals.
Soon, companies will submit several times more tenders. Each tender will have hundreds or thousands or pages. Very well written, solid, verified, checked. Companies are usually not forbidden from using AI. And even if they would be forbidden, there are ways to go around such interdictions.
Yes, they still need great technical proposal writers, architects, experts, bid managers. Without a great team, AI is not able to write a winning proposal. But with AI, humans can work so much faster, and better.
At the same time, most evaluators are not allowed to use AI, or have strong limits on AI use. Some are internal interdictions, some are public - e.g. for Eureka, or for Horizon grants (the research programme of the European Union).
This creates a huge disadvantage for public authorities and funding bodies. They use 30-year old tools and processes, to evaluate 100 times more, better proposals.
Authorities and funding bodies will need to adapt fast.
The evaluation criteria and tools will change sharply.
We live incredible, exciting times.
We have no idea what the world will look like, even in 1 year from now.