The Australian construction industry has a 20:1 ratio of subcontractors to head contractors, with a single project attracting up to 15 competing bids. While competitive pricing is important, it is not the sole determinant in whether or not you win the work.
Presenting as a reliable, professional partner before you even submit your first bid is crucial. Let’s take a look at why marketing, technology, and procurement policy are all important factors when looking to expand your client portfolio.
Why should you even consider tendering?
If you want your business to grow, attracting larger, higher-paying projects, tendering is your best pathway. In the September 2024 quarter, the $79.3 billion of construction work included a drop in residential building approvals of 14.9%, but a bump in engineering construction of 6.1%. This tells us that the big money isn’t in private residential work, it’s in publicly funded infrastructure and commercial projects, and the majority of these require tender bids.
There is also a labour shortage to consider, with some predictions suggesting a shortage of 300,000 workers by 2027. Head contractors want subcontractors who can guarantee labour capacity, financial stability, and reliable delivery, and you’ll need to exhibit all of these if you want a piece of the $100.6 billion in work yet to be done.
What types of contractors create tenders?
While it’s usually bigger companies and projects that go to tender, a tiered system exists that dictates project scale, risk levels, and compliance stringency.
This is what it looks like:
Tier 1
Projects often valued over $1 billion such as major hospitals and rail networks. These firms make up around 41% of infrastructure construction, and will run extensive financial checks, look for national safety accreditations, and expect proven large-scale delivery history in their submissions.
Tier 2
Mid-sized projects between $50 million and $500 million. More accessible than Tier 1 and a great target for emerging subcontractors. You’ll still need to exhibit strong performance at this level, but securing a few of these primes you well for Tier 1 participation.
Tier 3
Projects under $50 million are perfect for most first-time tenderers. This is your entry point and an opportunity to build your reputation.
Important note: Your goal should always be progression between these tiers. To help ensure these, maintain well-documented track records, accredited compliance systems, and proof of an increasing financial capacity. We do not recommend tendering for projects beyond your current tier capability, as it can waste time and resources while hurting your reputation.
Why is marketing important in tendering?
Marketing is your best way to establish trust and prove reliability before you submit your tender bid. As a result, you should approach marketing as a strategic business tool, crafting your output to differentiate you from the competition and attract high-quality opportunities.
The capability statement is where all of this effort can be summarised in your bid. It should be a concise document that highlights your expertise, core services, and value proposition. It is essentially professional proof that you’re ready for larger, commercial contracts and must include:
- Clearly articulated core competencies
- Proof of expertise via key personnel profiles
- A visual gallery of past projects
- Case studies explaining challenges faced and solutions provided
When putting this information together, view it through the lens of communicating professionalism. We also strongly recommend making it available in print and digital formats.
How can I boost my construction marketing?
There are some simple inbound tactics that you can apply to make your marketing more effective and help your bid in the process. A head contractor, or anyone’s, first interaction with your business will likely be online. As a result, your digital presence needs to be confident and professional.
Here are two non-negotiable areas that need to be on point:
1. Website
Your digital business card. Optimisation for your website is vital, and you should do whatever you can to ensure your site ranks for local SEO. This is a great way to bring estimators directly to your door, so make sure your site showcases recent projects, safety certifications, and client testimonials.
2. Social media
Facebook, Instagram and LinkedIn are easy spots for builders to get a quick snapshot of your business, and a great place for you to position your company as a forward-thinking, reliable partner. Post regularly about project milestones, safety awards, and any relevant industry insights that prove you know your stuff. Make yourself look like an informed partner as opposed to just another service provider. Where possible, post video testimonials and project walkthroughs to help build trust in your capabilities.
3. Social proof
The amount of trust that builders put in other builders and people throughout the industry is immense. This is why reviews carry such weight. The real-life experiences that people have with you, and are willing to share, go a long way in building trust with those you haven’t worked with yet. Where possible, encourage Google (and other) reviews to build up your social proof.
How do I find appropriate tenders?
E1 (EstimateOne) is one of the most widely used platforms for tenders in the commercial construction market. We connect hundreds of head contractors and subcontractors and are the perfect place for first-time tenderers to get the visibility and data necessary to compete for larger projects.
E1 features open tenders that can be filtered by trade, contract value, and location, so you invest your time in tenders that match your services. Our goal is to help optimise your chances of success. All of the tender information is available directly in E1, ensuring it is reliable and current.
It is important to note that E1 is more than just a bidding tool; we consider it to be a relationship management platform as well. You’ll have a business profile that can act as your digital resume. Head contractors are always looking to grow their supply chains, and building your reputation on our platform increases your chances of receiving direct invitations to specialised (and less competitive) tenders.
Why is it important to market compliance credentials?
Marketing your compliance capabilities is as important as marketing everything else, as social and sustainable requirements are crucial for builders. In government tenders, these elements hold heavy weightings in the evaluation process.
For example, the Fair Jobs Code is mandatory for Victorian Government contracts. This Pre-Assessment Certificate is required for all suppliers tendering for contracts valued at $1 million or more to confirm their compliance history with industrial relations and workplace health and safety laws (this certificate is non-negotiable for high-value government work).
The Commonwealth Environmentally Sustainable Procurement Policy is another consideration, as it requires suppliers working on projects over $1 million to meet specific sustainability criteria. This includes measuring and reducing carbon emissions, recycled materials, and climate resilience. Marketing your ESG practices can give you a competitive edge in tenders looking for environmentally responsible partners.
Final marketing and tendering strategy tips
With many years of experience in the tender game, we’ve put together these three quick tips that should be front-of-mind when getting ready to bid and your main takeaways from this article:
- Professionalise your marketing and branding with a strong digital presence
- Embrace digital transformation, as digital tendering is the future
- Aim to grow from reactive bidding to proactive, relationship-based tendering
Tendering is an important strategic move for your business and the best way for small construction firms and subcontractors to sustainably become more profitable. Tendering can be complex, but a planned marketing strategy makes it much easier and far more rewarding.
Alexander
Green
General Manager - Subcontractors
