On Persuasion and "Win-Win" Arrangements

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When I started off in sales after spending about three years at site, the one advice people would give me was “ you have to be persuasive”..with the wisdom of a Zen-master .Accordingly, I thought to myself 'gotta be persuasive dude' and "Aal-eez-Well", but there was a spanner in the works,as usual. 

"What’s 'being persuasive'? How do you be persuasive?" were some questions which baffled dumb 'ol me.When I asked, the Zen-masters just smiled a-sort-of-Zen-master smile and uterred wisdom like “ find it out for yourself” or similar words to that effect. The advice-givers are never generous with definitions, as you may be aware. 

However, then I found out when once a person has made up his mind, it is difficult to get him to change his mind. I  was mainly getting my results with my personality, my ability to make friends, my lack of ego at my job hours ( but man I had an ego a mile long after office -I had to do a lot of struggling to realize ..or correction make my CPU realize that the world does not revolve around me-but that's another story).Finally, I decided that persuasion is what precedes aggresion, but I was not happy.

By then there were young people under me and I told them the same thing, crossing one more generation, without any definitions-of course. I had made up my mind by then that persuading is gentle aggression. I was not completely sure but then, no other definitions came to mind. About 10 days back, I came upon this definition in a book in the British Library here, which in my opinion, is superb and exactly conveys what ‘being persuasive’ can mean in sales. I thought therefore I‘d share it, for a change, being in a good mood.

This definition  gives you four approaches all based on the ‘win-lose’ sales concept of situations, which are as under

     1.Unimpressive approach: lose-lose

    2.  Timid approach: You win-I lose.

     3 .     Aggressive approach: You lose –I win

     4.   Persuasive approach: You win-I win

 This impressed the hell out of me, cos it makes perfect sense.Hope you think it is helpful.

 Now, I thought like crazy but could not recall the author. So, if he or she is reading this, thank you for a concept so brilliantly explained.Superb clarity of words and thought. Now I know what to tell my subordinates next time anyone asks me how to be  persuasive.!!

Wishing you lots of profitable selling

Best Regards from

Bilbo.

On Selling Capital Equipment and the Spinach Syndrome

 

Many Sales Managers and or Directors, have this strange idea that the potential clients a sales-person visits, the better. In Industrial Marketing, which comprises of high or medium value systems selling, “cold-calling prospects” is definitely not a good idea. 

Now folks, let me tell you a story. You know how your Maa used to say ‘don’t do that-it invites the evil eye”. and… if you asked why? The answer was invariably “.. That-does-not-concern-you" or “because –I-said-so”? My mother said that my gran had said 'spinach should not be eaten at night'.Now, I had a nice think on this one and I think I deduced the reason. Indian spinach has some green bugs, which in the night, are difficult to see and separate.A 100 years back everything was done by kerosene-lamp-illumination. 
Probably, an important man found a few bugs in his spinach at night. So, what did he do? The man of the house contemplated the question and said " Bingo! I'll just put this rule “no-spinach-at-night" and I won't tell them the reason too”. So most probably, that's the way it happened, with all old sayings too.

                                                                                       

Now, maybe you can appreciate the reason for the anecdote. Cold Calling in sales is something like the spinach and insect at night case. Decision makers in Industrial Plants have no time to entertain sales-people on fishing expeditions. Cold calling was never very popular with customers but it had to be done. This was the situation earlier as without cold calls; there was no way to collect authentic market information. Now as you are aware, information is power. The person with the greater power wins. 

Hence, the earlier Gurus of sales boasted of their cold calling prowess. Sales book even had chapters on how to get past the ogre which was always the tough secretary of the decision maker, chewing nails. What these guru’s don’t realize that times have changed. (Irrespective of how many copies of Spencer Johnson’s Who took my cheese? they may own-they don’t understand change) So, they continue to send new sales people into the market …” a sales person and working in the office…” No! that will never do. These people have sever affliction of what I call “ the spinach syndrome”.

  In Industrial Sales & Marketing of Capital Equipment, the internet has unseated the cold-call from its “ throne of indispensability" . Cold calling now  can be retired off and allowed to stay on for a few years more as an adviser. Information is power. Having information gives you an immense advantage over your competitors. This is all the more true in industrial marketing, where competition is limited but of the best quality and the value of a small order is not less than $25,000

But then comes the million dollar question, how can information be collected then. From the internet of course...this is evolution, you can't stop it so you do the next big thing, you join it. There are many people who will disagree but aren't there always?

How can one collect information from the web? Company web sites hardly give out that kind of  information. It is here that a little bit of creative thinking helps. I have listed out a few types of web-sites below where all information, industrial marketing managers require are available.

(1)B2B trading portals and Business Directories: These give out all the information and all you have to do is to know where the information is. (An example is http://www.processregister.com which has a section on projects. You are given the location, the value and the promoter. The website even has the projects classified sector wise. What else do you need?'

(2)Job Portals: These give out information in the form of “Project Managers required for…” or “We require for our new project…”

(3)Stock Market sites: Watch out for the analysis given in these sites. All new projects from the plan level may be found here.

(4)Websites of Consultants: Consultants often give out details of new consulting jobs they are working on.If you think that you will get full details of a project from tapping into the above or similar resources, you will be disappointed. What you will get is “leads”. Taking these leads, do some research. With practice, you will soon become adept and fast in the research. Industrial selling initiated by researching the web, is called SBR (Selling by Research).

Teach your sales people to research encourage them to do so and I can guarantee you that you will never be short of leads. In many companies, employees are not allowed to browse the net. This is a prime example of the spinach Syndrome. Here, the onus lies on the marketing manager to convince the management that this should not be applicable to the Sales & Marketing Department.

The next time your salesperson visits a potential customer, insist that he or she he knows what the prospect requires. Ask the prospect for a presentation permission. Ask them to tell the prospect how your products can help them save money. During the presentation, practice relationship selling. Show and prove that you know your product. Now, compare this to the competitor’s sales rep that pesters the customer with questions. No prizes for guessing who is more likely to be favored by the prospect for the order! Monetize your sales pitch. Don't say my equipment has 90% efficiency- say "with my equipment your energy costs will come down 20%, which means a savng of $10,000 p.a. (just a figure I plucked from the air)

Hope you liked the post. if you did, please bolster my spirits by clicking on the icons below. Have an awesome day

Love

Bilbo

What is Relationship Selling?

           Today in the capital equipment and machinery market, business volume is growing and so are the targets. But, you know that plum order from the nice customer is all yours”.  Then one day you go to your customer one fine morning, after several weeks, and ask him about “my order” [ look at the arrogance] .And he says “Oh that order, it went to the competition Ltd”.. as you realize that the order is lost forever-the one high value order on which your target was built up on.

Later on, after you finish berating your juniors and your boss stops berating you; you realize that you never had a relationship with the customer at all. This is an example of what-not-to- do in relationship selling. Do not take anyone for granted! In our line (high value engg. equipment selling) it makes you redundant and in our race (homo-sapiens)it leads to your extinction


Say, you are looking over 20 accounts, do an accounts versus sales analysis. You will find that at the most 5 or 6 account for 70% to 75% of your sale. You try to find out how many visits you made this year in 7 months, and it so turns out that you made only 1 visit, because you thought that would buy only from you. In addition, you tried to sell to the 15 customers who give you maximum 25% of the sales. What foolishness

In relationship selling, you make a relation with the customer’s key man. He may not be the person who signs the order but it is his decision, all the way. Develop a professional relationship with him. Tell the truth to him and no bullshit please. Tell him that you want the order but you also want to have a seller-buyer relation with him, so that it’s not one way traffic.

You try to help him in whatever way possible. You offer suggestions, which can help the customer increase his productivity. At first, the customer may be suspicious but later he will realize that you are sincere and honest. He will trust you although he may not trust your product. If that happens, you have to hard sell him (or her) and you should be able to do what you promise. Visit him once a week-fortnight.  This gentleman or lady then will be your friend come hell or high water. It’s you he will trust and your word will be the last word on the subject.

Build up your relationships today, all in your major revenue-earning customers, and you will not regret it no matter which company you represent, in the future. If you have a good product, the customer will buy it just because you are selling it. Hard to believe, but this is true folks. I have done it myself. There are exceptions to every rule. If you are selling swords to Atilla-the –Hun, then maybe it will not be wise to have a close relationship.

With price becoming so competitive and quality being measured in microns, the day is not far away when your relation will count. Build win-win relationships with your customers, and not only will you get the business, but you will also gain a friend. This is the magic of relationship selling.

I know a gentleman (very senior) who is now in IOCL Gujarat Refinery. We still keep in touch. And I know that if I go to him with a proposal, he will consider it, because he will be sure that what I propose is a win-win thing.

A Sneak Peek of my NEW BLOG

I can hardly wait for this,

Encounter Specialist Sadhu Agashe is back in town. And this time..it's personal....Good lines
..Hope Ramu does justice to the story.

CHARLIE BROWN , THE SMILE AND THE ALTER EGO (Republished)

We have covered the knowledge and the confidence part of it (the requirements for a successful professional sales career). Now let us take on the other stuff.  All the remaining stuff can be possessed by just and being practical and thinking of Charlie Brown (Who? Why? What the? etc..as you must be thinking if you have been with me till now..). I'll explain.

Let us make a resolution that whenever you feel that you are weighed down by your information, lack of-confidence, the criminally partial behavior of your boss to a dumb cow, office politics etc. and you are starting to sink, just mutter to yourself "Charlie Brown".. Why Charlie Brown?  Why not? 

Just tell me does Charlie Brown has any problems with anyone?. No. What will his reaction be if he was called by the dirtiest phrase there is?... Nothing. Charlie will shrug it off. Does Charlie have any jealousy or any kind of negative feelings? No .How do you know that? From his face! Think of Charlie , picture him and think that if Charlie was visiting this customer today, what would his approach be when he meets the security people. Cool and polite ! Charlie does not have a rude bone on his body.

(It is my personal opinion that Charlie , Calvin and Hobbes are philosophers. The world will be a much better place if students are taught about Charlie, Calvin & Hobbes instead of Plato & Aristotle)

So the third thing you need to have friends is “Charlie Brown”!! Finally, always be polite to the security staff-they are just doing their duty. Maybe someone is being overzealous and you are feeling the first pangs of anger! 'Charlie Brown'. well, at least someone is doing his work over-zealously then the opposite. Give your anger the bird, and  stay in your Charlie Brown mode-you will be able to go in faster inside the plant than those snobs calling themselves salesmen who want VIP treatment. Don't believe me ?Try it out! You will see that it's not fiction. It's fact! "Charlie Brown"!

I have always been Charlie Brownish in my professional life and I think I have almost saved a year of my life- counting up all those 5 minutes to 30 minutes delay that an  average VISP (very important sales person) wastes trying to convince the security chief how great he or she is and why they should therefore be allowed in without delay.

So-now you are all prepared; maybe we will venture out and maybe meet a customer very soon

Till then, it's bye from Bilbo.

And remember,

“Charlie Brown”! And once more....all together

 “ Charlie Brown”..

Re-posted on popular demand "How to get Sales Leads from the Internet"

Hi Friends-

Sorry for the long wait. We will discuss about “Sales-leads from the internet today”. A lot of people have the opinion that sales leads from the internet are worthless because everybody has access to them”.That is bullshit with a capital “B”. 

Yes, if you want to be spoon fed, then I agree. But, spoon feeding has become obsolete today. If you are selling high value capital equipment and want some leads and if you are willing to use your head a little, the net is a goldmine for “SALES LEADS”.

Let me illustrate. Let’s say that you are selling Stainless Steel Fittings all as per API. Now, when you are selling high value equipment, you get only one chance i.e. when the new plant/project comes up. Because you haven’t the chance to make repeat sales within a month like someone selling welding electrodes, the cycle is get in first-convince customer and get your order. People coming in last usually don’t get the orders. It's the early bird which catches the worm (though personally, I don't much like worms)

Get two orders and maybe you are on the way to a comfortable bonus. So-what do you do. Make sure you get these two orders by targeting 8 customers. If getting in first at 8 customers dosen't  result in two orders, may be you are not thinking hard enough, or maybe you disagree with this blog. Its'a free world-ladies and gentlemen-you do have the right to disagree with me. The catch is that you won't get your orders that way. You can't sell a product on which you do not have the confidence. So, just how are you going to get your leads without that confidence in me. So, don't waste your time here (in fact all those who disagree leaving will make those people who agree all the more likely to succeed).

But where are these 8 leads going to come from-not just sales leads but authentic requirement based sales leads. (By selecting 8 potential customers, you are also in line with the 75:25 law This is a modified form of the Pareto Principle)...From a site called processregister.com (that’s one way).Process register.com is a free info site for people like us that is those that are selling high value capital equipment.

A screen shot of the site is below.

Study the site until next time friends, when we will study how this site can help generate our sales-leads i.e 8 nos potential sales leads. This site can make you rich forever!. So study it friends till the next part and,

Until then,

its love from

BILBO

Stage II : The Most Important Stage

Hello Friends,

We now come to the middle 

portion, and the events that take 

place here, are going to make or 

break, all the hard work done. 

Here the main job is to

“Follow –Up”. Yes –I know that

follow ups can be a bit of a bore

sometimes.

But dude, there is just no help for it. You want to sell, you have to develop enthusiasm for follow-up

"Follow up has to be done if you want to sell."

There was once this Sales Guru called Pup

Whose favorite dish was fish-heads in Ketchup’

“The three basic rules" he'd say

“in the science of sales any day"

“Is follow-up, follow-up and FOLLOW-UP”

In Public Sector Tendering, what happens now is that Materials Dept. sends your file back to person who indented for it. This means the department and the officer who required it in the first place. I am assuming that you have built a relationship with the him/her by now. After that post in relationship selling, I am assuming that you-my readers-are using it to the extent possible.A few things have to be kept in mind when you are participating in Public Sector selling through Tenders, of capital equipment.

1.The "Indenter" is interested to know whether the equipment that you are trying to sell will give him the service he requires or not. Even if there is a single iota of doubt, he won’t proceed ahead on your proposal. Therefore, what you need to have in dollops is confidence. Because trust me, very few people can let their inner confusion not show outside. (The indenter will be an experienced person and he will barely need to ask two or three questions to know that you have no idea of what you are speaking about.). So try to get rid of all your confusion if you have any.

2.If you are representing a foreign OEM, then your product may have done fabulous work in Brazil and Peru. Do not make the mistake of glorifying these achievements. Their presence on your experience list is enough. Maybe you are new in India and have sold only one or two units so far. Glorify that achievement. That will serve you in better steed then the South American glorious stories.

Now, what about service? Do you have service people in your company who are competent as well as presentable? Or,  is your management only thinking about recruiting people? Or, maybe you have already hired experienced engineers and you've sent them overseas for training? Please note that you should not tell lies and untruths. If your product is slightly technically inferior, tell the truth. Even a person who is not the champion intellect is more likely to buy a slightly technically inferior product but with good service rather then a sophisticated gizmo which requires four(4) days for someone to come over from Koln.

Always remember that “ what the customer is interested in knowing: is how your product can help his organization in the subject application. He is definitely not interested in knowing about anything else before that..not the strict QA policy you have..not the prize for CRM your Paris Office won..no, nor even your recent order from Mars. This may appear to be obvious but we sometimes fall victim to our ego's. Talk to the point.

 It maybe so that your competitor's equipment had failed somewhere. Maybe your accessory life is higher. Do not criticize your competitor. Do not bring these up. Sometimes you have to be a little unethical!. But  do keep a professional looking paper which lists everything...on a plain white paper with you where your competitor's evil record is exposed and your advantages are monetized to the extent possible. Use it discreetly only when required. (say customer says”I heard that your equipment caused problems in… from… You can then say its funny, look at this..maybe I’ve got something here..Aaah here it is..I’ve never told you anything because I don’t believe in negative marketing)

That's the end of Part II and the file goes back to the Materials department.

Looking forward to the next time,we sign off now

Your friendly blogger

Bilbo

AS YOU'RE ON THE WAY

HOW TO ATTEND A TENDER OPENING (PUBLIC SECTOR)

I do not know about you guys but I find the journeying part of any process, the most monotonic. The beginning is well, a little hard but after you begins and before you end   is the period which you may find boring, but is THE MOST IMPORTANT PART in a tendering process.

In my sales career, I have had the experience of excellent beginnings neutralized by poor follow up. And it is here that temperament and the confidence is necessary. People will try to sledge you so that you lose your concentration. There are no ground rules here. Everything is below the belt. And it is here that experience pays.

Therefore, it follows that it is here, in this stage, that you will be subjected to ridicule & challenges and as in cricket, it is necessary to keep your head straight. Think of all those runs you have scored against better attacks (if you have not, imagine you would have...forget about real life, if you cannot even DREAM about winning, you are suffering from acute loser blues! My friend, perhaps you should consider a different career and I'm not trying to be funny).

I think that before we move on to another block, maybe we should have a recap. And here goes

Tender Openings: What a specialist does

1. Be present when the tender is being opened, if it is a press tender.Do not be late.

2. Try to make a rolling-your-eyes.."young kids really" expression to the bossman.

3. Don't antagonize anyone but stand up to get the information you are entitled to.

4. If the indentor is known to you, do be in a hurry to end the process, so that the other guys know the least.

5. Judge the competition and you have the idea about their bids.

6. Do not be the first person to leave the room but don't be a pest either so that they can push you out.

7. Give interesting technical answers should you get a chance.

8. Keep your ears in the customer's room. No, I don't mean use the extendable ears invented by Fred and George in "the order of the Phoenix" but think about it and it is possible.

ANECDOTE

One of the biggest dealers of KBL once tried his best to get me out of the race. He could not do anything at the lower level and went up and met the GM of the IOCL refinery. His attempt flopped and I got that order for 2 nos HSC pumps with drives and accessories, i.e. M+P landed that supply order. I don't need to mention the dealer's name as the biggest dealers in  Assam and one of the biggest in India. The same company M+P  later became a little inedible. but life is like that. Moreover, I was lucky that by the time I quit, I had acquired the rudimentary basics of  capital goods marketing. Today M+P market in NE has gone down and the conditions exist which are only a little better then when I was there. It's become the wild west all again

Finally, I forgot to tell you how to ask for an extension. Irrespective as to whether you are organized or not, you'll always find that you are unable to complete in time. Send over a fax or an e-mail asking for an extension because of blah blah( the best excuse always is to the tender justice). Remember, always ask two times what you want and you will  get it. There is a way to do everything and everything is best done in that way. You should either do it or learn how the other man does it, and then try it your way. Its the runs which matter, not how they come

I guess that does it for today.

See you next time. 

Take care and have an awesome day

Bilbo

(I put in the Beatles photo ‘cos there is a similarity...we are on the road too but specially because I am a fan)

Dear Sir or Madam, will u read my blog

it took me days to write it, I just slogged.

Its got a number of ads like a flick

Please why don't ya just click....
..Nopaper Blog writer...
Nopaper Blog writer...........

TIPS FOR SUCCESSFUL BIDDING : What to do and what not to do.

Just hope that someone finds my...

Hope that someone finds my...

Just hope that someone finds my..."MESSAGE IN A     BOTTLE"

..The Police

That will indeed be extreme i.e. you are so screwed up with your sales targets and actual results that you send a ‘message in a bottle’[ by the way did you know that Sting actually sent a message in a bottle..No? Well I’ve never heard of it too]. So now that I have your attention, let me give you some juicy and tender tips which if you know will boost your changes to win the tender. . Now, I don’t say win the tender but your chances to win it. And for those who are coming in just now, please note we are talking of Government and Public Sector Tenders.All these are stand-alone tips and this means you can do all or do one..it won’t matter excepting your chances will be enhanced to the same level.

So ready friends, here we go then:-

1. You may not have prepared the tender..maybe your sub-ordinates prepared it, maybe your boss prepared it..whatever. Do insist on your complete copy compiled exactly like the original. Go through the copy and and check if you understand each and every sentence. The key word here is understand  not agreement with. If say, you do not understand a particular sentence in the context, ask who prepared it continuously till you understand. Check the commercial terms basics. If the project is a big one and likely to take up time, checkup whether you have made your battery limits clear

2. Go through the RFP and ensure that your bid is exactly like it. Say, in the qualification criteria, there is a small hitch in your documents, make up a number ( two is enough) of replies if this is pointed out. Let us assume that you are 90% sure it will not come up, still do not ignore it.

3. If the ad says the closing time is within 1400 hours and you find that one tender has been dropped, yours is going to be no 2 then wait in the boss's office. Drop your tender in at the stroke. Say at 10 minutes past, somebody turns up huffing and puffing, he missed the bus and had to run…dept says well…but you say no.. stand in the way but if the department wants to allow him. You also allow but say that you’ll make a note in a semi-serious manner. All these varies actually depending upon your relationship strengths in the department. If you find that the tender's postponed at the last minute, go back with the tender collecting a copy of the notice. Do not drop the tender before time cos baby, that's what losers do.

4. The tender opening process. Don't try to say" Please once more" twice. You need to have your own shorthand system ready to note down the salient points. During the techno-commercial, ask questions to get to know your competitor's bid. You are entitled to know. Not everything needs to be noted down

5. The Ace card : Most Indian firms send their junior most people to tender openings which is an ace-in –the –hole card for you in two ways. You are the General Manager, and you are there whereas your competitor has only two Sales guys. The Boss-man has to be there-it is probably his office in the first place..he will love you. He won’t say anything but you and him are more similar in experience etc. and you are showing him respect. That’s an ace right down the middle: an enormous plus in your favor.  What you say or do will carry more weight now. Experience counts however but what if the boss is very close with the your competitor’s boss, sometimes it may not matter. Make it matter or give a complicated explanation to something which the other guys cannot participate in.

6. The tender opening of part 1 is complete. Everyone will start signing on the papers opened. They will bring a sheet to you to sign as the rep of your company. Here, refer back to point 3, and jokingly say that you are going to write a note, how X party was late and write it. Sometimes it is not necessary, but all those can be learned only with time.

Shake hands again, make small talk and then take your leave. Ensure your competitors leave before you

So next time we will see what is the next part ..For fun lets consider this day as Day 01. (Here day means calendar day, not a working day)

Bye then, till the next time

BILBO

NB: I don’t know what your philosophy of tendering is dear reader but mine is “ GET THE JOB AT ALL COSTS”. But no one can do that . Even DiMaggio’s streak had to end, so just add this line” IF I DON”T GET IT , I’LL ENSURE THAT NO OTHER S.O.B. GETS IT”. I have told you this because my blog posts will move as per that line. You should be knowing this beforehand, that’s what I feel.

Bye till the next time

PUBIC SECTOR OPEN TENDERS : How to win 'em

First of all, I want to tell my readers that the sales methods I have outlined here will work in the  Indian sub-continent without a hitch. But the US or Europe..I'm not sure ..You will need to compensate for culture differences. If you can do that , the work's yours. Why I say this is because I saw a visitor to this blog from google, him or her getting the link by searching google for" How to sell to Public Sector in the US". So, I''m really sorry but you won't have success 100% through this blog. You'll know important things which will help you in your career. If you are really interested, send me a mail and I'll revert as soon as I get the time

Some rules in a Public Sector Press Tender, worth mentioning i.e. The Weak Links where the defense can be breached, have been roughly given below as A few weak links in the tendering process. Before we do that, let me share some specific properties of press tenders with you.

A Press Tender usually is a two-part type. Part I (the Techno-commercial Bid ) and Part II (the price part), being the two parts. This is done to save time.

For system tenders, one technical bid can run to 100 or more pages. Generally, there are some pre-qualification norms, which you have to satisfy. The proof of these should be enclosed in the Techno-Commercial Bid. Say, for a job of fabrication and laying of a cross country pipeline where the estimated cost is $500 million, you need to have executed at least two similar projects of $200 million or more, in the past two years. You need to have certain equipment and machinery-if you do not own them, at least you should have access to. You need to have financial solvency so that client is assured of your capability to meet the operating/running expenses.

Let us consider a hypothetical party of five parties tendering for a job. The pre-qualification criteria which also includes the EMD criteria are checked first and if you do not satisfy them, out you go. Next comes the say of the technical indenter who will read over the remaining tenders. Let us assume, he finds two are okay and another, dicey. He scraps it.

Next come the contract commercial and special conditions. Everything is examined. Have you accepted the customer’s payment terms. What is your validity? What is your price basis? Have you considered taxes etc. If yes, at what rates? Etc., etc. Now this is not boring at all. In fact, it is very interesting and if you are feeling bored, the composition-al talents of the undersigned or their lack, is to blame and not the facts themselves.

Finally the two parties who qualified are called and told that the price-bids will be opened on such and such date and time. (The Price bids of the others are returned unopened). The price bids are opened and generally, the lowest gets the order. That is the gamut of the Public Sector Press Tender. Finally, what about time? The period from the date of the press ad to the date of order placement will take not be less than six to eight months. Tough if you are in a hurry but sorry pal, you have to wait.

 

Now that I have told you briefly, the entire tendering process, I will elaborate on those weak links and perfectly legal ways to gain an advantage over the other parties, by using these weak points of access, in my next post.

                                             So for now, its

                                             Adios  Amigos!

                                             Hasta la Vista,

                                             Bilbo

Selling to the Public Sector: LIMITED AND OPEN TENDERS

Before I proceed, I want to say that I do not advocate winning tenders by paying bribes. In in my career, I have indeed gifted bottles of scotch and a book on one occasion (a copy of Pirsig's “Zen and …. Maintenance”), but not as a bribe. Any person can win an order by paying a bribe. The challenge lies in getting the order and keeping the process within ethical boundaries. This blog does not condone or advocate bribery or canvassing in any form.With that out of the way, let us now come back to our subject. If you want to do business with the Public Sector, the  first thing you should know that is the chain from the requirement identification stage to the tender stage and then the Purchase Order stage.

P

ublic Sector Tenders are of two types-Open or Limited. What are these? Open is the tender as we know it. Limited tenders are actually quotation requests. They are  sent to specific OEM’s/Traders who are registered with the Materials Department and are asked to quote for items within a particular date. There is no earnest money involved, as the Materials Department knows you are in earnest. A limited tender may be sent to your competitor and not to you.   There are two main differences between Limited and Open Tenders.

1.   1.      You are not allowed to be present when the offers are opened, and ...

2.  The tenders may not be opened at a particular date specified, but postponed by a day, 2-3 days even a week (depending upon the convenience of the officers who are required to be present).

 Once everything is alright, the offers are opened and the prices, commercial terms are listed, and the file is sent to the indentor. The indentor goes through the offers, rejects offers which he does not have technical confidence in and returns it back to Materials, who then sends it to Finance for clearance. Finance checks out the proposal and vetts it and sends it back to Materials. The Materials head then signs the file and deputes his assistant to release the PO, who gets it made, checks and signs it, gets it countersigned and releases the PO.

Why are some tenders limited and some public? It depends on the value (landed) of the offer.  Limited tenders can be floated only when the total cost estimate does not exceed a fixed sum which may differ from organization to organization.



Although the process looks complex, it is actually simple. Read it again and you will get the drift of sense coming out of that allegedly complex mumbo-jumbo.

Till next time then? 

Ja?

Auf Widersehen

Bilbo

Prologue: (Indian Public Sector business)

Some commonly used abbreviations

NIT: Notice inviting Tender

EMD: Earnest Money Deposit

ICB: International Competitive Bid    NCB: National Competitive Bidding

RFQ: Request for Quotation  

RFP: Request for Proposal

P&F: Packing and Forwarding

DGSD: Directorate General of Supplies & Disposals (Under the ministry of Commerce and Industry)

ST: Sales Tax   CST: Central Sales Tax

IC : Interchangeability Certificate

These are some abbreviations, which you will come across when you do business with the Indian Public Sector. It is an irony that the very rules, which were, enforced for transparency in Public Sector dealings have now become the bane of the Public Sector, for you can take advantage of them if you wish to.

It should not be assumed that the Indian Public Sector is totally corrupt. It is nothing like that. Corruption is a way of life in the states but not in the centrally administered Public Sector Units. If fingers can be pointed to the Public Sector then it is only in the respect that they are bound and tied by the lowest rule, even if they are well aware that the lowest party got through the technical scrutiny only based on assumptions.

What is true is that the Public Sector Officers remain confined to their departments. If  the maintenance department and the planning department have got some overlaps, no one co-operates officially because “it’s not my job”. This attitude and the so called transparency attitude are now the major woes of the Indian Public Sector. As a reputed Materials Manager once told me “As per the existing rules, we can remove our clothes. But if you think that we are going to show you our briefs, you got another think coming”. Bully for him.

In this section, I’ll guide you through the quagmire of doing business with the Indian Public Sector, but never in a negative way. The State Government departments.... They are beyond salvation now. What do you say about the Chief Engineer of a WB State department who on asked to state the reason for the discrepancy of  official treated water figures and actual treated water says that he will be risking his pension if he makes public the figures for the public works that his department has done. All this in a linked in discussion forum, too. And this gentleman is now looking for a consulting position (after his impending retirement) abroad in the US(probably where his sons or daughters are settled) so that he can pass on his expertise in showing 1 equals to 2, to his US bosses.

Here I conclude this prologue, friends with the hope that you will like it.

It is not my intention to thrill or educate but only to tell you what you will be able to find yourself but at the cost of time. The novel, the plot of which, is outlined here. starts from my next post.

Till then,

It's 

Merci et Adieu

Bilbo