Preparing your electrical business for large tenders

It’s one thing wanting big contracts, it’s another being ready for them. We spoke to Rachelle Hare, Managing Director of Blaze Business & Legal about getting your business ready for tendering for jobs with Tier 1 or Tier 2 construction companies, councils or government.

Rachelle Hare is the Managing Director of Blaze Business & Legal and has over 25 years of experience as a Construction Lawyer, Commercial Manager, and Business Adviser. She has worked for companies like Thiess, Laing O’Rourke, Acciona, Golding, UGL and Frequentis, as well as for Defence Housing Australia, the Australian Government Department of Defence, and Australian Government Solicitor.

At Blaze Business & Legal, Rachelle and her business partner, Shannon Drew, help SMEs in the construction industry restructure and grow by getting their compliance, contracts, and processes in order so they can bid for – and win – government tenders, including work connected to Brisbane 2032, and how to avoid the post-2032 downturn. So, they’re well placed to answer some big questions!

How much emphasis do tender assessors put on the commercial side compared with the technical side?

The irony is that tender assessors don’t seem to put as much emphasis on the technical side as the commercial side. If your tender demonstrates your technical skills and those of your employees and contractors, I’ve found that tender assessors are likely to rate your business pretty much the same as other tenderers who have also demonstrated they can do the work.

To say that in a different way, your skills and experience aren’t usually the thing that wins you the job (unless it’s for a high-skill project where you are one of the few who have the relevant skills). It’s the commercials that will get you there.

What tender assessors really want to understand is whether your business can support the work. They look for structure, staff, reporting, safety practices, cashflow, project management, and proof that you have the systems to carry out and complete a larger job.

Tips:

• You’ll have to show that you hold the correct licences and qualifications/skills to do the work being tendered for at the site. So make sure your licences (personal and company) are always up-to-date and keep the evidence (certificates, receipts etc) somewhere easy to attach to the tender response.
• Make sure you know what licences and qualifications you need to perform your work and be compliant. First Aid Certificate? Working at Heights Qualifications? Make sure you get them well before you need them each year. And make sure your staff have them too if needed.
• Work on putting together a two-page marketing handout which includes some of your experience on projects and also includes some client testimonials. You can pop that in your tender, and it works really well for giving you an added edge. Get a marketing company to give it a spin if you’re not great with business development wording.
• Gather three clients now who will be happy to be your referees for any tenders you want to submit in the future. Obviously, these should be clients who were happy with your work and will give you a glowing reference. If you ask them for permission now, you can include them in any tender response that asks for  referees – it will save you scrambling to find someone on a deadline.

 

What does it look like when a contractor is not ready for a big contract?

You can see signs when someone is not ready for a larger contract. I’ve helped a number of businesses get ready to tender, and I’ve assessed a number of tenders for large contracts (private sector and government). Some things really stand out:

The classic one is the owner doing everything: Estimating. Site supervision. Admin. Ordering. Accounts. Sometimes even the electrical work itself. This works on small projects but can quickly break your business (and you) on bigger ones.

By the time you’re tendering for large projects, your client will expect you to have the staff, systems, and structures to make those projects a success. And you’re expected to be running the company (or to have a MD or CEO to run it for you), not be on the tools and doing everything else as well.

Contract Management is a big one. If you can’t demonstrate how you will manage a contract if you’re awarded it, the client will see your business as too high-risk.

Other signs show up as well:

• No job management system
• Insurances that have lapsed or aren’t sufficient for the work you do now
• A safety plan that no one has opened in years
• No dedicated accounts or safety divisions
• Not enough staff to carry out the work being tendered for
• No apprentices (for future-proofing)
• No documented case studies and client testimonials

If your business processes, systems, and information are all in your head, or if everything in the business relies on you to do it, approve it, and action it, your business is not ready to cope with a larger tender. Ask yourself what would happen if you got sick for a week?

 

What should contractors put in place if they want to tender for larger jobs?

If contractors want to step into larger tenders, they need to have the right foundations in place long before they see the tender documents. You don’t need to be a big company to win large work, but you do need structure, systems, and proper commercial set-up. Here’s what matters:

Start with the basics – roles and reporting lines

Make sure your business has clear roles, responsibilities, and reporting lines. Even a simple organisational chart works wonders. Larger clients want to see that you’re not a one-person show doing everything. They want to know you can supervise people, track progress, manage risks, and make decisions without delays.

Get your internal documents sorted

This includes having up-to-date safety documents, licences, insurance certificates, a safe work method statement (SWMS), induction procedures, quality checks, and environmental processes. These need to be current and easy to upload or attach to a tender response. If they’re buried in emails or saved as outdated versions, it sends the wrong message.

Build the financial foundations

Larger projects require stronger cashflow. Assessors aren’t expecting you to be a huge company with millions in the bank. What they need to see is that you can handle the financial load. Can your business cope with paying wages, materials and overheads while waiting for longer payment cycles? Many SMEs underestimate this part.

Know who will manage your contracts

If you win the job, you’ll need to manage contract notices, RFIs, delays, variations, program updates, and reporting obligations. If you haven’t appointed a Contract Manager or don’t have a system for keeping on top of deadlines, you’re at risk.

Use simple systems to stay organised

Larger clients expect consistent processes. This includes:

• Job management software (SimPRO, AroFlo, Tradify)

• File naming rules

• Folders for each job

• Version control for documents

You don’t have to use expensive software. You just need something reliable that your team will actually use.

Build your workplace structure now

Larger clients expect visible structure. Clear job roles, consistent workflows, documented procedures and the ability to supervise people safely. You don’t need to be perfect. You need to show you’ve thought it through and have a system in place.

Tips:

• Most contractors don’t realise that government tenders often require proof of financial capacity in a specific format. You’ll need things like a statutory declaration from your accountant, bank statements covering specific periods, and sometimes a letter of support from your bank. Start building relationships with your bank and accountant now so they understand what you’re trying to achieve and can support you when tender deadlines hit.
• Here’s something almost no one knows: tender assessors will Google your business name and check your online presence. If your website looks abandoned, your Google reviews are full of complaints, or your LinkedIn shows no activity, it affects how they see you. Clean up your digital footprint before you start tendering.
• Start building your tender library now. Templates, case studies, organisational charts, safety plans. Don’t wait until you receive a tender response to scramble.
• If you don’t have the systems to manage contract obligations, speak to me about a Contract Management retainer. I manage notices, deadlines, risks, and compliance for many SME contractors across Queensland on a fixed monthly fee.
  
  

From a financial perspective, what do contractors need to demonstrate to win large contacts?

Financial readiness is one of the biggest stumbling blocks I see for SMEs who want to tender for larger work. Tender assessors are not expecting you to have millions in the bank. What they want is confidence that your business can withstand the pressure of a bigger job.

Cashflow capacity matters more than revenue

The biggest question is whether you can fund labour, materials and operating costs for 30 to 60 days before progress payments come in. Many companies can deliver the work technically but fall over because the cashflow crush hits too hard.

You need clean, current financial information

This includes:

• Up-to-date BAS statements
• Tax lodgements
• Financial statements
• Bank summaries

Everything needs to be current and consistent. No gaps, no late lodgements.

Know your labour costs properly

Most SMEs underestimate the true cost of labour because they forget to include:

• Superannuation
• Payroll tax (if applicable)
• Workers compensation
• Annual leave loading
• Overhead recovery

When you’re bidding on larger jobs, margins get tight. Small mistakes in labour costing compound quickly and can kill your profitability.

Understand your required margin

This is the margin you must earn so that your business stays profitable. You need to know your business breakeven point and what margin is typical for government work in your industry. If you don’t know this, you’re pricing blind and you’ll either price yourself out or win work that loses you money.

Tips:

Most electrical contractors price their labour based on what they think is the going rate, not what their actual costs are. Calculate your true labour cost per hour including all on-costs and overheads. Then compare that to what you’re charging. The gap is often shocking.

• Government contracts often have longer payment terms than private work. Model out what happens to your cashflow if you’re waiting 45 or 60 days for payment instead of 30. Can you still pay wages and suppliers? If not, you need to build a buffer or arrange finance before you tender.
• If you’re unsure whether your business can cashflow a larger job, speak to my business partner, Shannon Drew. Shannon is a Management Accountant and can build you a cashflow model that shows exactly what you need before you commit to a tender.

What matters from a compliance and business practice perspective?

Compliance is a huge part of government and tier-one tendering. It’s not just safety. It’s the whole operational backbone of your business.

Your safety system needs to be active, not dusty

Tender assessors want to see that:

• Your WHS Management Plan is current
• Your SWMS are up-to-date and site-ready
• You have proper incident and induction processes in place

A safety plan that hasn’t been opened in two years will not pass muster.

You need the right written policies

Government tenders will often require policies such as:

• WHS
• Quality
• Environmental
• Drug and Alcohol
• Fatigue Management
• Procurement/Purchasing
• Risk Management

Many SMEs don’t have these. It becomes a major barrier when they try to tender.

ISO 9001 comes up more often than people expect

Not all government tenders require it, but some do. If you think ISO certification might be in your future, start preparing early. It’s easier than people think, especially when someone manages the certification process for you.

Compliance registers reduce risk

You should have a simple register that tracks things like:

• Staff licences and expiry dates
• Contractor licences and expiry dates
• Insurances and renewal dates
• Visa conditions (if applicable)

If you want to stand out to government assessors, a compliance register is one of the easiest wins.

Tips:

• Here’s something most contractors miss: you need to prove your policies are actually being used, not just sitting in a folder. Keep records of toolbox talks, induction sign-in sheets, incident reports and training attendance. Tender assessors will ask for evidence that your systems are active.
• If you’re tendering for government work, make sure your policies reference the correct legislation. Generic policies downloaded from the internet often cite NSW or Victorian laws. Queensland has different WHS legislation and you need to get it right.
• Many contractors think they need expensive consultants to get ISO 9001 certified. You don’t. We can project-manage the certification process for you and it’s more affordable than you think.
• We can prepare a full suite of government-tender compliant policies for you, tailored to electrical contracting and the work you actually do.

Contractually, what are the things businesses need to watch out for?

This is one of the areas where business owners get into trouble, especially those moving into larger tenders for the first time.

Government and tier-one contracts are structured, strict and time-bound

They include obligations around:

• Notices
• RFIs
• Delays
• Variations
• Program updates
• Reporting

If you miss deadlines, you can lose your rights. Even if the client caused the delay.

You need the right templates before you tender

If you win a job, you’ll need contract-ready templates for:

• Delay notices
• RFIs
• Variation requests
• Site records
• Progress reports

These need to be drafted with the contract in mind. Generic templates downloaded from the internet won’t cut it because they don’t reference the correct contract clauses.

Understand your Security of Payment rights

Many SMEs lose money because they don’t follow the correct payment claim process. The Act is strict. You need clear internal steps for payment claims and payment schedules. Miss a deadline and you lose your right to adjudicate.

Know your delegations and responsibilities

Who sends notices? Who tracks deadlines? Who checks program changes? If no one is responsible, nothing gets done. And you’re the one who wears the risk.

Tips:

• Most contractors don’t realise that delay notices need to be served within very tight timeframes. If the contract says two days and you take four, you’ve lost your right to claim time or money for that delay. Set up calendar reminders and tracking systems now, not after you win the job.
• Here’s a mistake I see constantly: contractors submit payment claims that don’t comply with the Security of Payment Act because they’re missing key information or they’re sent to the wrong person. One missed detail and your claim is invalid. Get your payment claim template checked by someone who understands the Act.

 

What else do contractors need to know?

A few final things stand out when I’m advising SMEs who want to move into bigger work.

Don’t wait until a tender appears to get ready

Tendering is competitive. The businesses that win already have their house in order. If you wait until the tender is published, you’ll spend the entire tender period scrambling for documents instead of pricing the work properly.

Government clients value reliability and professionalism more than size

A smaller business with strong systems will beat a larger, chaotic one every time. They’re not looking for the biggest contractor. They’re looking for the contractor who can deliver without drama.

Apprenticeships and staff development matter

Larger clients want to see:

• Training programs
• Development plans
• A pipeline of new trades

It’s a sign you’re building a sustainable business, not just chasing the next job.

Your business must be able to operate without you doing everything

If your business collapses when you’re sick, on holiday or on the tools, you’re not ready for large tenders yet. Tender assessors will see straight through it.

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