Benefits of Bundling Services and Scopes of Work when Tendering

Procurement strategies typically have a strong focus on cost reduction, efficiency gains and improvement of services.

These improvements can be achieved by bundling multiple service requirements into a single contract.

Bundling products and services into the same contract may present more attractive packages to contractors, resulting in an improved value-based outcome.  This represents the 'first step' towards potential complete turn-key contract solutions in the future.

Bundling services may reduce the number of contractors organisations need to manage. Contractors may offer significant price discounts or other value-added outcomes to ensure they win contracts that provide larger revenue returns.  

Example:
Due to the inclusion of multiple scopes into one contract, the spend is typically higher than individual contracts that cover only one scope. Therefore, collective spend discounts can be included in contracts with 'discounts or rebates' applying to the pricing once specific spend thresholds with a contractor is reached.
A 3% discount on the agreed contract rates could apply once contract spend reaches $1 million with a contractor during the term of the contract, and a 5% discount applies once contract spend reaches $2 million.

 

For more information on bundling services and procurement contracts, please contact Brian Jackson, Director Consulting, bjackson@wearepeak.com.au