Why You Keep Losing Tenders Even When Your Price Is Lower

The pattern is familiar to many contracting, MEP and supply companies. The pricing team works late, the margin is cut to the bone, the bid goes in at or near the lowest figure, and the award goes to someone more expensive. The conclusion drawn inside the company is often the same: next time, go lower.

In our experience, that conclusion is often wrong. In a tender evaluated on technical and financial grounds, price is usually compared only after the technical file has been opened, checked for compliance and scored. A bid can be lost long before anyone looks at the number. This diagnosis works through the symptoms, the causes that typically sit behind them, how to check each one in your own files, and what to fix first. It is written at framework level, with examples from Saudi and Egyptian public procurement, because the logic is similar in most two-stage tenders across the GCC and Egypt. Always follow the rules in the specific tender documents.

Symptoms: how this problem shows up

Look at your last ten to fifteen tenders. If several of these apply, it is a pattern, not bad luck.

• You are often the lowest or second-lowest bidder, and still not awarded. The win rate does not improve when you cut price further.
• Some results come back as “technically not accepted” or “not compliant”, and the team is not sure exactly why.
• The technical envelope is assembled in the last two days, after the pricing is finished, from the previous tender’s files.
• The same company profile goes into every submission, whatever the scope, client or evaluation criteria.
• Nobody asks for the reasons after a loss. The file is archived and the team moves to the next deadline.
• You keep losing to the same two or three competitors, and the explanation given internally is “they have connections” or “they bid lower”, without evidence.

The last two symptoms matter most. A company that never asks why it lost cannot tell a price problem from a technical one, so it keeps treating every loss as a price problem.

Five likely causes behind a lost tender

“We were cheaper and still lost” usually comes down to one or more of these causes. Each one is fixed differently, and a lower price fixes none of them.

Why price is often not even reached

Under Saudi Arabia’s Government Tenders and Procurement Law, where technical and financial proposals are submitted separately, only the technical proposals are opened at the opening session (Article 44(1)) and only the technical proposal is reviewed at first (Article 46(2)). Technical proposals that do not meet the requirements are disqualified and their financial proposals are returned intact with the initial guarantees; the committee then examines the financial proposals that came with the accepted technical ones (Article 46(3)). The tender documents must state the criteria used to assess, compare and accept proposals (Article 24), and the review committee recommends the best proposal under those criteria (Article 45), not automatically the cheapest. Egypt’s Law No. 182 of 2018 follows the same two-envelope logic: financial envelopes are opened only for technically accepted bids (Article 23), according to an English translation published by Andersen in Egypt; the official text is the Arabic one. For the full Egyptian envelope, see how to build the technical offer in Egyptian government tenders.

In other words, the price you worked hardest on can be the part of the bid nobody opens.

Why a technical gap can outweigh a lower price

Saudi Arabia’s controls for preparing bid evaluation criteria (Arabic, version 1.0, March 2021, issued by the Expenditure Efficiency and Government Projects Authority) set out how weighted tenders are scored. Check whether a later version applies to the tender in front of you. A bidder’s technical score is its average technical points divided by the highest average among the offers. Its financial score is the lowest price divided by its own price. Each is then multiplied by the weight the tender sets. The same guide says the buyer sets a minimum technical score an offer must reach before its price is evaluated, and lists basic pass/fail criteria such as meeting the main technical requirements, committing to the required schedule and submitting a time-bound work plan.

A hypothetical example (illustrative figures only, not a real tender). A tender is weighted 30% technical and 70% financial, within the range the guide suggests for high-value construction. Bidder A is the cheapest and scores 60 technical points. Bidder B scores 85, the highest. Bidder A’s technical score is 60 divided by 85, about 0.71, worth roughly 21.2 of the 30 available points; B gets the full 30. To win on total score, A has to make up about 8.8 points on price alone. With these weights, that means A would need to be roughly 13% cheaper than B. If A is only 5% cheaper, B wins by about five points. In this example, the 25-point technical gap is worth more than a price cut most bidders could realistically make.

Why a very low price can work against you

Low prices are not automatically rejected. The Saudi law states that no proposal may be disqualified simply for being low, but the committee may recommend disqualification where the price is 25% or more below the estimated cost or market price, after it has discussed the price with the bidder, asked in writing for item details and an explanation, and remained unconvinced the bidder can perform (Article 48). Private buyers set their own rules. In our view, a bid that looks too cheap with a thin technical file invites exactly that doubt.

How to check each cause in your own submissions

A small team can usually run this check on its last five lost tenders within a week or two. Take the original tender documents and the files you actually submitted, not the drafts.

1. Rebuild the mandatory checklist. List every document, form, certificate, signature, stamp and guarantee the tender required. Tick each against what was uploaded. Note anything submitted in the wrong format, expired, unsigned or under a different company name. One gap here can explain a loss on its own.
2. Find the evaluation criteria and weights. Copy them from the tender into a table. Mark which were pass/fail and whether a minimum technical score was stated. If your team cannot find this section quickly, that is already a finding: the proposal was not written to it.
3. Score your own proposal as an evaluator would. Ask someone who did not write it to award points against each criterion, using only what is on the page. Anything they cannot find in two minutes, an evaluator may not find either.
4. Audit the experience section. For each project you listed, check whether the file shows the scope, the contract value, the client, the dates, your role (main contractor, subcontractor, supplier) and proof such as a completion certificate or reference letter. A list of client logos is not evidence of similar work.
5. Audit the team section. Check whether key staff named in the proposal match the roles and qualifications the tender asked for, and whether CVs lead with the relevant experience.
6. Compare your price with the estimate. Where the client published an estimate or you received a clarification about your price, note how far below it you were and whether your file explained how you would deliver at that level.

Use the loss debrief instead of cutting the margin

The most useful source of evidence is usually the client, and many companies never ask. Public frameworks generally give bidders some route to the reasons behind a decision. Egypt’s Law 182, in the same Andersen translation, requires exclusion and award decisions to state their reasons, lets bidders ask why their bid was not accepted, and gives them seven days from notification to submit a written complaint (Articles 35 and 39). The Saudi law requires the agency to announce results and notify other bidders (Article 49), observe a suspension period of five to ten working days before the award is approved or the contract signed (Article 53), and accept a bidder’s grievance within five working days of a decision taken before the award, or within the suspension period against the award itself (Article 87). Escalating a grievance to the appeals committee requires a guarantee (Article 86), so take advice before using this route. For most companies the more useful habit is simpler: ask, in writing and promptly, for the reasons and for feedback.

Development banks that fund projects in the region formalise this as a debriefing. The EBRD’s guidance on debriefings by clients (May 2023) describes the purpose as helping an unsuccessful bidder understand the grounds for rejection and how it can improve its future chances, asks for requests within seven calendar days of receiving the evaluation outcome unless the procurement documents set another timeline, and states that confidential information, such as other bidders’ financial and commercial details, is not shared. That is a useful model even for private tenders, where no rule obliges the client to explain anything.

How to ask for a debrief

• Ask quickly and in writing, within the window the tender or framework allows, from the person who signed the bid.
• Ask about your own bid, not the winner’s price. You will not be told a competitor’s figures; you may be told where your file was weak.
• Ask specific questions: Was the technical offer accepted? Did it fail any mandatory or pass/fail item? Which criteria scored lowest? Was anything missing or unclear? Was the price considered realistic?
• Keep the tone professional. A debrief is a learning conversation with a client you want to win next time, not an argument about the result.
• Log every answer in one register across all tenders. After five or six debriefs, the real pattern often becomes clear.

What to fix first

Fix in this order, because each stage decides whether the next one is ever looked at. If you are not being invited to tenders at all, the problem comes earlier, at vendor registration, and needs a different fix.

1. Compliance before everything. Build a compliance matrix for every tender, one row per requirement and criterion, with the owner, the evidence and the page where it is answered. Do a final check against it before submission; it removes the most avoidable losses.
2. Write the technical offer to the criteria. Use the criteria’s own wording in your headings, follow their order, and put a short summary at the start of each section. Our guide on how to write a technical proposal for tenders covers the section-by-section structure.
3. Rebuild how you present experience. Replace the generic profile with a project reference library and a company profile built for pre-qualification: one consistent sheet per project with scope, value, client, dates, role, photos and proof, so the right projects can be selected for each tender quickly rather than rebuilt under deadline.
4. Make the submission look like one established company. A consistent template, terminology and visual system across the profile, proposal, CVs and method statements makes evidence easier to find and signals organisation. This is where brand identity and document design serve a commercial purpose rather than a cosmetic one. For Azeidk, a contracting and MEP company in Saudi Arabia and Egypt, RX’s sales communication work included company presentation content, service summaries, offers and project document content, all built on one service architecture so every document describes the company the same way.
5. Only then revisit price. Once you are passing the technical stage and scoring competitively, you will know whether price is really the gap, and how large it is.

Two habits support all of this: a bid or no-bid decision before writing starts, and a debrief register reviewed every quarter.

Before the next tender closes

Pick the last five losses, rebuild the mandatory checklist for each and score one proposal as an evaluator would. If the gaps are in documents (profile, references, CVs, templates), that is work an outside team can prepare while your engineers keep running projects; if they are in pricing or capability, they are not.

RX Designer works on the documents side of this problem through its business solutions and sales enablement service, which covers proposals, technical and financial offers, and tender and pre-qualification files built on the client’s brand. The client approves the content. RX has handled supplier and tender registration for clients on Saudi platforms such as Etimad, with the account kept in the client’s name; the client’s authorised people submit the bids, and the award decision always rests with the buyer. If you want a second reader for the check, bring those five lost tenders and any debrief answers to a business diagnosis session and we will go through where each one was decided.