Consortium Bidding
Discussion
Hi, Im looking to put a consortium of small businesses together to bid for some larger projects.
The companies are generally 1 or 2 person limited companies.
Does anyone have an idea on the legal framework we need to put together to be taken seriously. The project sizes aint huge in real terms but big to us 250-500k
cheers
G
The companies are generally 1 or 2 person limited companies.
Does anyone have an idea on the legal framework we need to put together to be taken seriously. The project sizes aint huge in real terms but big to us 250-500k
cheers
G
My response assumes that the contracts are public sector but the same may also apply to private sector bids.
There are generally no legal requirements over consortium bids unless of a certain nature and the details of this will be contained in the supporting documentation with the tender. If consortium bids are not allowed, this will be implicit on the supporting documents,
Most public sector organisations provide guidelines on this approach in the details and if not, then get in touch with the procurement officers for clarity. Generally speaking, they will want to see a “lead company” within the consortium who will take overall responsibility for the project and a clear indication of how the consortium will work together with % splits of who does what and who will be invoicing for the work.
Main hurdles will possibly be any “limit of trade” clause (i.e. no single contract being worth more than 25% of the previous year’s turnover). They may also look for the lodging of a performance bond for the duration of the contract. If they do, ask if the interest you would pay on this can be charged on to the client.
Assuming this is an on-going thing, then may be worth considering setting up an umbrella company, the shareholders of which are the other companies (them becoming “group” companies).
Hope that helps.
There are generally no legal requirements over consortium bids unless of a certain nature and the details of this will be contained in the supporting documentation with the tender. If consortium bids are not allowed, this will be implicit on the supporting documents,
Most public sector organisations provide guidelines on this approach in the details and if not, then get in touch with the procurement officers for clarity. Generally speaking, they will want to see a “lead company” within the consortium who will take overall responsibility for the project and a clear indication of how the consortium will work together with % splits of who does what and who will be invoicing for the work.
Main hurdles will possibly be any “limit of trade” clause (i.e. no single contract being worth more than 25% of the previous year’s turnover). They may also look for the lodging of a performance bond for the duration of the contract. If they do, ask if the interest you would pay on this can be charged on to the client.
Assuming this is an on-going thing, then may be worth considering setting up an umbrella company, the shareholders of which are the other companies (them becoming “group” companies).
Hope that helps.
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