Bid/No-Bid Analysis

Also known as: bidding decision matrix, bid decision matrix, bid analysis matrix, bid decision analysis, bid/no-bid decision matrix, bid/no-bid analysis matrix, bidding analysis matrix, bid/no-bid decision analysis matrix, bid vs. no-bid analysis, bid versus no-bid analysis, bid/no-bid response decision, bid versus no-bid decision, bid/no-bid process, bid vs. no-bid decision, tender/no-tender analysis, bidding decision analysis, bid/no-bid decision analysis, tender/no-tender decision analysis, bid matrix, bidding matrix, bid/no-bid analysis, bid/no-bid decision, or bid/no-bid matrix.

What is a Bid/No-Bid Analysis?

Bid/No-Bid Analysis Definition

The bid/no-bid analysis is the assessment, whether quantitative, qualitative, or both, of risks inherent to the choice of whether submitting or not submitting an offer upon receipt of an invitation to do so.

Also known as: bid decision analysis, bidding decision analysis, bidding choice analysis matrix, bid choice analysis, bid/no-bid decision analysis, bid/no-bid analysis, tender/no-tender analysis, bid/no-bid analysis method, bid/no-bid process, bid/no-bid choice analysis, bid/no-bid analysis process, bid vs. no-bid decision, or bid/no-bid decision.

To Bid or Not To Bid?

That is the question.

The definition of chance is to be ready when an opportunity happens
--Miyamoto Musashi,
The Five Rings

There is a common saying that states that there is no problem, however complex it may be, that can't be solved by a lack of decision. It's true, but only when it applies to Politics. In our case, there's no place for "I don't know". Whatever option you choose, you have to live with it, and acknowledge the consequences by taking the appropriate actions.

Furthermore, the fastest, and easiest way to increase your ratio of winning proposals or bids is not to bid or send a proposal when your chances of winning are null, very low, or below the bid threshold you have priory fixed. Indeed, the last thing you want to do is to drain resources from your daily, costly business operations merely for the sake of bidding. So, do your homework.

You will perform a so-called bid/no-bid analysis, decide whether to bid, that is. If you decide to submit a bid, you will send a letter of intent to express you intention to bid. If, at the contrary, for any of the specific reasons described in upcoming sections, you find this opportunity not so appealing that you decided not to bid, you are highly encouraged to send the requesting organization a no-bid letter. Remember, they invited you to submit an offer because they thought you were worth it. So keep your chances to do business with them in the future optimal.

Communication is a key factor in any successful procurement system. So your response to a Request for Proposals (RFP), Invitations for Bids (IFB) or Invitation to Bid (ITB), whether positive or negative, is not only appreciated but almost mandatory should you want to be involved in future opportunities. Indeed, if you don't want to play the game by the rules, they are people who will make sure you can't play next time.

Bid/No-Bid Analysis

The bid/no-bid analysis takes the form of a bid/no-bid checklist, which could be later transformed into a bid/no-bid decision matrix.

Bid/No-Bid Checklist

The bid/no-bid checklist is the list of questions, as shown below in a non-exhaustive manner, you should ask to yourself to gauge benefits over risks, whether bidding or restraining yourself.

  1. Project budget
  2. Project timeframe
  3. Resources for proposal/bid
  4. Investment needed
  5. Return on Investment (ROI)
  6. Technical expertise
  7. Management expertise
  8. Differentiators from competitors
  9. Information gathering vs. real project
  10. Political considerations
  11. Previous relationship
  12. Project already funded

The Bid/No-Bid Checklist is also known as: bidding decision checklist, bid decision checklist, bid choice analysis checklist, bid analysis checklist, bid/no-bid decision checklist, bid/no-bid analysis checklist, bid/no-bid choice analysis checklist, bid/no-bid process checklist, tender/no-tender checklist, bidding analysis checklist, bid/no-bid decision analysis checklist, bid checklist, bidding checklist, or bid/no-bid checklist.

Bid/No-Bid Analysis Matrix

The Bid/No-Bid Analysis Matrix is a derivate version of the concept of decision matrix.

Leveraging the work done for creating the bid/no-bid checklist described above, the bid/no-bid analysis matrix lists on one axis BID and NO BID as the two options or alternatives for the decision, and, on the other axis, the different criteria against which each alternative is evaluated and to which a rating is assigned.

A weight could even be assigned to each criterion, and then taken into account when counting the points.

A total score is then computed for each alternative as the summary of all the criteria ratings. Choice whether to bid can now be taken based on the option that appears to be the most appealing.

Example of a Bid/No-Bid Decision Matrix:




Weights BID NO BID

Project budget realistic 1 2 1
Project timeframe realistic 1 3 0
Resources for proposal/bid 1 3 0
Investment needed 1 1 2
Technical expertise 3 3 0
Management expertise 1 2 1
Differentiators from competitors 1 3 0
Information gathering vs. real project 1 1 2
Political considerations 3 0 3
Previous relationship 3 0 3
Project already funded 2 3 0



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But. There is a but. The decision matrix gives you only an indication. You still have to base your decision on this indicator, but the decision matrix does not tell you always the truth. Indeed, if we take the example of the bid/no-bid decision matrix above, you may make a mistake considering bidding as the best option. Indeed, it seems to be a heavy political context in this case: there is actually a good relationship between the requester and the incumbent contractor and political connections seem to enter into account in the final verdict. So it should be wise to audit, double-check the conclusion we may infer from the decision matrix to be sure it's the right one. In that particular case, since there are parameters that are totally out of our controls and tend to indicate some favoritism toward the incumbent contractor, it may not be wise not to bid unless you are willing to enter bureaucratic, even legal procedures put in place to ensure an optimal, and fair competition.

The Bid/No-Bid Analysis Matrix is also known as: bidding decision matrix, bid choice matrix, bid decision matrix, bid choice analysis matrix, bid analysis matrix, bid/no-bid decision matrix, bid/no-bid choice analysis grid, bid/no-bid choice analysis matrix, government bid decision matrix, bid/no-bid choice analysis table, bid/no-bid analysis matrix, bidding analysis matrix, tender/no-tender analysis matrix, bid/no-bid process matrix, proposal decision matrix, tender/no-tender decision matrix, bid/no-bid choice analysis method, bid/no-bid decision analysis matrix, bid matrix, bidding matrix, or bid/no-bid matrix.

Decided To Bid

You made up your mind to submit a bid, so you will send a letter of intent to express you intention to bid. Cross your fingers and wait for the phone to ring, an email message to pop, or a certified mail to be delivered to you personally.

Letter of Intent

Save time. Use your FREE template to create your own letter of intent. Use templates and samples provided in your FREE RFP Toolkit to create your own letter of intent. Usually, to be considered as valid, the letter of intent must be received no later than a date specified in the RFP, ITB, or IFB. Anyhow, it has to be received before the bid/proposal submission timeframe.

Decided Not To Bid

Save time. Use your FREE template to create your own no-bid letter. You finally, for good reasons, deemed this opportunity not so appealing. You have now no other choice but to decline the offer by sending a no-bid letter.

In the purchasing officer's perspective, receiving a no-bid letter fulfills the requirement to promote as much as possible competition. The no-bid letter demonstrates to the contracting officer that, while not interested in bidding for this particular project for specific, and valid reasons specified, you are still interested in future opportunities and want to stay in the prospective bidder list. What a courteous gesture!

Otherwise, repeated failure to bid or send an offer without sufficient justification may lead the prospective provider to be removed from the bidders list. Usually, to be considered as a valid no-bid notice, the response must be received, like proposals or bids, no later than the deadline for proposal submission.

Bid/No-Bid Form

Sometimes, the RFP sent by the requester provides the prospective provider with a submission form with a section dedicated to non-bidding suppliers in which a box "no bid" has to be checked and an explanation be specified. While you are merely required to send the form with the NO BID box checked, you still need to substantiate the reasons that led to your abstinence, which is the trickiest part. To succeed, you should better learn how to sharpen your pencil, know what to put in and how to write your no-bid letter.

The Bid/No-Bid Form is also known as: bidding decision form, bid decision form, bid analysis form, bid/no-bid decision form, bid/no-bid analysis form, bidding analysis form, tender/no-tender form, bid/no-bid decision analysis form, tender/no-tender analysis form, bid choice analysis form, bid/no-bid process form, bid form, bidding form, or bid/no-bid form.

No-Bid Letter

Save time.
Use your FREE template to create your own no-bid letter.
Use templates and samples provided in your FREE RFP Toolkit to create your own no-bid letter. Usually, to be considered as valid, the no-bid letter must be received no later than the date specified in the RFP, ITB, or IFB for submitting your bid or proposal.

How to Write Your No-Bid Letter

Zen and the Art of Saying No

Stay Zen, don't slam the door at future opportunities. Instead, do it professionally: quietly, and with a "I'll bid next time" smile. Indeed, you want to leave that same door wide open for future business.

In the case you don't really want to do business with the requester because of a redhibitory reason (they are not financial stable, so you don't want to jeopardize your own viability), you probably don't want to and shouldn't say it to them. At the same time, the last thing you want to tell is that you are not, honestly, capable of doing the job because the only knowledgeable person left your organization for, we used to say, personal reasons. Your best option is to go with the business fit of your product or services with the requirements as they are expressed in the invitation document.

Keep the door open

"I've already told you not to put your elbows on the table."
-- Your Mom.
Basic table manners say that it's not acceptable to put your elbows on the table when you're actually eating. But, unlike what people usually think, good table manners say that it's not acceptable although you're not actually eating.

So gather your forces, sharpen your mind. Do whatever it takes to be irreproachable, and keep your shirt immaculate while leaving the table. Your Mom will be proud of you, won't she.

Do your homework

Let's take a look at the 2 following sentences:

  1. "We do not want to submit a bid for the following reasons"; and
  2. "We have identified the reasons hampering us from considering a proposal submission appropriate as follows"

Should you be able to see, I should probably say feel, the difference between the aforementioned sentences, you would be able to write a tactful, effective, and positive no-bid letter in your own explaining all the reasons why you won't submit a proposition without the unconscious, negative impact of using a sequence of negative forms.

Indeed, the second sentence, unlike the first, doesn't use a negative form. Instead, a verb expressing a negative idea but in an affirmative manner, "hampering", is coupled with a positive adjective, "appropriate". Even better, instead of being negative and passive, it could be seen, or felt, as positive, active, and even proactive.

To wrap up, you have to say it almost with flowers. But what to say? To succeed, or, preferably, not to fail, you have to provide reasons that should better be valid.

Explaining Valid Reasons for No-Bid

Be very specific regarding these reasons. Not only state the reasons why no bid/proposal will be submitted, but, above all, substantiate them carefully and thoroughly.

The best professional and successful approach is to go straight to the point, in a clear, sweet, positive, even proactive, but always-tactful manner. Documenting the reasons why you decided to go with a "no bid" is far more difficult than merely deciding or feeling to do so. Spend the time needed to honestly, and properly communicate the reasons. The more specific, exhaustive, valid, and honest the reasons for not submitting a bid or proposal are, the better are your chances to:

  1. be still considered as a valid provider;
  2. not be removed from the bidders list;
  3. get back more easily to your contact should a new opportunity occur;
  4. be remembered as a professional, knowledgeable, dependable, courteous, and honest prospective provider; and
  5. above all, win the new contract, eventually.

Example of valid reasons for no bid

Valid, thus acceptable reasons not to bid ensure your organization to stay on the Bidders list for future opportunities. It's a common sense, but to be considered acceptable, reasons have to be valid. Here are examples of valid reasons for not bidding or proposing:

  • not the right fit:
    • opportunity not consistent with your organization’s business, strategic, or marketing plan;
    • opportunity not in your field of expertise;
    • project localization not in your geographic area; or
    • certain mandatory conditions are redhibitory:
      • project requirements,
      • warranties,
      • environmental and energy efficiency considerations, or
      • contract terms and conditions.
  • not the right budget:
    • requester's project budget not realistic;
    • estimation of bidding costs over your budget threshold;
    • project not profitable, negative Return on Investment (ROI); or
    • no Bid and Proposal Budget (B&P), or already allocated.
  • not the right time:
    • unrealistic project timeframe; or
    • major business reorganization.
  • not the right resources:
    • temporary lack of internal human resources (work on other projects, but don't say on other bids);
    • temporary, we expect, loss of human resources (business rationalization, or downsizing); or
    • right partners or subcontractors not available.

Don't take them for granted. Indeed, you have to customize them in order to render them valid in your always-particular context.

We've just seen how and what to say. But how to put it in writing? To succeed, or, again, not to fail, you have to lay down your thoughts in a valid format. Here comes the no-bid letter template.

No-Bid Letter Template, Sample, How to write, and Tips

To create your own no-bid letter, use the templates and samples provided in your FREE Request for Proposal Letters Toolkit.

You will also find in your FREE RFP Toolkit, amongst others, templates and samples of RFP letters, including:

  • RFP cover letter
  • proposal cover letter
  • decision matrix
  • no-bid letter
  • disqualification letter
  • rejection letter
  • non-binding letter of intent
  • decision matrix template
  • protest letter
  • letter to decline a proposal
  • contract award letter

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