Winning a public tender for vision systems
Analysis of historical competitor bids allowed us to propose a price 4.2% higher than assumed, which was still victorious.
Vision-Tech Polska entered a tender for the supply of quality control systems worth nearly 2 million PLN. We used game theory to calculate an offer that won without unnecessary margin cutting.
The challenge
In 2023, the client lost three important bids, each by less than 0.8% of value. Their previous method was a simple 11% markup on production costs, which was too predictable for aggressive rivals from Warsaw. In this specific proceeding, a contract for 1.8 million PLN was on the table, with 4 other bidders involved, including two very strong players. They lacked hard data on how the others would realistically behave, causing them to fear either too high a price (wasted time) or too low (ruined profit).
Our approach
Our three-person team analyzed 14 archived tenders from the same ordering party between 2021-2023. We focused on behavior patterns of the two main competitors. We used mathematical models to check 12 different variants of their reaction to market price. Darek Nowakowski supervised the creation of a payoff matrix, which showed the most dangerous rival usually targets a safe middle ground rather than the lowest possible rate. This allowed us to stop guessing and start calculating.
The solution
We delivered a precise price recommendation based on probability calculus. Instead of proposing 1.76 million PLN, as their sales department originally planned, we indicated 1,842,500 PLN. The Konsens Logika model showed that at this price, the chance of winning was 63%, while maintaining an operating margin of 16.3%. The client received a concrete calculation sheet from us justifying every złoty in the offer and providing confidence before sending documents.
Results
The tender ended in complete success and the signing of the agreement. Our forecast proved correct almost to the penny – the second offer in the set was more expensive by just 14,300 PLN, confirming we hit the market gap perfectly.
Timeline
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January 2, 2024Data collection on 14 historical tenders of the ordering party.
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January 11, 2024Completion of the mathematical model building and variant testing.
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January 19, 2024Submission of the final price recommendation and bid filing.
"I feared that raising the price by over 4% would sink us. However, mathematics did not lie and we won by a hair, while keeping a solid profit that mattered to us."