What's in this guide
- What is a government tender?
- Are you actually eligible?
- Documents you need ready before you start
- How to write a capability statement
- Using AI tools to help with the writing
- How to price your submission
- How government evaluation and scoring works
- 7 mistakes that get first-timers knocked out
- Your pre-submission checklist
What is a government tender?
When a government agency needs work done, whether at state or federal level, they are required to run a competitive process. They publish the job publicly and invite businesses to submit a formal offer. That offer is called a tender.
The agency sets a deadline, evaluates every submission against the same criteria, and awards the contract to whoever scores highest. That is not always the cheapest. It is usually the best combination of price, experience, and demonstrated capability.
Contract values range from routine maintenance jobs worth tens of thousands of dollars through to multi-million dollar fitouts for state agencies. Most small businesses and sole traders are competitive in the sub-$500k range, and new tenders are published regularly across the three main portals.
Are you actually eligible?
Most government tenders are open to any registered Australian business. You don't need to be a large company. There are a few basics that almost every tender will require:
- Active ABN, registered for GST if your turnover is over $75k/year
- Public liability insurance with cover typically ranging from $5 million to $20 million depending on the contract
- Relevant trade licences for the relevant state (electrician, plumber, builder's licence etc.)
- WorkCover / workers compensation insurance if you have employees (some tenders require it even for sole traders)
- A WHS (Work Health & Safety) policy (even a basic one-pager is sufficient for most small contract tenders)
If you tick those boxes, you can apply. There is no minimum company size requirement for most open tenders.
Documents you need ready before you start
The biggest time-waster in tender applications is scrambling for documents at the last minute. Set up a folder right now with the following and keep it updated. Every tender will ask for some combination of these:
Company / identity documents
- ABN confirmation letter from the ATO
- Business registration certificate (if applicable)
- Trade licence certificates (state-issued)
Insurance certificates
- Public liability insurance certificate of currency
- Workers compensation / WorkCover certificate
- Professional indemnity (if relevant to your trade)
Company profile documents
- Capability statement (see section 4)
- List of past projects with brief descriptions and approximate values
- 2-3 referee contacts from past clients
Policy documents
- WHS (Work Health & Safety) policy
- Equal opportunity / non-discrimination statement
- Environmental management policy (larger tenders)
The policies sound daunting but they don't have to be long. A single A4 page for each saying you're committed to the relevant standard, signed and dated, is sufficient for most small business tenders under $500k.
How to write a capability statement
A capability statement is a short document (typically 2-4 pages) that summarises your business, your services, and your track record. You write it once, keep it updated, and attach it to every tender you submit. Most agencies expect to see one.
Structure it like this:
1. Business overview (2-3 sentences)
Who you are, where you operate, how long you've been in business. Keep it factual.
2. Core services
A clean dot-point list of exactly what you do. Be specific: "residential and commercial electrical installations, switchboard upgrades, solar installations" beats "all electrical work."
3. Key projects
3-5 past jobs described in 2 sentences each: what the project was, what you did, and the approximate value or scale. Include dollar figures where you can. Evaluators use them to gauge whether you've handled work at a similar size.
Example: "Completed a full electrical fitout for a 12-unit residential development in Penrith, NSW. Scope included mains supply, switchboard installation, internal wiring, and safety inspection. Project value: approx. $85,000."
4. Licences and certifications
List all relevant licences with licence numbers. This saves them having to ask.
5. Contact details
Name, phone, email, ABN, website. Make it easy.
Getting the writing done faster
The hardest part of your first tender submission is the writing. Most tradies are better with their hands than with a keyboard, and that is fine. The good news is that most of what you write for one tender is reusable in the next.
Practical approaches that work:
- Build a template library. Write your capability statement, WHS policy, and standard tender responses once. Tweak them for each new submission. After three or four tenders, you will have answers for most common questions ready to go.
- Keep a project log. After every job, write a short summary: client, scope, value, outcome. When a tender asks for relevant experience, you pick from the log instead of writing from memory.
- Get someone to proofread. A second pair of eyes catches errors you will miss after staring at the same document for hours. This could be a colleague, partner, or AI writing tool. What matters is that the final submission is clear and error-free.
How to price your submission
Government tenders almost never ask for a single lump sum quote. They ask for a schedule of rates, which is a breakdown of your pricing by line item. This lets them compare submissions directly and apply your rates to future variations.
A schedule of rates might look like:
- Labour rate, licensed electrician (per hour)
- Labour rate, apprentice (per hour)
- Call-out fee
- Standard materials at cost + margin % or fixed markup
- Travel / mobilisation (per km or fixed allowance)
The most important thing: don't undercut yourself to win. Government agencies do not always award to the cheapest. They award to the best overall value. Pricing too low raises red flags about your ability to deliver.
Know your minimum viable hourly rate before you start. If you've never calculated this, it's: (annual expenses + desired income) / billable hours per year. That's your floor. Don't go below it regardless of how attractive the contract looks.
How government evaluation and scoring works
Most government tenders use a weighted scoring system. Each criterion has a set weighting, and evaluators score your submission against each one. The total determines who wins.
A typical weighting structure for a small works contract:
| Criterion | Example Weighting | What they're looking for |
|---|---|---|
| Price / value for money | 30-40% | Competitive rates, clear pricing, no surprises |
| Relevant experience | 25-35% | Similar jobs, similar scale, demonstrated results |
| Capability / methodology | 15-25% | How you'll approach the work, your processes |
| WHS and compliance | 10-20% | Policies, licences, insurances all in order |
| Local / SME preference | 0-10% | Some councils give weighting to local businesses |
These weightings are illustrative only and vary between agencies and contracts. The important part: price is typically less than half the score. A submission that scores well on experience and methodology can beat a cheaper option. The written response matters as much as the price.
7 mistakes that get first-timers knocked out
Government portals typically close automatically at the stated time. Late submissions are rejected. Set a calendar reminder for 48 hours before close so you have time to troubleshoot any upload issues.
Tender questions are specific. "Describe your quality assurance process" does not mean "tell us how good you are." Evaluators score against what was asked. If you don't address it directly, you score zero on that criterion.
An insurance certificate that expired last month will get your submission disqualified immediately. No review, no exceptions. Check expiry dates before every submission.
Evaluators can tell. Generic, vague answers score poorly. Tailor your capability statement and methodology response to each specific contract. It only takes 30 minutes and it makes a real difference.
When asked for references, most small operators either skip it or put down someone who doesn't know they've been listed. Contact your referees first and brief them on the contract. An unanswered referee call is a red flag.
Government tender documents are long for a reason. The scope, exclusions, and special conditions are all in there. Quoting without reading them fully leads to either underpricing (you'll be stuck with it) or overpricing on things that aren't actually in scope.
If you don't win, you're entitled to ask for feedback on your submission. Most agencies will tell you exactly what scored well and what didn't. Use that feedback to strengthen your next submission.
Your pre-submission checklist
Run through this before you hit submit on any tender:
Don't miss the tenders worth applying for
TenderMonitor watches AusTender, NSW buy.nsw, and QTenders every five minutes and sends you AI-filtered alerts when contracts matching your trade are published, and again when they're about to close.
Start Your 7-Day Free Trial