European Business Opportunities

Firstly, an apology. We've been very busy and have neglected to update this blog recently. Anyway, we are back now and have some great business-focussed posts lined up for the coming weeks. Thanks for your patience and we hope you continue to read the blog and leave comments.

Today's post is on fleet car leasing - an increasingly important aspect of business management across the EU. Ensuring that your fleet cars are opertaing in a fully optimal manner to your business needs is vital. With this in mind, we have ben reading a recent study from UK based fleet car leasing company, Fleet Alliance detailing the most popular models amongst its fleet clients (they manage over 10,000 vehicles). The results affirm that there is one clear leader  in the fleet market, Audi.

Audi cars came out on top of the survey, taking over 19% of the total fleet cars leased. The MD of Fleet Alliance, Martin Brown commented that "Audi’s .......... success down to the user chooser element amongst Fleet Alliance customers, particularly at the SME end of the fleet market."  VW took second spot at 15.8%, whilst Ford were third with 15% of cars leased.

Here is the full breakdown of top fleet manufacturers:

Manufacturer %

Audi 19.1

Volkswagen 15.8

Ford 15.0

Vauxhall 9.7

BMW 8.6

Skoda 4.8

Nissan 3.0

Mercedes 2.8

Kia 2.5

Volvo 2.3

In terms of individual car models - Audi again ruled the roost - with the 3-door A3 being attractive to fleet lease, followed by the VW Golf and the Vauxhall Insignia.

Top 10 Models

Model %

Audi A3 7.9

VW Golf 6.5

VH Insignia 5.6

Ford Fiesta 5.6

VW Passat 5.3

Ford Mondeo 4.8

Audi A4 4.6

VH Astra 2.9

Skoda Octavia 2.9

BMW 3-Series 2.8

Overall, this is an interesting report from Fleet Alliance - will Audi be able to retain its top spot in the years ahead? Do you own an Audi or operate a fleet of Audi cars? If so, why are they leading the pack? We welcome your opinions.

With such a huge variety of tendering opportunities within the European Union that businesses can be forgiven for trying to go for very tender that they feel may be obtainable, no matter how vaguely it may be related to your business areas of knowledge. This however is quite probably the wrong approach to take in most cases.

Realistically, there are some serious questions that your business should ask of itself before entering the bid process for tenders:

• Do we know who is making the decision for this tender?
• Does our business have a relationship with this person?
• Do we have a unique business advantage that could push us ahead of other bidders?
• Does we have the capabilities to see this tender process through?
• Is pursuing this tender a sensible use of our business time?
• Do we have a realistic chance of winning this tender?
• Will winning this tender provide a platform with which to build upon in the future?

These are amongst some of the queries that a business should consider before becoming involved in a tendering process, as it can be an expensive and long term process.

The importance of the construction sector to the UK economy is underlined by basic statistics: there are 1.5 million people employed in construction - and it makes up roughly 10% of the UK’s Gross Domestic Product. However, as the construction sector is investment led, it can suffer particularly hard in times of economic decline.

The recessions of the mid 1980s and early 1990s had a severe effect on the sector, only for it to bounce back in the late 1990s with changing government policy (Private Finance Initiative funded investment) – which led to a comprehensive programme of building in the educational, health and transport sectors. So, the unprecedented economic troubles of the last two years have presented yet another obstacle for the sector to overcome – this time things are a little different though, there has been very little good news for the sector in three years and the fall in activity has been the sharpest in 35 years.

Bad news from the CBA report:

• A 3% decline in construction activity during 2010 (last year dropped 12%)
• 2011 until any growth is expected, with only 1% a year in 2011, 2012 and 2013
• Since November 2008, private sector construction fell by almost 20% (a further fall of 4% is anticipated during 2010)

Positive news from the report:

• A growth of 32% in private house building expected between 2010 and 2012
• A boost from infrastructure work in the regulated sectors of rail, water and energy sectors
• Olympic Park construction is well underway and some of the Olympic Village is now complete
• £100m prison in East Dunbartonshire
• Barbour ABI report that the number of roads projects in 2010 has remained broadly flat compared to 2009, the value of these projects has increased fourfold
• Meanwhile, work on the £16bn Crossrail project continues and £1.1bn was announced for electrification of the Liverpool-Manchester line.

This is the question that has been posed by many in the business and political spheres of Europe (including the UK Conservative Party), who are unconvinced that the Official Journal of the European Union (OJEU) is the best solution for alterting businesses to tenders that are on offer throughout the EU. The OJEU is published every working day in 20 languages, renedering it an extremely complex and difficult to manage document - there are three principal issues with the OJEU which it is argued need to be addressed:

• High volume of tenders available - Due to the sheer volume of opportunities on offer, it can be difficult to locate those tenders which directly relate to your business needs and capabilities.
• Inefficient categorisation - Many services and sectors overlap, therefore it can be difficult to locate individual categories within the journal that you may wish to focus on.
• Problems with translation - Most OJEU notices are submitted in the language of the country where the tenders have originated in. The service which is used to translate these tenders is automated directly from the source language. This can led to confusion over the exact nature of the opportunities on offer.

What are your opinions on the OJEU process? does it need full scale reform in order to become more business-friendly? or does the system work fine for you at the moment?

Particularly in these economic times, it is becoming imperative to spread the profile of your business into areas that you would not normally think of. If you are actively seeking out contract opportunities it can be useful to look outwith your normal geographical boundaries  - there are perhaps many more opportunities out there than you think. Within the European Union (EU) there are 27 member states with a combined population of almost 500 million people, generating 30% of the gross worlds product. This means that there are a great deal of tenders out there waiting to be claimed.

Established by the 1993 Maastricht Treaty, the EU was built upon the foundations of the European Community.

We thought that it would be useful to list the member states of the EU at present, together with their time of joining and whether they have adopted the Euro currency.

    * Austria - Member since 1995 (Euro currency)

    * Belgium - Pre-existing member (Euro Currency)

    * Bulgaria - Member since 2007

    * Cyprus (Greek) - Member since 2004 (Euro currency)

    * Czech Republic -  Member since 2004

    * Denmark - Pre-existing member

    * Estonia - Member since 2004

    * Finland - Member since 1995  (Euro currency)

    * France - Pre-existing member (Euro Currency)

    * Germany -Pre-existing member (Euro Currency)

    * Greece - Pre-existing member (Euro Currency)

    * Hungary - Member since 2004

    * Ireland - Pre-existing member (Euro Currency)

    * Italy - Pre-existing member (Euro Currency)

    * Latvia - Member since 2004

    * Lithuania - Member since 2004

    * Luxembourg - Pre-existing member (Euro Currency)

    * Malta - Member since 2004 (Euro currency)

    * Netherlands - Pre-existing member (Euro Currency)

    * Poland - Member since 2004

    * Portugal - Pre-existing member (Euro Currency)

    * Romania - Member since 2007

    * Slovakia - Member since 2004 (Euro currency)

    * Slovenia - Member since 2004 (Euro currency)

    * Spain - Pre-existing member (Euro Currency)

    * Sweden - Member since 1995

    * United Kingdom of Great Britain and Northern Ireland - Pre-existing member

If you are new to the tendering process, at times it can seem like entire speech pattern of the tendering process is based upon abbreviations. For all but the most experienced procurement managers this can make applying for tenders an even more difficult task than it already is. Fortunately, there are a number of excellent online resources that we can refer to which can help us out. Instead of us copying directly from these pages (like some blogs are guilty of), we thought that we would link to some of our favourites:

* Tenders Direct Blog - One of the leading tendering websites has a blog, this post has a nice glossary

* Defence procurement Tony Zemaitis Glossary, includes a handy PDF file

* OJEU - The official site of the OJEU

* Tenders Electronic Daily

These are a few pages that we refer to often when we are struggling with terminology.

If there are any other concise tendering glossaries that you fell would be of use then please point us in the right direction! - Thanks for your input.

The rather dull language used in much legal documentation can make it a bit of a chore for for alot of businesses to get a full understanding of the process involved. We thought that it would be useful to have a look at the process which defines these thresholds and what the current thresholds are.

What is a threshold?

Firstly, we have consulted various online sources to define - Threshold:

The place or point of beginning; the outset.

Obviously, when tendering for contracts,  it is the financial aspect of the threshold which we are concerned with. Procurement directives from the European Union stipulate that when a contract value reaches a certain level - public sector organisations, as well as private companies operating in the water, energy, transport and postal services (the 'Utilities' sector), have to publish OJEU Notices advertising that the tendering for a particular contract is open for applications.

The calculations of these thresholds are taken from a combination of many different bodies around the world. The OJEU thresholds are updated every two years in line with World Trade Organisation (WTO) act known as the Government Procurement Agreement - GPA). European legislation sets out the thresholds in Euro currency, the GPA defines them in the form of something known as Special Drawing Rights (SDRs). SDRs are an asset established by the International Monetary Fund (IMF).  SDR value fluctuates on a daily basis and is based on the relative values of the Euro, Sterling, Japanese yen, and the US dollar. The bi-annual updates to the EU thresholds factor in relative movement between the SDR and the Euro. Obviously for those outwith the Euro currency (for example the UK) there has to be a further amendments to these figures in order to bring them into line with the new threshold levels.

2010 - 2012 EU tenders thresholds?

Public contracts from January 2010

Utilities contract thresholds from January 2010

There are exceptions to these thresholds, each of the following have a threshold of £156,442 (€193,000).

Hopefully these thresholds have provided you with some useful information.

UEFA, the governing body for association Football in Europe, announced yesterday [Tue 19th Jan 2010], that it was opening up to tender the Media rights for the Extra-European Market, for their forthcoming Euro 2012 Tournament in Poland & Ukraine.

In order to do this uefa have split the rest of the world into several territories, and invited media companies to submit, offers, and expressions of interest for the distribution and exploitation of these rights.

The deadline for expressions of interest is the 27th January, and from that point the formal tender process will be launched in due course, it is expected to be fiercely contested.

Only qualified media agencies, with the correct experience of broadcasting major sporting events have been requested to reply.

Discussions between European Union and Indian negotiators continue in Delhi today [Monday 18th Jan]. Whilst the two sides have been closing on most of their respective differences, the largest problem is that of India's reluctance to open up her borders to European competition for public procurement.

This and difference in attitude to child labour, and Climate change policies, are nearly keeping the two sides apart in this possibly mutually beneficial bilateral trade pact.

However, the opening up of India to European Competition is hugely important, when the size of the indian public sector is considered, this and the fact that the Indian defence sector is set to become the third largest in the world after China and the US within the next five years.

India is already one of the European Unions largest single trading partners, but the hoped for agreement is expected to raise gross trade between the two parties to about £150 billion by 2015.

European Institutions

The European Commission

The European Council

The European Ombudsman

The European Parliament

  Facts on the European Parliament

  Info on the UKs relation with the Parliament

The European Court of Justice

Other Useful Sites

Euroguide

Know Europe