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How to outwit the cunning and not get involved in an adventure: a case about how a company from Great Britain chose a tender executor.

By participating in tenders, the customer undertakes several risks: the contractor failing to fulfil their obligations, cooperation with unskilled specialists, and litigation (if the contractor does not fulfill the terms of the contract). All these risks, however, appear after the contract has been signed.

In this particular case, a company from East Yorkshire demonstrated how to avoid problems prior to signing the contract and how to prevent cooperation with scammers.

The source data

Company Information: An agricultural holding company from East Yorkshire which specializes in the production of agricultural products and food. The company is engaged in poultry, meat processing, and crop production. It also produces animal feed and specializes in wholesale and retail.

Problem: The management of the agricultural holding decided to build another warehouse for storing finished products. They decided to choose a contractor through a tender. They had four candidates. The first contractor requested 3.36 million for his services, the second 2.8 million, the third and the fourth asked for 2.4 and 1.9 million respectively.

The managers of the agricultural holding found the fourth company’s offer to be suspiciously cheap (compared to the other candidates). On the other hand, the first option was too expensive. Therefore, they had to choose between the second and the third bidders.

Objective: Secure the contract, find decent contractors.

Task: Verify potential contractors.

What did we do?

  1. Checked licenses and building permits. We found no problems with this as both companies had relevant documents and valid licenses.
  2. Analyzed registration data. Company A (which offered 2.8 million) was registered on March 18, 2012. The name of the organization and other details coincided with the data that company representatives provided for the tender.

    The legal address coincided with their actual location.

    Company B was registered later, on May 25, 2018. However, this fact wasn’t suspicious at that point because the company had already won several tenders. The company was positioned to the management of the agricultural holding as a young and ambitious organization that had already been able to make itself known.

  3. We studied who the bidders worked with. Both private and public companies were among the clients of Organization B. It had credibility. Only private firms were among the clients of Company A, but some of them cooperated with the contractor more than once.

    The customer company also drew attention to the fact that candidates repeatedly participated in tenders.

  4. Affiliation verification. We studied the relationships of the potential contractors and compared them with the tenders they had won. The analysis found a match between the representative of Company A and one of the customers of the tender. This confirmed the fact of affiliation. The management of the agricultural holding became suspicious and decided to follow through with the verification.
  5. Owners verification. There, the first surprise was waiting for the top managers of the agricultural holding: the head of Company A was listed as the owner of seven other organizations. Company B, which was participating in the tender, was one of them.

The verification wasn’t finished yet. The management of the agricultural holding decided to study the information about the company that bidded 3.36 million for the project.

The date of registration immediately caught their eyes. The company appeared two weeks before the tender. Naturally, it had no clients, so it was difficult to speak about how serious this candidate was. Having put all these factors together, the theory appeared: the first company’s offer was fake which would make the management of the agricultural holding choose an executor between two companies with the same owner and a third independent participant. This approach would increase the chances of winning the tender.

In order to expose them, the top management of the agricultural holding decided to pay further attention to how Companies A and B fulfilled their obligations before their customers. While there were no complaints regarding the second organization, Company A had a few lawsuits. Subject of the dispute was violation of the terms of the contract during construction works with the company’s previous customer as the claimant.


The management of the agricultural holding refused to cooperate with either Company A or B. Even though Company A has already been operating on the market for 6 years, an unfair approach even before actual cooperation cannot say anything good about the company. Moreover, several lawsuits were filed against the company by dissatisfied customers.

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