Strategic Tender - Rail Freight Services

Lachlan Brown
Heavy Industry
Strategic Procurement
February 23, 2024
spend p.a addressed
key stakeholders
cost reduction p.a

Client Problem

The client had a regulatory and internal governance requirement to appoint an experienced external service provider to manage a tender process for strategic services where an internal business unit was tendering for the services.

Caliba Solution

The client had an in-house contracts and procurement team, however the industry governing body had a requirement for the client to complete an arms-length review of one of its strategic contracts to maintain the rail network. Following a competitive tender process, Caliba was appointed to manage this strategic sourcing process.

Caliba worked closely with the client’s commercial, operations, and safety teams to review and develop the scope of services and to manage the tender process. Caliba worked with operations to determine various operating models to reduce costs within this business. The tender with the new scope and various operating models was released to a list of pre-qualified contractors that had the capability and capacity to perform the services.

Caliba completed all evaluations, shortlisting, negotiations, and recommendation for award whilst reporting to the client and industry governance committees at each key project milestone.

The tender process achieved the desired outcome of confirming the competitiveness of the current contractor who was re-appointed as a result of the process. In addition, a cost saving of $4.4m per annum was achieved by testing the market on the various new operating models. Caliba then developed a contract management guide to help the client realise the savings over the term.

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