4As speaks out against Tenaga Nasional for demanding 'unreasonable' RM5k tender fee

The Association of Accredited Advertising Agents of Malaysia (4As) has called out Tenaga Nasional (TNB) for being "unreasonable to demand" a non-refundable tender fee of RM5,000 per agency for its latest creative and media pitch, as part of the TNB procurement requirement for all parties that wish to submit their credentials at the request for information (RFI) stage.

In a statement to A+M, CEO Khairudin Rahim said the 4As found it odd that a tender fee be levied even for the preliminary RFI stage and on 18 October, wrote officially to TNB stating that this is an unfair requirement and appealed that the fee be waived, at least for the RFI stage.

"TNB has studied our appeal and replied the tender fee requirement shall remain. It wants to encourage serious parties to participate from the RFI stage onwards to put forward the best offer and to not waste the time of its evaluation panel. The tender fee is their way to ensure only serious parties get involved and is applied for all types of tender," Khairudin said.

He explained that if TNB is concerned about?seriousness of bids, or the ability of agencies to deliver and execute campaigns, there are other qualifying criteria that could be applied as a prerequisite. In addition, a simple review of the agencies portfolio or work, case studies, client lists, and client testimonials would also be a clear indication of their seriousness. Khairudin added that furthermore, every agency's pitch proposal is customised and complex involving hundreds of man hours and external cost in order to develop a worthy proposal that each agency is prepared to defend and uphold its effectiveness reputation.

This includes uncovering relevant consumer insights, articulation of a credible brand purpose, an inter-connected communications strategy, creative work that drives marketing effectiveness and finding ways to harness the use of people as a powerful brand medium. Each proposal includes the elusive, inspirational idea that with consistency and properly practiced creativity, can take the brand from good to great, he explained.

"We seek reassurance that an objective scoring and evaluation system will be adopted by the advertisers selection panel. Not having one raises alarm bells and triggers a withdrawal. Not giving a clear pitch brief will also trigger the same. A clear, succinct, and inspirational brief directly contributes to great work," Khairudin said.

(Read also: Why you should rethink calling for that pitch)

According to Khairudin, every decision to pitch is a serious commercial decision made by the head of the agency, as they too cannot afford to waste time in pursuit of any type of new business. This is because the time and cost the agencies laboriously spend preparing for each pitch, such as aiming for the better strategy and the better ideas, has to be carefully considered and balanced against ongoing commitments to deliver for the agencies' existing clients. Hence, by nature, the agencies are "absolutely serious" whenever they make a decision to pitch, Khairudin said.

"Agencies also value time. Agencies do not participate in pitches just to test the waters. Far, far from it!" he added. While the 4As is unable to influence a change in TNB's practice for this particular tender, Khairudin said it will re-appeal and engage with the utility company to?hopefully come to a fair resolution for future agency searches or pitches.

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