Visits to the Client when Competing for New Consulting Projects
Applied Economics, Vol. 35(14), 1531-41, 2003
22 Pages Posted: 22 Jul 2020
Date Written: June 21, 2002
Consulting firms (CFs) sell services on a project basis to many clients and must therefore continuously tender for new contracts. One frequently used strategy by CFs is to visit the clients in connection to the tenders. The reasons to the visits are: (1) to influence the client in his decision-making (e.g., marketing, bribing); and/or (2) to source information about the project so that a better proposal can be submitted. Using a unique database on individual export proposals submitted to emerging markets, which of these two reasons is the most important is examined empirically. The estimations show that influencing the client dominates as explanation to the visits. Although it is not possible to determine whether this influence takes the form of bribing or marketing, all conditions necessary for bribes to occur are fulfilled.
Keywords: Consulting firms, tenders, bribing, contracts. bargaining
JEL Classification: F14, L84
Suggested Citation: Suggested Citation