Small workshops like the tender system

A few months ago, I visited the small workshops in Ang Mo Kio autocenter. They participated actively in the tender system.

They welcomed me warmly. They were proud to be participating in the tender system. They should me their quality control and other business process.

I wondered? Why did they like the tender system? They had to submit a competitive bid to be awarded.

A market expert told me a few days ago. In the past, the small workshops had to pay a large finder's fee of a few hundred dollars to the tout (usually the tow truck operator) who bring the repair job to them. Sometimes, the tout approach several workshops to see who can give the best fee to them.

After paying the fee to the tout, the workshop has to jack up the repair bill to cover his cost.

By participating in the tender system, the small workshops do not have to go through this hassle. They work out their cost and a fair margin, and submit the tender. By being competitive, they can get a fair allocation of work and make a reasonable margin.