, Britain
In March 2015 a bid team in Birmingham sat down with the invitation to tender for a franchise they were already running. The contract they held had two years left on it. The competition for the years after that was open, and the financial submission was due long before anybody would know whether it had worked.
Everything on the table was a forecast. How many people would travel in 2021. What they would pay. How much of the network would be available on a Sunday in year four. What the Department for Transport would treat as a committed payment rather than a hopeful one.
The awkward part was that the most credible figures in the room were the incumbent's own, and the incumbent was them.
The competition was won on money and on promises
By the 2010s most franchises were let by the Department for Transport, which pre-qualified bidders, issued an invitation to tender, and then evaluated submissions running to many volumes: the train service specification, rolling stock, stations, staffing, marketing, and the financial offer.
The financial offer was the part with a number in it. Depending on the route, a franchise either paid a premium to government or drew a subsidy from it, and the bid committed the operator to a schedule of those payments across the whole term.
A committed premium is a fixed obligation. It does not fall when passenger numbers fall. It is payable in year six on the strength of a forecast written in year zero, and the only thing that changes between the two is everything.
The quality half of the submission was not the soft half. Service frequencies, journey times, station investment, platform staffing and performance commitments all scored, and every one of them went into the agreement afterwards as a cost. Nothing in a winning bid stays a presentation slide.
The incumbent is bidding against its own numbers
An incumbent bidding for its own franchise has better information than anybody else in the competition and that is not the advantage it sounds like.
It knows the real revenue by flow, the real cost of a driver hour including overtime and rest day working, the real absence rate, the real condition of the fleet, and how much of last year's punctuality figure was luck. A challenger builds its model from published data, from advisers who have worked on other bids, and from the assumption that a new management team will do better than the people currently doing it.
So the incumbent arrives at the deadline holding a forecast it believes. To win, it has to bid past that forecast, because somebody else will. The internal argument is never about whether the stretch is achievable. It is about whether losing the business outright is worse than winning it on terms that will be uncomfortable in year five.
Losing is not a quiet outcome either. A franchise is the whole operating business: the depots, the drivers, the revenue, the name on the side of the train. When it transfers, the staff transfer with it and the loser is left with overheads and nothing to put through them.
Most of what you promised was never yours to deliver
Network Rail owns and operates the track, the signalling and the largest stations. An operator buys access rights, approved by the Office of Rail and Road, and it can only buy paths that physically exist. A bid promising a faster journey time or an extra service every hour is usually promising something that depends on work being carried out by somebody else, on a programme the bidder does not control and cannot accelerate.
Punctuality works the same way. The performance commitments in a bid are promises about a railway the bidder shares with everybody else running on it, and much of what will go wrong across eight years will not happen at the operator's end of it.
Rolling stock sits with leasing companies. New trains take years, then approvals, then driver training, then depot alterations. A bid promising new trains in year three is a bid about a factory in another country and an approvals process nobody in the room can influence.
Bidding costs millions and most of it is written off
A franchise bid occupied a team for a year or more: operations planners, revenue modellers, lawyers, rolling stock specialists, bid writers and external advisers. The cost ran into millions of pounds for each bidder, spent before anybody knew the result, and written off entirely by everybody who did not win.
The competition carried its own risk on top of that. In October 2012 the Department for Transport cancelled the InterCity West Coast competition after finding flaws in its own evaluation, agreed to reimburse bidders' costs, and paused the franchising programme while reviews were carried out. Competitions restarted afterwards on a published timetable. Bidders had already learned that a year of work could end for reasons on the other side of the table.
A winning bidder also had to stand behind its promise. Franchise agreements required parent company support and bonds, so the offer was only as good as the balance sheet behind it.
A promise made in a bid room has a very long tail
The contract starts a year or two after the submission and then runs for the better part of a decade. The people who have to deliver year six are rarely the people who wrote it.
What goes wrong is ordinary. Passenger growth slows. A recession arrives. Commuting patterns change. An enhancement scheme slips two years to the right. None of that reduces the committed payments. Some agreements included arrangements for sharing revenue risk with government, and how far they went varied between contracts and got narrower as the decade went on.
When an operator could no longer carry the terms, the outcomes were a renegotiation, an early exit, or the contract passing to a publicly owned operator of last resort, which is what happened more than once on the East Coast route. The model itself did not survive 2020: franchise agreements were replaced by emergency arrangements and then by management contracts, under which the government took the revenue risk and paid the operator a fee for running the trains.
Where this shows up in the game
The Bid puts you in charge of a train operator in Birmingham in March 2015, with two years left on the contract you hold and the competition for the next one already open. It runs for two years of game time, it is marked Hard, and it hands you no extra handicap beyond the situation itself.
The bid is a single decision in month nine, with three options: hold, stretch, or win at any cost. Each one sets the premium payments and the service commitments you then have to live inside for the rest of the run, while the existing contract continues underneath you with the punctuality figure still counting against you. The trap is the one the real competitions had. A cheap bid wins, and then it has to be delivered, and the run is long enough for you to find out what you agreed to. You are scored on whether the company is still trading at the end of the two years, and the page for The Bid sets out the starting figures and the rules in full.
The seed is fixed at 600016, so everybody who attempts it meets the same Britain, the same demand and the same competition, which is what makes the scores comparable. It runs under ironman rules: one save, and what happens happens.