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tender pdf

tender pdf

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tender pdf

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  1. CONTENTS Introduction ofTendering Principles ofTendering Types ofTendering TenderingProcess Tender Documents

  2. 1. INTRODUCTION The construction industry in both developed and developing countries may be viewed as that sector of the economics which, through planning, design, construction maintain, repair and operation, transform various resources into constructed facilities. The types of public and private facilities produced range from residential and non- residential buildings to heavy construction, and also these physical facilities play a critical and highly visible role in the process of development. For this type of construction projects, mainly, there are three group are participated. They are client, consultant and contractor. Under this people, there are lots of stake holders; people who are connected with the project directly or indirectly areworking. On the construction activities, crores of rupees are spent. Therefore, money is the main factor of a construction project. Therefore, the client is looking for a select a best, suitable and cheapener contractor for his works. For that, the acceptable and best method is tendering method. Tendering is the formal, documental, structural process, where the tender undertake to enter into a formal agreement with the client. There are lot of things we have to understand about tendering. If we are going to work with tendering process, we must have a better knowledge about tendering system. If not, we will fail with the project, and also as a company and as quantity surveyor. Therefore, we found lots of information about this topic and we got helps from internet and also books like book of tendering printed by ICTAD. We would like to thanks Mr. Piumal Amarasinghe, Lecturer in Quantity Surveying Practice for his advices. We did a presentation before and this is the report of it. We make this report clearly as we can to understand get knowledge about tendering to anyone who readthis.

  3. TENDERING • WHAT ISTENDER? • DEFINITION • Tendering is the process of choosing the best and cheapest company to supply goods and services by asking several companies to make offers for supplying the goods and services. • Tender is an offer which incorporates the sum of money, time and other conditions required to carry out the contract obligations in order to complete a project or a part of it consisting of specifiedworks.

  4. 2. PRINCIPLES OFTENDERING • The purpose of these principles for Tendering is to provide a framework for the effective, consistent and efficient management of tendering practices throughout any construction project. The principles set out in this document can be equally applied to anyindustryinvolvingthedeliveryofanewproductorservice.Successfulprojectshave generally started with the use of best practice tenderingprocesses. • These are the basic principles of tenderingprocess, • All aspects of the tendering process must be conducted with honestly at all levels of the industry. • A clear understanding of the rights and obligations of bothparties. • Parties must confirm to all legalobligations. • Parties must clearly identifyownership. • Parties must not submit tenders without a firmgoal. • Parties must not engage in any practice which gives improperadvantage. • Condition of tendering must be the same for tender on any particularproject. • Clients must clearly specify their requirements in the tender document and indicate criteria forevaluation. • All the information provided in the course of tendering must beprotect.

  5. 3. TYPES OFTENDERING • The majority builders still obtain much of their work by system of tendering. There are three principle method of choosing a contractor. Theyare, • OpenTendering • Selective Tendering • NegotiatedTendering • 1. OpenTendering • This usually takes the form of an advertisements in a national or local newspapers inviting contractors to apply for tendering competition for carrying out the work. The main characteristic of which are given usually the deposit is required in order to discourage frivolous applications. The deposit is returnable on submission of a tender. In this method allows any contractor to submit a tender to an advertised project. • Process • Client advertises openly in the press or the trade publications inviting contractors to apply for theproject • Contractor that is able to undertake the project would request a tender document • After receiving the tender from the architect, the contractor maybe • required to give a deposit and to ensure a bona fide tender. This is done to filter out the contractors who are not interested in submitting atender. • Advantages • Keep competition from large number ofapplicant. • Possibility to get competitiveprice. • No chance forfavourism. • Provide opportunities to new comers, unknown contractors to enter to the market. • Disadvantages • Time and cost taken to review the large number ofapplicant. • The cost of tendering accumulated to the industry and general cost to the industry ishigh. • Difficult to evaluate and select best one from wide range ofapplicant.

  6. SelectiveTendering • Contractor apply to be included on an approved list maintain by an employing body often an architectural practice, local authority or statutory body. These organizations have extensive knowledge and experience of individual contractors and regularly review contractor performs and approval list from such list. There are able to select contractors most suited to the contract the number invited will according to the value of thecontract. • Note • Compile a list of preferred builders for theproject. • Based on builders established skill. Reliability and proven competence for the type of workgiven. • Each contractor is bend ask to provide atender. • Advantages • Cost of tendering isreduced. • Time consuming for the tender evaluation isreduced. • Allow only capable and approved firms are to betender. • Provide limited competition and easy to screen andselect. • Disadvantages • Let’s competition forces high tendersum. • Opportunities for collusion among competitors and mislead thetime. • Mis opportunities. ( newcomers) • Industry complain those who have not shortlisted.

  7. Negotiated Tendering • In this process only well reputed contractors are been negotiated by inviting them to submit their tenders. Client can contractors determine the perimeters for negotiation before commencement of the project. The maintenance of positive relationship during the negotiation process in essential. • Why client went tonegotiate? • Businessrelationship • Contractor, finance project ( client find difficult to finance then negotiate with the builders who is willing to finance theproject) • Continuation ofcontract • Special circumstances ( only one contractor available to work) • Special expertise of equipment • Wish to take advantages of the builder’s specialized knowledge at the designstage. • To have quickstart • Advantages • Expected quality and functions can be achievemore. • Speed up the entireproject. • The project objective and definition may be managed. (builders involvement of the designstage) • Disadvantages • Non-competition forces for high tendersum. • Less formality make course more contract administrationinquiries. • Lackaccountability.

  8. 4. TENDERINGPROCESS Tendering process can be divided in to six stages. These stages are shown in below picture. Stage2: APPROVAL TOTENDER Stage1: PREPARATION Stage3: DOCUMENTATION Stage6: AWARD CONTRACT Stage5: PROCESSING Stage4: INVITATION • Stage 1:Preparation • Final completion of drawings, specification, measurement / take-offprocess. • Choose conditions of contract. • Parties involved: architect, engineers, QS, client, projectmanager • Stage 2: Approval totender • Discussion and decision on type of tender to beused. • Selection oftender: • Open • Selective • Negotiate • Parties involved: client, consultant, projectmanager.

  9. STAGE 3: TENDERDOCUMENTATION • Letter of invitation totender • Letter ofacceptance • Bills ofquantities • Relevantdrawings • Schedule ofrates • Stage 4:Invitation • Based on selection of tenderingmethods • Open / competitive / bid tender – produce tendernotice • Selective – shot listed contractors will be invited to tender if theywish • Negotiated – only one contractor is approached- direct entry toproject • Stage 5:Processing • Received tender submitted by contractor • Tender assessment /evaluation • Completed tenders arereceived • Arithmeticalcheck • Reasonable tendersum • Reasonable completiontime • Capabilities of tenderers underconsiderations • Tender recommendation / report – tenderboard • Stage 6: Awardcontract • Pre-award meeting with contractors – validation of lowest complyingbid • Validate lowest bid - Pre-contract meeting with contractor for contractsigning • Approval by tender board / treasury (tender exceeds RM10 mill.) – an acceptance of tender form is issued to tenderer , signed by the authorizedofficer

  10. TENDER DOCUMENTS • Tender documents are prepared to seek tenders(offers). • Also tender document help to maintain & protect the relationship between client & contractor. • Documents oftender • Invitation forbid • Instruction tobidder • Standardforms • Condition ofcontract • Form oftender • Biddingdata • Contractdata • Specifications / general andspecial • Bills of quantities (BOQ) with pricingpreambles • Drawings • Schedules of additionalinformation • Sample copy of letter ofacceptance • Sample copy of bank guarantee for performancebond • Schedule of day workrates • Sample copy of bank guarantee for advancepayment • Subsoil investigationreport • Special/particularspecifications • Notice to Tenderers • This document contains a Project Summary, a listing of Tender Documents, key dates, validity period, contact details, number of copies required and details of tender submission location andtiming. • Conditions ofTendering • This document details the overall Tender Process including the Delivery Method, Probity issues, Communication issues, the Criteria for Selection and the EvaluationProcess.

  11. Tender Form &Schedules These documents request specific information from the Tenderers concerning the works. For example, Tenders are generally required to provide an overall cost, a breakdown of this cost, a program, details of manpower, plant and equipment, personnel, subcontractors and methodologies. The Tender Form is a formal statement of the Tenderer’s offer to supply services in accordance with the TenderDocuments. Conditions of Contract This document contains the General Conditions of Contract which sets out the contractual basis for carrying out the works. In addition, the Special Conditions are sometimes included which are unique to the client and/orproject. Specification Depending on the type of Delivery Method chosen, this document may be a Project Brief or a detailed Specification of the works. These documents set out the performance and technical criteria for theproject. Drawings The number and standard of drawingsprovided. The main tender document –BOQ

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