2 - Procurement and Tendering Flashcards
What are the general steps of a Tender?
- Procurement/Tender Strategy
- ITT - Invitation to Tender
- PQQ
- Collation of Tender Docs in to Form of Tender
- Issue to tenderers
- RFIs/TQs etc.
- Open tenders
- Compare and compile tender report
- Recommendation
What goes in a Form of Tender
- Preconstruction and H&S information
- Design information - specs, drawings
- Project information - people, org chart, processes
- Project requirements - programme, constraints, risks etc.
- Performance criteria
- Proposed form of contract and requirements - collateral warranties, guarantees etc.
- Pricing document/BoQ
- Tender scoring criteria
- Tender process
What is included in a tender report?
- Overview of process (audit trail)
- Credit check results
- Analysis of return against PTE
- Any levelling, amendments, omissions etc. to create a fair comparison
- Scoring against criteria
- Key issues, such as qualifications
- Overall scoring matrix
- Recommendation
What is the difference between single and two stage tendering?
Single - Client issues tender for whole project. Doesn’t get ECI, but does get a price for what they want.
Two-Stage - Client issues tender for initial stage to enter in to a PCSA in order to gain ECI for the contract later.
What does the Contractor price in the first stage of a two stage tender?
- Design and development fee
- Their fee/profit
- Proposed table of rates to be used for the main works when the prices are defined
How does the Contractor price the second stage of a two stage tender?
- In theory, based on the agreed rates under the first stage, but all might be subject to negotiation
What are the risks/benefits of a two-stage tender?
- Better buildability
- Helps develop a more viable scheme
- Certainty of costs
- Developed knowledge of the whole project team
- Programme improvement potential as better understanding of delivery requirement etc.
- Stuck with one Contractor
- Client is driven by contractor - can lose control/power over what they want
What are the risks/benefits of a single-stage tender?
- Can tender to multiple contractors
- Suitable for the traditional procurement route
- Retains control of requirements with Client
- Can take longer and cost more overall as no ECI benefit
What is Management Contracting?
- Where a party contracts subcontractors directly, and then contracts with the Client themselves.
What is Construction Management?
A client places each contract package themselves, but usually gets a consultant to help coordinate.
What are the Risk/benefits to Construction Management?
- Speed
- No main contractor overheads
- Needs lots of experience
- Price unknown until last package is let
What are the Risk/benefits to Management Contracting?
- Speed
- Reduced main contractor overheads
- Programme risk technically with the Main Contractor
- Needs lots of experience
- Price risk with Client - unknown cost until last package is let
What is the purpose of tendering?
- Auditability
- Parity
- Accountability
- Ensuring everything has been picked up
- Getting the right cost for the works
What are the three types of tender strategy?
- Single
- Two stage
- Negotiated
What is a Pre Tender Estimate?
Effectively a benchmark against which the tenders can be compared for the Client.
