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/provide in the first stage of a two stage tender?
- Design and development fee
- OH&P
- Design process fee
- Preliminaries
- Programme
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?
- Works constructed by different works contractors who are contracted to a management contractor
- Management contractor paid on a fee basis and brought into the project early.
What is Construction Management?
A client places each contract package themselves, but usually gets a construction manager 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?
Formal written offer to carry out work
- 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.
What law governs public procurement?
Public Procurement Regulations 2023
What is the threshold for value of government works?
£5.3m, but varies for different types of works
What has replaced OJEU in the UK?
Same rules under Public Procurement Regs, but now uses FTS - Find a Tender Service?
What are the main UK Public Procurement procedures?
Open - Open to all
Restricted - Bidders can request to tender, but only selected bidders are chosen to tender
Negotiated - Direct to one supplier but only in extreme cases (urgent works, timescales can’t be complied with)
Competitive Dialogue - Speaking to multiple bidders to try and work out a solution. Not sure of your requirements.
What are the fundamental principles of public procurement?
- Value for money
- Transparency
- Public Good
- Non-discriminatory
- Fair treatment of suppliers
What did the Public Procurement Regulations 2021 change?
Mainly the thresholds for public procurement. Now it’s £5.3m rather than £4.7m.
What are the three main types of Contractor selection?
- Open
- Selective
- Single/Negotiated
Finder Tender Service
- Portal facilitates contractor selection depending on what you are procuring.
- Thresh hold if over the 5.3m amount
What is procurement?
The act of obtaining goods and services
What are Employers Requirements?
A document setting out the requirements from the employer for the project. This can be performance specifications and drawings.
- Design specs
- Payment schedule
- Brief
- Sections of work and phasing
- CSA
- Insurances
What is tendering?
The process in which the employer invites contractors or consultants to bid for a project / work.
What is OJEU?
Official Journal of the European Union
An online portal that houses public sector contracts over the procurement threshold.
What happens if you notice a mistake in the tender?
The tenderer should be given the details of the error and afforded the opportunity of confirming or withdrawing their tender.
How would you deal with front loading of a tender?
Request they remove the front loading and it may provide grounds for disqualification.
What is the CSA?
Breaks down a contractors price into a form where it can be compared to other tenderers. It can then be used as a base to calculate payments
What is a cost-remeasurement contract?
Where the amount paid for the work carried out is based on the remeasurement of work after it has been carried out, usually against a schedule of rates contained in the contract
What is a cost-reimbursable contract?
The contractor is reimbursed the direct costs that they incur with an additional fee
What is a lump-sum contract?
Where the contract sum is known before work starts on site and the contractor agrees to undertake a defined amount of work for a specific amount
What is a measurement contract?
Same as a re-measurement contract
How do Stace bid for a job?
- Suitable skill / expertise
- Conflict of interest
- CV match requirements
- Fee proposal document
- FRS
What is Serial Tendering?
- Involves preparations of tenders based on typical schedule of works.
- Good for similar projects and encourages people to put in low rates as repeat work
What did the Public Procurement Regulations 2023 change?
- If unable to value a contract it will be valued at the relevant threshold to trigger compliance with the PCR
- Contracts cannot be terminated in a way that “circumvents” the procurement rules under the PCR
- Cannot use Prior Information Notice as a call for competition
How does public procurement work?
- Value of contract depends whether it is subject to the full regs
- Advertising to FTS
- Preliminary consultation to understand scope etc
- Tender strategies
- Time limits
- Evaluation criteria
Public Procurement below the threshold?
- Central Government £10k
- Sub-central Government £25k
Anything above needs to go to Contracts Finder. Under can be given to whoever.
