Procurement And Tendering Flashcards
What are the 4 main procurement routes
Design and build
Traditional
Construction Management
Management Contracting
Name 7 tender routes
Open
Selective
Staged (single and two)
Framework agreement
Negotiated
Serial
Public
What’s the difference between tendering and procurement
Procurement is the overall act of obtaining goods and services
Tendering is an important phase in the procurement strategy
What are the tender documents
Invitation to tender
Form of tender
Contract conditions
Instructions to tender
Project info
Design info
Pre- construction info
Tender query form
Pricing doc
Appendices
What is the form of tender
The form that the contractor signs and returns with their proposed tender, in terms of price and programme.
What’s the instructions to tenderers document
Sets out what is expected to be returned by the contractor and by what date.
Also sets out scoring mechanisms, questionnaires and who to direct queries to
What pricing doc is used for a design and build procurement route
Contract sum analysis
What are the two ways of issuing tenders
Traditional
E tendering
What are the pros of e tendering
Reduction of paper and printing costs
Can track the time of tender opening
Collates tender queries in one place
Should tender queries be answered back to all tendering contractors?
Yes
When is serial tendering used
Often on large projects with a number of phases
How does serial tendering work
The first phase is tendered on a competitive basis which serves as a framework to negotiate the following phases
What’s the advantage of serial tendering
The client knows the contractor was selected in a competitive environment for the first phase and so the follow on negotiated tender should be sound
What’s the negatives of serial tendering
As time goes on the basis of the original tender won’t be applicable and will need to be renegotiated anyway
How do firms apply to be on a framework
Open tenders are advertised for them to apply
Who can be selected once the framework list is agreed
Only companies on the framework approved list
What are the pros of frameworks/ approved supplier lists
Reduce procurement costs for large numbers of contracts for similar work
Confidence in all contractors on the list
What is open tendering
A tender process which allows anyone to express and interest to tender
What’s selective tendering
A shortlist drawn up by the project team/ client or drawn from a pre agreed framework/ approved suppliers list
What’s negotiated tender
A contractor is selected and then negotiating begins
What’s included in an invitation to tender
A formal invitation to tender
Project description
The return date
Contact detail for queries
What does PCSA stand for
Pre construction services agreement
What are the negatives of two stage tendering
The contractor can be ingrained in the project and negotiate a higher price
If the contractors price for the second stage is too high you have to re tender
What are the main factors which might influence the selection of a procurement route
Time
Quality
Cost
What does the construction manager do
Manages the contract works
Who are the trade contractors contracted to on a Construction management procurement route
Client
Who are the subcontractors contracted by on a management contract
Management contractor
Name the pros and cons of traditional procurement in terms of quality cost and time
Pros
Cost - Higher cost certainty as design is complete pre tender
Quality - Design is fully developed before tendering and client retains design control
Cons
Time - Design needs to be fully developed before tendering
What are the pros and cons of Design and build procurement (time, quality, cost)
Pros
Time - Overlap of design and construction
Cost - Contractor generally takes the financial risk for an agreed price. Early involvement in design can lead to value engineering.
Cons
Quality - Cheapest route to meet spec can lead to low quality
What are the pros and cons of Construction Management and Management Contracting (quality, time, cost)
Pros
Quality - Client retains design control. Each package can be subcontracted to a specialist. Early involvement to utilise expertise.
Time - Can overlap design and construction
Cons
Cost - Can’t achieve full cost certainty until the last package is procured
Pros and cons of open tendering
Pros
Most competitive
Limits favouritism
Cons
Can waste time filtering through unsuitable contractors
Pros and cons of Selective tendering
Pros
Provides some competition but reduces the risk of wasting time on unsuitable contractors
Cons
Less competition compared to open
Pros and cons of negotiated tendering
Pros
Time and cost savings as a result of removing the tender process
Cons
Increased costs due to a lack of competition
What are the benefits of two stage tendering
Early contractor involvement can improve the overall buildability as well as allow for increased value engineering
What’s included in a PQQ
Company details
Insurance details
Financial information
Relevant experience and ability
Confirmation of their Capacity
H&S policy
Environmental policy
Legal review
How did I review the contractors response to my PQQ
I discussed the weighting system with the client.
I then circulated this with the design team to score each response out of 10.
I then shared the responses with the client.
Who drives the weighting system for the PQQ
The client
Outline the steps of carrying out a tender review
Open the tenders
Issue a tender opening form to the client
Issue the tenders to the design team for review
Review the assumptions and exclusions
Balance the tenders
What should the tender opening form include
Price
Programme
OH&P
Other %’s
List of documents that haven’t been provided
What would you find in the tender prelims
A general summary
Method statements
Pre construction info
Planning conditions
Outstanding statutory approvals
PW requirements
Reporting requirements
Insurance requirements
Bonds and warranty requirement
H&S requirements
What’s the purpose of prelims in the tender docs
Provide a description of the works that allows a contractor to assess the costs which are required by the method and circumstances of the work
Under a D&B Contract what documents set out the basis of the contract scope of works
Employers Requirements
Who holds responsibility for the Employers Requirements under a D&B contract
The employer but it can be amended for the contractor to accept responsibility
Who holds the risk that the scope of works have been quantified against the employers requirements under a D&B correctly
the contractor
Generally, How many contractors would you invite to tender
3-6
Why wouldn’t you invite more than 6 contractors to tender via the selected tender route
Because it will often put other tenderers off
Waste time
Name some differences between JCT and NEC
JCT is designed to transfer risk to the contracts for whereas NEC is a more partnered approach
JCT requires an EA/CA whereas NEC requires a PM
NEC implements an early warning procedure which obliges the parties to flag a risk as soon as they become aware of it. JCT only requires the Contractor claim for after the risk has occurred.
JCT has relevant events and matters which can be treated separately. NEC has compensation events where time and cost are assessed together
Where are JCT and NEC contracts usually used
JCT - Private Sector
NEC - Public and Infrastructure sector
How are errors in tenders dealt with
As per JCT tendering practice note 2017
Alternative option 1: correction of the tender price is not permitted
Alternative option 2: correction of the tender price is permitted
Explain alternative option 2 in terms of dealing with errors in the tender returns
Tenderer is given the details of the errors.
If the tenderer wishes to amend their tender they should amend the original tender and initial the changes or confirm the changes in a letter
What document would you refer to if you wanted clarification on how to let a contract
JCT Tendering Practice Note 2017
How would you deal with qualifications from tenderers
Collate all qualifications into a spreadsheet and distribute to all tenderers.
Get the tenderers to provide a response on how their tender compares/ deals with the qualifications raised.
How do you deal with clarifications in a tender
Issue the clarification and responses to all tenderers
What should a tender report include
Details of the tenderers
Comments on the proposed Schedule of amendments
Risks (I.e prov sums)
Programme
Proposed contract sum
Key %’s
Assumptions and exclusions
Outline any missing documents
What does GMP stand for
Guaranteed maximum price
Who benefits from the cost savings in a guaranteed maximum price contract
Can be either the Client, Contractor or shared between both parties
Explain Pain/ Gain agreement
A target cost/ max contract price is agreed.
The contractor will benefit from savings but will have to absorb overspends
