Procurement and Tendering (Level 1/2/3) Flashcards
Define Procurement?
The acquisition of construction work or services
How do you develop an effective procurement strategy?
- Clearly define the projects objectives and requirements
- Select the appropriate procurement route.
- Identify and analyse risks andopportunities
- Conduct market analysis and supplier selection.
- Contractual arrangements
- Implement cost control measures.
Main types of procurement route? Benefits / Drawbacks?
Traditional
+ Client controls design, better quality & cost certainty
- Longer programme due to no design & construction overlap
Management Contracting
+ Shorter programme, with overlapping design & construction
- Little incentive for the main contractor to reduce costs
Design & Build
+ Single point of contact for Client
+ Early start on site & early price certainty
- Requires a comprehensive brief & little design control
When would you advise the use of two-stage tendering? And what are the benefits?
Advise it on high value, complex projects with uncertain requirements.
- Early contractor involvement
- Risk mitigation – contractor capabilities.
- Cost certainty
- Time efficiency – shortlisting preferred contractors early and focus on detailed negotiations.
How do you identify a client’s approach to time, cost and quality?
Communication and engagement with Client to understand their priorities
Priorities often reflect by the Form of Contract/EWI
- Contract Type
- Bonus for completion - Time is priority
- Fixed Price - Cost is priority
How does management contracting differ from construction management?
Management contracting is when the client appoints a contractor to manage the construction works on their behalf, including letting of packages etc.
Construction management is when the client hires a CM to provide project management services and acts as an advisor to the client, but does not construct the works.
When would construction management be appropriate?
Complex projects which require expertise in project management
What is your understanding of PFI as a form of procurement?
PFI means Private Finance Initiative.
In a PFI arrangement, a private sector consortium typically designs, builds, finances, and operates a public infrastructure project over a long-term period
What are the factors that would be considered in deciding the most appropriate procurement route for a project?
The route needs to align with the project’s objectives, constraints and characteristics:
o Project complexity
o Time constraints
o Budget and cost considerations
o Risk allocation and management.
o Quality
What sources of guidance do you use when you are procuring and tendering contracts or packages of work?
RICS Tendering Strategies
- Summarises what tendering is and review different strategies
Key Takeaways
- Main types of tendering procedures
- Difference between procurement & tendering
- Reasons for a robust tendering strategy (Accountability/Auditability/Reduce Conflict)
How do you determine which pricing document to use with a sub-contract (NEC Option)?
- Complexity of works
- Scope definition
- Subcontractor experience/level of auditability
- Design Control
- Contractual framework
- Risk allocation
- Resource
Outline the contents of the invitation to tender for a sub-contract package on a project you have compiled
Invitation to tender (ITT)
Instructions (Date for retrun, to whom, scoring matrix)
Form of Contract (incl. any amendments)
Drawings
Specifications
H&S Documents
Company Policies
Pricing Document
Form of Tender
How do you choose the tenderers?
The Client has an approved list of Subcontractors whom we can choose from
We have our own internal Subcontractor scoring database, which highlights good performing and bad performing subcontractors
I also run D&B reports prior to issuing tenders to ensure they are financially stable
How did you respond to queries at tender?
Technical query - Liaise with the relevant person who is best to answer, ensuring their bid is most accurate.
Commercial query - I would respond in a quick time frame and offer further help if required
How did the tendering queries work their way into the sub-contract?
Queries were usually surrounding each parties’ obligations with the works. If the tenderer had priced for the contractor to provide something for them, this would be written into the works information such that it clearly aligns with their bid.
