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Procurement & Tendering Flashcards

1
Q

What is Procurement?

A

How the services of a contractor are purchased

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2
Q

What is Tendering?

A

How the successful contractor is selected

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3
Q

What are the different forms of Procurement?

A 
Traditional lump sum
Traditional re-measurement
Design and Build
Construction Management
Management Contracting
Frameworks
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4
Q

What are the different forms of Tendering?

A

Open
Selective single stage
Selective two stage
Negotiated

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5
Q

What is serial tendering?

A

It combines competitive and negotiation
Client procures a project with contractor in a competitive way and includes in tender docs the rates for future works, these then form the basis of negotiations on future projects

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6
Q

What is Two Stage Tendering?

A

It separates the process of selecting a contractor from the process of determining the price of the works.
First stage is used to agree prelims, over-head and profit, programme.

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7
Q

What can the first stage appointment be based on?

A

Pre-construction and construction programmes
Method statements
Prelims
OH&P
Schedule of rates to be applied to stage 2
Agreed design fees
CVs of proposed staff
Agreed contract conditions for the second stage

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8
Q

What is a PCSA?

A

Pre-construction services agreement
A way for clients to employ contractors before the construction contract commences
Used to appoint contractors for stage 1 of a 2 stage tender

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9
Q

Why does Design and Build procurement appeal to clients?

A

Because it gives a single point of responsibility for the entire project

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10
Q

What services do contractors commonly provide under a PCSA?

A 
Design
Buildability advice
Advice on packaging of works
Appointment of specialist sub-contractors
Cost planning
Programming
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11
Q

What should be included in a PCSA?

A

JCT publishes 2 standard forms of PCSA, one for general contractors and one for specialists
Scope of services
Any design liability
What happens to design liability of the contractor is not appointed for the second stage
Set out method for payment
Appendix setting out all tender items to be applied to the construction contract
A statement that there is no obligation to proceed to the construction contract

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12
Q

What are the advantages of 2 stage tendering?

A

Allows client to transfer design risk to contractor
Client gains buildability advice
Client gains cost certainty
Client gains programme certainty

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13
Q

What are the disadvantages of 2 stage tendering?

A

Client loses leverage as the contractor becomes embedded in the project team and competition for the second stage reduces.

NB. Whilst tender prices for 2 stage projects may be initially higher than single stage (which are subject to full competition) the final account tends to include fewer variations and claims, due to early engagement and collaboration.

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14
Q

How do you deal with Errors in a Tender Return?

A

It depends on which alternative is selected from JCT practice note 6 (2017);
Alternative 1 - confirm or withdraw
Alternative 2 - Confirm or amend

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15
Q

What is the difference between Management Contracting and Construction Management?

A

In construction management the client is in direct contractual relationships with the trade contractors, the construction manager is not.
In management contracting the client is in a contractual relationship with the management contractor, who is in contractual relationships with the trade contractors

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16
Q

What is PAS 91?

A

Publically Available Specification 91 - provides a government standard for public procurmenet. Sets out content, format and use of questions used for construction procurement.
Government standard for construction related procurement.
It is mandatory for central government projects and recommended for others

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17
Q

In a Construction Management contract, who takes the risk for trade contractor performance?

A

The client

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18
Q

How is a Construction Manager likely to be paid?

A

Based on reimbursable costs + an agreed pre and post contract fee

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19
Q

When would a remeasurement contract be used?

A

When the works can be described in reasonable detail but the extent cannot. Usually civils.

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20
Q

What would you include in a Pre-Qualification Questionnaire

A 
Details of Contract Particulars
Company Turnover
Relevant Experience and References
Company Accounts
Key Staff
Management and Organisational Structure
Health and Safety Records
Quality Assurance Systems
Provision of Bonds / Warranties / PCGs
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21
Q

Where would you find information on what to include on a PQQ?

A

The RICS provide a template for PQQs

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22
Q

What are the Contents of a Tender Pack?

A 
Invitation to Tender
Instructions to Tenderers
Certificate of Bona Fide Tender
Scope of Works
Tender Drawings and Specifications
Programme Requirements
Environmental Considerations
Commercials
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23
Q

What are the Contents of a Tender Report?

A 
Executive Summary
Introduction
Lists of Tenders Received
Tender Period
Initial Tender Return Totals
Any Qualification Identified
Post Tender Adjustments
Revised Tender Sum
Issues to be Resolved
Tender Returns V PTE
Recommendation
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24
Q

How would you carry out a Tender Analysis?

A

Arithmetic check for errors
Check ageist PTE and current budget
Look for missing scope, exclusions, provisional sums
Resolve any errors against the JCT Practice Note 6 Alternative selected
Conclusion forms the basis of recommendation to client

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25
How do you equalise tender returns?
The mean of the other tenderers The highest of the other tenderers Cost plan rate
26
What factors effect choice of Procurement Route?
``` Nature of the project Scope of works Measure of control by client Level of experience of client Accountability Appointment of a contractor Requirement for cost certainty Start and completion dates Post contract change ```
27
How will the chosen procurement strategy affect the project?
The client's exposure to financial uncertainty The client's level of control over the design The extent of the design required at tender The level of information require in order for construction to commence Contractor involvement in design The project risk profile
28
Why is it important to continually review the procurement strategy?
Because the client's attitude to risk may change over time as some risks materialise
29
How would you decide on the length of tender period?
``` JCT Tendering Practice note Complexity Size Time of the Year Market Conditions ```
30
What do Construction Management services include?
``` Procurement advice Advising on appointments Advising on buildability Defining KPIs for trades Cost planning and cost control Preparing a construction programme Identifying trade contractors Tendering trade contracts Arranging site accommodation Arranging labour Co-ordinating trades Collating as-built information ```
31
What forms of contract can be used for design and build?
JCT NEC ICE GC Works
32
What is contained in the JCT Tendering Practice Note?
A general commentary of tendering practices and procedures for public and private sectors Model forms compiled by JCT
33
What is the tender process for single stage competitive tendering?
``` Compose longlist PQQ Shortlist Invitation to Tender & Tender Submission Recommendation Award contract ```
34
What is the tender process for two stage competitive tendering?
``` Compose longlist PQQ Shortlist Invitation to tender & stage 1 tender Recommend a preferred bidder Pre-construction phase & PCSA Stage 2 negotiation Award contract ```
35
How long did you give the contractors to respond to a PQQ you have issued?
14 - 21 days
36
What did you issue along with your PQQ?
``` A project information schedule This described; The employer The tendering procedure The programme requirements CDP requirements BIM requirements Form of contract to be used Suggested contract particulars Amendments PCG & Performance bonds Criteria for pre-selection Alternative for errors in the tender ```
37
In a competitive tender, how many contractors would you go out to tender with?
3-6 | or no more than 4 for D&B due to the additional work of developing the design
38
How long would you allow for a tender period?
It depends on the complexity of the scheme and whether the contractor is required to complete any deign. If it is a simple single stage tender with no CDP, 28 days. If I was unsure how long to allow I would ask the contractors to recommend a tender period as part of my PQQ.
39
What should you include in an Invitation to Tender?
``` A list of the documents included The time and date for tender return Contact point for communications Basis of award Mid tender interviews Site visits Documents to be supplied by tendering contractor Which JCT Pricing Alternative is selected ```
40
What would you do if a tenderer submits a qualified tender?
I would give them the opportunity to remove the qualification so as to make it a compliant bid, but without amending price. If they refused the tender may have to be rejected.
41
Following contract award to the successful contractor, would you issue the tender list and tender prices to the unsuccessful contractors?
I would issue the tender list in alphabetical order I would issue the tender prices in ascending order I would not attribute the prices to the names
42
Tell me about Design, Build, Finance and Operate procurement (PPP/PFI)
A single contractor (or a special purpose vehicle) is appointed to carry out design, construction and operation of the building. The contractor finances the project and leases it back to the client for an agreed period of time (30 years) after which it reverts to the client.
43
What is a procurement route used for PPP or PFI?
Design, build, finance, operate
44
What are the advantages of Framework Agreements?
They allow a client to reduce timescales, learning curves and other risks when continually commissioning construction works.
45
How do tender documents become contract documents?
If there are no addenda then they can just be appended to the form of contract
46
What is GMP?
Guaranteed Maximum Price An agreement with contractor that the contract sum will not exceed a specified maximum Typically used in D&B where contractor is required to complete design If the GMP is exceeded the contractor bears the costs If the cost is lower the contract should set out whether this goes to the client, contractor or is split Pain & Gain or Target Cost
47
Who takes the risk of unknowns in GMP?
The Contractor Events such as exceptionally adverse weather, PS etc. all have to be included within the contractor's GMP This means they will usually tender higher If these risks are priced but do not occur, client has paid for nothing If all these risks occur the contractor will be under financial strain and may seek to recuperate costs elsewhere
48
Can the Guaranteed Maximum Price change?
Yes it can still change due to client change, scope increase or decrease There can be disputes around what is client change and what is not
49
What is Partnering?
It is a co-operative relationship between business partners formed in order to improve performance in delivery of projects. It does this by putting an emphasis on the importance of common goals. It is not in itself a procurement route.
50
What are the ways of implementing Partnering?
Using a traditional contract with a separate partnering charter A 2 party contract aligned to partnering. Parties are then contractually bound to work together A multi party partnering contract however this creates a complex legal situation
51
How is risk dealt with in partnering?
The risks faced by both parties are made transparent at project commencement and the partners share the risks on the basis of who is best equip to deal with them
52
Are you aware of any update to the JCT tendering practice note?
Yes it was updated in 2020 The main difference is that public and private sector procurement have been clearly split Time for response has been updated to the current OJEU notice period; PQQ (public) has been reduced from 37 days to 30 Tender period for public procurement has been reduced from 40 days to 35
53
What are the key differenced between public and private sector procurement?
Public: Applies to gov. and gov. funded agencies only OJEU applies to contracts above a certain value Defined minimum timescales for tendering Required to advertise on OJEU to all potential participants Mandatory standstill period to allow unsuccessful tenderers to challenge award Public accountability Performance specs rather than technical specs Private: Applies to all non-publicly funded projects No thresholds Allowed to set own tender timescales Allowed to negotiate with any potential tenderer No standstill period prior to contract award No requirement to select best value bid Free to use any form of detailed tender documentation
54
Why were the OJEU regulations introduced?
To achieve an open & competitive pan-European marketplace To promote an efficient, non-discriminatory selection process The achieve value for money To achieve transparency & accountability for bidders and for the awarding body's stakeholders Managed well, the process should ensure effective decision making takes place
55
What is a project execution plan?
``` It is usually prepared by the project manager It usually contains; Project overview Specific objectives Proposed procurement route Project control mechanisms Project time schedule Project budget Personnel and responsibilities Evaluation methods Potential problems ```
56
What external factors (outside of the client's control) should be considered when deciding a procurement route?
``` Changes to cost and availability of finance Technological development Changes to levels of inflation Changes in demand for construction Availability of specialists Changes in legislation ```
57
Do you know of any e-tendering services?
The RICS has an e-tendering service
58
What are the advantages of e-tendering?
May be possible to reduce tender period Reduced printing and mailing costs Maintains an audited trail of communication
59
What are the different forms of tendering?
``` Negotiated Selective single stage Selective two stage Open Competitive ```
60
What are the common procurement routes?
``` Traditional lump sum Traditional remeasurement Design and Build Construction Management Management Contracting ```
61
How do you carry out a tender analysis?
Arithmetic check Reconciliation to PTE Look for missing scope, exclusions, prov sums Resolve errors against JCT Practice Note 6 Conclusion forms the recommendation to the client
62
Why did you chose a negotiation for the Visual Mock-Up project?
The client's key requirement was quality. They have a relationship with a contractor who has constructed similar mock-ups before.
63
What is the difference between a pricing document and contract sum analysis?
A contract sum analysis is used in design and build contracts
64
What did you include in the tender pack for one of your projects?
``` Invitation to tender Instructions to tenderers Form of Tender Certificate of Bona Fide Tender Drawings, specifications, scope of works Pricing document Pre-construction information Programme requirements ```
65
What did you include in your façade PQQ?
``` Company accounts Company turnover Organisational Structure Key staff Relevant experience Health and safety records Details of contract particulars Environmental policy QA systems Provision of bonds and warranties Commercial section / market testing ```
66
On the Visual Mock-Up project, what did you advise the client were the drawback of a negotiated tender?
There is less certainty that the contractors is submitting a fair market price for the works, so I had to market test some key elements of the work too. This meant that some of the time saving usually associated with a negotiation could not be realised.
67
What did you advise the client were the risks of including provisional sums?
A provisional sum is a sum of money set aside for work that may or may not actually be carried out The scope or spec of work is not known and therefore can not be given a firm price Going into contract with too many provisional sums will reduce cost certainty
68
What did you include in your tender report?
``` Introduction Executive Summary Schedule of tenders opened Tender period Initial tender return total Any qualification required Post tender adjustments Revised tender sum Issues to be resolved Reconciliation to PTE Recommendation ```
69
Did you use a scoring matrix to make you tender recommendation?
The tender returns were scored from a technical perspective However an overall scoring matrix was not used Two tenders were over budget and of the two that were on budget, one was much better from a technical perspective. Therefore this one was recommended by the team,
70
What is the difference between construction management & management contracting?
Construction Management - client appoints a construction manager to manage project however trade packages are let directly by client. Management Contracting - A contractor would let the trade packages however its as and when design is ready by client and is often let on a pre-agreed cost plus OH&P for the contractor. There is often no LDs, or lump sum contract sum - often a target contract sum. Like a cost plus arrangement.
71
What would you do if there are discrepancies between ERs and CPs within a contract?
Under clause 2.13 of JCT SBC - contractor to give notice of proposed amendment to adjust and client to confirm via written instruction
72
How do you deal with errors in a tender?
If under JCT - ITT and instruction to tenderers should set out if option1 or 2: 1 - Stand by or withdraw 2 - stand by or amend.
73
What would you include in an enquiry?
``` ITT letter Form of tender Contract terms Project Info Works Info Design Info Pricing document Insurances / Bond Requirements Appendicies ```
74
10. What are the 3 types of contractor selection techniques?
a. Open b. Selective c. Single contractor selection
75
11. Tendering procedures?
a. Single Stage b. 2- stage c. Negotiated
76
12. What are the 4 types of procurement? | a.
Traditional b. D&B c. Management contracting d. Construction management – most client risk
77
12. What are the 4 types of procurement? | a.
Traditional b. D&B c. Management contracting d. Construction management – most client risk

RICS APC - ERH (22 decks)

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