Procurement & Tendering L3 - SoE Q’s Flashcards

1
Q

What is procurement?

A

The overall act of obtaining goods and services for a construction project.

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2
Q

What factors affect the procurement route of a specific project?

A
  1. Cost
  2. Time
  3. Control
  4. Quality
  5. Risk
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3
Q

Can you please define tendering?

A

How a contractor is actually appointed, and as such obtaining a price for the works.

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4
Q

What happens if the tender prices are higher than the pretender estimate?

A

Tenders should be reconciled against the PTE to identify where major differences are

The project team could value engineer the project if prices are over budget

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5
Q

Can you name the four different procurement routes for me?

A

• Design & Build
• Traditional
• Construction Management
• Management Contracting

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6
Q

When would you use Design & Build over Traditional?

A

You would use design and build in a situation where the client wishes for an earlier start on site. This would allow for the overlap of design and construction. With traditional, the design is typically complete prior to tendering.

An alternative reason may be that the client wishes to relinquish design risk.
With design & build, the contractor accepts design and construction risk, whilst with traditional they only accept the construction risk, with the employer maintaining the design risk.

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7
Q

What are the advantages and disadvantages of Design & Build?

A

Advantages of D&B are that there is a single point of responsibility, buildability input of the contractor, earlier commencement on site and the client relinquishes design risk.

Disadvantages of D&B are that the design is only as good as the ER’s, the client also needs to commit to a concept design early on. The contractor will factor in risk premiums and the client loses control over the design.

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8
Q

What are the advantages and disadvantages of Traditional procurement?

A

Advantages of traditional are that tender analysis is made easier, the client retains control over the design, there is reasonable cost certainty at contract award and there is limited built in contractor risk premium.

Disadvantages of traditional are that there is no buildability input of the contractor, the overall process is longer as there is no overlap of design and construction. Design risk is also retained by the client, and there is a dual point of responsibility.

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9
Q

What is the difference between management contracting and construction management?

A

With construction management the employer has direct trade contracts with trade suppliers and employs a construction manager to oversee the works.

With management contracting the employer employs the management contractor to oversee the project and they have the direct contractual relationships with the trade contractors.

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10
Q

What are the advantages and disadvantages of construction management?

A

Advantages of construction management are that there is potential for an earlier start on site, due to overlap of design and construction. There is also potential for buildability input of the construction manager and design changes can be made without paying a premium. There is also potential for lower costs due to direct trade contracts.

Disadvantages are that there is no single point of responsibility, there is no cost certainty until the last package is let and the employer must be experienced in construction.

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11
Q

What are the advantages and disadvantages of management contracting?

A

Advantages of management contracting are that there is potential for an earlier start on site, due to overlap of design and construction. There is also potential for buildability input of the construction manager, there is a single point of responsibility and design changes can be made without paying a premium.

Disadvantages are that there is no cost certainty until the last package is let, the employer must be experienced in construction and there is no incentive for the MC to reduce costs.

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12
Q

What is included within the guidance note on Tendering Strategies?

A

The guidance note provides information on single, two stage and negotiated tendering.

It also provides guidance on producing PTE’s, selecting the appropriate tendering strategy, the RIBA plan of Work, selection of contractors, tender period, tender documents, issuing of tenders, and tender queries.

There is detail on receiving tenders, and in particular opening, reviewing of tender documents, including checking for errors and normalisation. There is further advice on tender interviews and tender

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13
Q

What is the ditterence between single and two stage tendering?

A

Single Stage Tendering is typically undertaken at RIBA Stage 4 and is based on detailed design information. All contractors return a price based on the identical tender information and provide a price for the construction of the works.

Two Stage Tendering is typically undertaken at RIBA Stage 2 or 3. Used where there is a time constraint, with first stage documentation submitted to contractors and them being assessed on the quality of their bid, quality of their team, prelims price, OH&P allowance and PCSA fee. The successful bidder is appointed under a PCSA to provide buildability and programme input, before submitting a cost for the works at RIBA
Stage 4.

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14
Q

Do you know any further tendering methods?

A

•Serial Tendering
•Negotiated Tendering
• Open Tendering

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15
Q

What are the advantages and disadvantages of a single stage tender?

A

Advantages of single stage tendering are that it is the most competitive process and therefore likely to receive the most competitive price. Employer can benefit from a fixed price.

Disadvantages are that the price is only as good as the design information. As contractors aim to provide a competitive price, this may be at the cost of quality. Longer process due to tender period.

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16
Q

What are the advantages and disadvantages of a two stage tender?

A

Advantages of two stage tendering are that it allows for overlap of design and construction, and therefore possibility of an earlier start on site. It also allows for buildability input from the contractor.
There is increased possibility of identifying project risk and engaging with subcontractors earlier.
Disadvantages are that employer loses negotiating power, as well as the fact that the second stage negotiation may fail.

The contractor may try to increase their costs following the first stage. There is an additional cost associated with the PCSA fee.

17
Q

What are the advantages and disadvantages of a negotiated tender?

A

Advantages are that it may allow for an earlier start on site, and it will allow buildability input of the contractor. There are time and cost savings relating to the tender process, as well as flexibility in choice of contractor.

Disadvantages are that there is potential for a cost premium due to lack of competition. There is heavy reliance on trust between the parties and it can be seen as anti-competitive and exclusive.

18
Q

What is a negotiated tender?

A

Effectively a single stage tender, but it is negotiated with one particular contractor.

19
Q

When carrying out the tender analysis what are your options if you discover an error in the tender?

A

• Alternative 1 - Confirm or withdraw
• Alternative 2 - Confirm or amend

20
Q

How did you ensure that the tenders were compared fairly?

A

Through a process of normalisation.

Any costs that were out of place, extremely high or low were normalised.

This is done in one of three ways: taking an average of the costs, using the highest price or using the cost plan allowance for that item.

21
Q

What is a framework agreement?

A

An umbrella agreement with a series of suppliers for the procurement of goods, works and services.

22
Q

What are the advantages and disadvantages of framework agreements?

A

Advantages are that it helps to develop strong relationships and encourage collaboration. In addition it leads to time saving as rates are usually agreed up front.

Disadvantages are that contractors may become complacent as limited competition. Some contractors also may not receive work through the framework.

23
Q

You talk about going out to tender with a list of potential contractors. If you weren’t on a framework, how would you go about compiling a tender shortlist?

A

Reputation, known to employer or project team, previous experience working with contractors, colleague feedback, QQ

24
Q

How did you analyse tenders?

A

Completed a side-by-side comparison of the contractors documents

Scored tender bids for quality (60/40 split price/quality)

Quality - experience / proposed methodology / sustainability / resource planning / site visit pass/fail

Highlighted any anomalies, arithmetical errors or front loading issues

25
Q

Normalisation techniques - what are these and why are they used?

A

Adjustments to the submitted tender so that comparisons can be made between tenders and ensure the right price is being paid for the works.

Any potential issues should be highlighted to the bidding contractor.

Three options available 1) use average of submitted costs, 2) use highest cost, 3) use cost plan allowance for that element.

26
Q

What is in a tender report?

A

• List of tenders received
• Initial tender return totals
• Any qualifications identified
• Post tender adiustments
• Revised tender sum
• Issues to be resolved
• Comparison of tender returns
• Comparison with PTE
• Recommendations

27
Q

What is included in the tender documents?

A

• Invitation to Tender
• Form of Tender
• Quality Questions
• Scoring Matrix
• Pricing Document
• Contract Particulars
• Schedule of Amendments
• ER’s
• Drawings
• Specs
• PCI
• Receipt of Tender

28
Q

How do you assess a tender for quality?

A

Atender is analysed for quality by reviewing the contractor’s response to the quality questions. The questions have differing weightings and they are scored dependent on their response to the points noted within the submission.

29
Q

What are ‘preliminaries’?

A

The purpose of preliminaries is to provide a description of the works as a whole, and to specify general conditions and requirements for their execution. Along with work sections, they describe what is required to complete the works required by the contract.

30
Q

What should be included in a tender analysis?

A

Included within a tender analysis should be both a cost and quality assessment.

The tenderers will be assessed on quality based on a series of quality questions that were included within the tender pack. The tender scoring matrix will be used to assess the quality of their answers.

31
Q

How would you assess
‘preliminaries?

A

The preliminaries were assessed by completing a side by side analysis of the costs and comparing the tenderers against each other.

Any abnormally high or low costs were normalised and the resultant totals were presented and given a score based on their deviation from the lowest figure.

32
Q

Can you give some examples of ‘anomalies’?

A

Anomalies may be extremely high or low costs. These figures would be normalised during the tender analysis.

Front loading may be classed as an anomaly and the contractor may be afforded the opportunity to amend their submission.

33
Q

Tell me about different pricing documents available under different
contract types.

A

• Bill of quantities - JCT Standard /
Intermediate / NEC Options B & D

• Schedule of Works - ICT
Intermediate / Minor Works

• Activity Schedule - NEC Options A &
C, JCT Design and Build

• Contract Sum Analysis - JCT Design &
Build

34
Q

What is the OJEU?

A

The Office Journal of the European Union - rules for public procurement.

Over £4,551,413

35
Q

What has replaced the OJEU following brexit?

A

Find a tender. Tracked the EU’s OJEU process.

36
Q

What is replacing Find a Tender?

A

A new procurement bill.

Key headlines:
1. New central digital marketplace for all opportunities.
2. Public sector customers spending more than £100m per year will need to advertise their pipeline. - 18 months worth of pipeline for projects over £2m.
3. Frameworks will no longer be closed for their entire team. - must reopen after 3 years.
4. Suppliers that fail to perform can be debarred.
5. Prompt payment - 30 day terms.
6. Tender feedback - assessment summary for unsuccessful tenderers including redacted assessment of winning tenderer.