Tendering routes Flashcards
What is single stage tendering?
Usually done at RIBA Stage 4
Given to contractors (no more than 6, usually 3 - allows for competition and reserve list)
Enter into building contract to deliver works
What are the advantages of single stage tendering?
- Competitive pricing - full scope priced in competition
- Risk allocation - clear statement of risk allocation in contract. Avoids cost escalation in second stage
- Cost certainty - early contractual commitmment for whole works (some may be provisional)
- Known timescales
What are the disadvantages of single stage tendering?
- Design team does not have the benefit of contractors experience at design
- Issues such as continuity of work, buildability impact on final price of project
- Price is only as good as the information provided
- Competitive tender may encourage contractors to take risk in pricing
- Sequential design & construction remove opportunities for acceleration of the programme
How does single stage tendering work with traditional procurement?
- Opportunity for most competitive price. Comeptitive tender for the whole of works
- Most linear form of tendering
- Limits contractor involvement on the deisgn
- Can see high levels of provisional sums
- Programme is longer due to linearity of design and tendering
How does single stage tendering work with D&B procurement?
- Opportunity for most competitive price
- Contractor involvement earlier
- May have higher risk allowances as contractor may not understand the project
- Programme to include for tender period
How does two stage tendering work with traditional procurement?
- Contractor expertise on developing design
- Contractor involvement may outstanding design and construction risk
- Ability to overlap design & tender
- No real incentive for contractor to mitigate risk as most is client side
- Programme may have to accommodate tendering periods if design & construction cannot overlap
How does two stage tendering work with D&B procurement?
- Increased contractor involvement with design
- Some degree of competition
- Ability to overlap design and tendering
- Contractor takes design risk
- Lack of competitiveness as 2nd stage
How does two stage tendering work with management contracting?
- Some degree of competitiveness for OH&P, prelims and profits compared to negotiated
- Increase to programme to accommodate the tender period
How does two stage tendering work with management contracting?
- Some degree of competitiveness for OH&P, prelims and profits compared to negotiated
- Increase to programme to accommodate the tender period
What is negotiated tendering?
Single stage tender with a single contractor who returns with initial price. This is negotiated with client’s team
Quick way to have a cost for works but competitive advantage is lost
Most public bodies do not allow as difficult to prove value for money
How does negotiated tender work with traditional procurement?
- Contractor involvement throughout process will enable more effective mitigation of risk through the design
- Lack of competitiveness ,ay result in higher costs
- Not suitable for public procurement works
How does negotiated tender work with D&B procurement?
- Contractor involvement in design stage - has to be early
- No programme implication of tendering
- Lack of competitiveness
- Not suitable for public procurement works
How does negotiated tender work with management routes?
- No tendering period required in programme
- No competition at all on preliminaries and OH&P’s and programme
What methods have you used for selecting contractors to tender?
- Selective tendering - used on Eddington and Stevenage. Shortlist drawn up by client team
Aware of Open tendering where anyone is able to express an interest to tender and it is usually published online. An example is OJEU though there were caveats contractors had to meet - Single contractor selection - this was used by my client on teh University project and required negotiation tender
How long should you give for tenders?
Will vary depending on projects. Key factors include:
- Complexity
- Size
- Time of year (e.g. christmas)
- Market conditions
JCT Tendering Practice note advises
Straight forward single stage tenders require a minimum of 28 days
For a D&B more like 3 to 4 months where design is not developed
In public procurement it is usually a minimum period of 35 days, set out in regulations
