Construction Tender Process
The practise of soliciting bids from interested contractors to perform specified building work is known as tendering. It should adopt and observe the core values of fairness, clarity, simplicity, and accountability, and promote the notion that risk allocation to the party most equipped to assess and manage it is essential to the success of a project. In this article, construction tender process, we take a look at the process involved and the options available to you.
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What are the steps in the tendering process?
Invitation to Tender
In an invitation to tender, the client-required work will be specified. Typically, it will include an invitation to tender letter, preliminaries such as pre-construction information, the form of contract, a tendering pricing document, design drawings, and any other relevant specifications for the works.
This will make it easier for potential contractors to price the documents and for clients to compare bids.
For clients who employ pre-qualification questionnaires or pre-bid interviews, these must be completed prior to the distribution of the invitation to submit a bid. This guarantees that only those qualified for the work will be invited to submit a bid.
Sometimes, mid-tender interviews are conducted to provide clarification to both clients and suppliers. This prevents the submission of erroneous bids and can save time and money in the future. To guarantee a fair tendering process, any extra information or modifications to the tender documents must be provided with all prospective vendors. However, information regarding the supplier’s plans to meet the client’s needs must be kept confidential.
Submission of the tender
In response to the invitation to tender, suppliers will submit their proposals. This will include their price for doing the work and information on how they will satisfy the client’s specifications. Typically, tenders include:
- A finished document detailing the rates, prices, and totals of the supplier. On some projects, a contract sum analysis may be used instead.
- Schedule of prices. On larger projects where the nature of the job is known but cannot be estimated, it is meant to include all actions that may be required to complete the work. The price includes both profit and expenses.
- An initial Construction Phase Plan (CPP). The CPP describes the procedures for controlling the health and safety of construction project participants. The plan must be evaluated, altered, and updated during the duration of the project. It must be simple to comprehend and applicable to everyone on the premises.
- If asked, design proposals that detail the design professionals’ proposed solution to the client’s needs.
- A work schedule that specifies the order in which things must be completed.
- Essential project employees. Frequently, clients want to know who will be working on a project, so they request CVs.
- Management structure and command structure.
- Plant and labour resources and sourcing availability.
- Prior experience with previously awarded contracts.
- References from other completed works.
Tender Negotiations
Once the client has chosen a tender, or sometimes two tenders, a tender settlement meeting may be held. These allow the client the option to negotiate with their preferred provider to agree with or explain any terms of the contract. This may involve the submission of a revised bid or the modification of bid documentation.
Any agreements reached must be ratified by both parties, as they will serve as the basis for future contract documents.
Contract engrossment and Execution
Contract engrossment is the process of including schedules and appendices into an agreed-upon contract. Engrossment of contracts may be executed under hand, where the parties sign the document, or under seal, where the parties sign the document in the presence of witnesses and as a deed. After the contract has been agreed upon and signed, it is executed, at which point it becomes legally binding for all parties involved.
Different forms of tendering
Single-stage selective tendering and two-stage selective tendering are the two most popular types of tendering. Both procedures entail the invitation of bids from firms on a pre-approved or ad hoc list, selected because they meet certain minimum standards in general characteristics such as financial standing, experience, capability, and competence. The competitive factor of the bid is determined by both price and quality. In the two-stage procedure, the contractor is involved in the development of the project at an earlier stage, so tenders are submitted with limited information. In the second stage, the employer’s team collaborates with the preferred tenderer to produce the precise specifications. This strategy is preferred for complex projects in which the contractor may have substantial design input.
Other types of tendering include, open, serial, framework and public procurement.
How we can help
We have a proven track-record of advising upon construction tendering, from small residential developments to vast commercial projects. Not only does our construction department have extensive legal experience and knowledge of construction law but we also have the benefit of chartered surveying experts. We will guide you through the process and ensure all checks are carried out swiftly and efficiently and we firmly believe that with the right solicitors by your side, the entire process will seem more manageable and far less daunting.
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It is important for you to be well informed about the issues and possible implications of a construction tendering. However, expert legal support is crucial in terms of ensuring a positive outcome to your case.
To speak to our Construction solicitors today, simply call us on 0345 901 0445, or click here to make a free enquiry. We are well known across the country and can assist wherever you are based. We also have offices based in Cheshire and London.
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