Procurement and Tendering Flashcards
(17 cards)
What are the primary benefits of open book tendering?
It is a great way to negotiate with a Contractor by clearly seeing the prices from the market through subcontractors.
Also, in a negotiated tender, it is a clear way to justify value for money to the Client.
What would you do if a Contractor was unwilling to engage with an open book tender?
It would depend on the Client’s requirements. If they were unwilling to engage in a open book, it would be a big red flag as to why they wouldn’t be willing to commit to open book. However, if the Client’s requirements were for time-based, I would proceed and compare the Contractor’s tender against my PTE and flag any items that are majorly different.
If the Client’s requirements were not time based, I would suggest we re-tender through a competitive tender.
What is involved in the process of ‘equalising’ and why is it important?
Equalising is the process of equalling all tender submissions so they are a like-for-like comparison.
It is important as the lowest tender does not always mean it is the most commercially advantageous, as they could have excluded large elements of work, as was the case in my project on the South Wing.
Can you explain why you received a tender recommendation report?
I received the TRR from the main contractor where they recommended the subcontractor they deemed most suitable.
Can you tell me 4 categories included in the PQQ?
1) Contractor’s approach
2) Health and safety
3) Proposed team
4) Relevant experience
How were the PQQs scored?
On a pass/fail basis.
Did you score any of the Contractor’s in the PQQ?
In this case, no I did not score any Contractor’s. Although I assembled the scoring matrix and combined the scoring/responses from all parties and included this in my PQQ recommendation report.
What was the purpose of your PQQ recommendation report?
To recommend which Contractor’s were suitable to be invited to tender.
Did you query why Contractor A had excluded such important parts of the work?
Yes, upon submission of their tender I queried why so many elements were excluded from their tender submission.
Their reason for exclusion was that they believed the various elements should be a provisional sum as there was insufficient design information to price the works. I asked them to submit their prices for the various items and they should raise formal queries on items they are struggling to price so the design team can clear any queries in scope.
You mention you made ‘adjustments’ - what were these?
I included the highest bid of the other two tenderers and added this into their price.
When equalising on the South Wing, why did you add in the highest of the other bids? Was this not unfair to that Contractor?
This same logic was applied to all tenderers, so it was not unfair to that Contractor.
My reasoning to choosing this method was that I believed it to be the most accurate way to “plug in”. For example, if I done the average of the other two tenderers, one of the tenderers may have excluded some elements of work or not have fully understood the scope of that item, so including the largest sum of the other tenderers was the safest option.
What made Contractor B the most commercially competitive in the South Wing tender?
Their rates were lowest. This Contractor had also worked on the East Wing, so had greater knowledge of the project.
Contractor C may have priced more risk into their rates.
Do you always advise your Clients to go with the most competitive commercially?
No, not always. As a Contractor may have underpriced the works as they are struggling financially and need to win work to balance their books, alternatively if they are significantly lower it can lead to more issues post contract where they are overclaiming on variations make up for any potential losses.
On PwC Manchester, what advice did you give your Client when they requested a negotiated route?
My advice to my Client was that in a negotiated tender, Contractor’s may be less inclined to price competitively.
What are the key benefits of negotiated route?
- Simplicity
- Speed. A negotiated tender can have programme advantages if undertaken in good faith.
So you knew that programme was the priority, but you advised the client should extend the tender period anyway? What was your reasoning?
This was to allow greater analysis of one of the packages. Whilst programme was the Client’s priority, there was also a great focus on the budget. For the sake of a few days, I wanted to give the Client maximum confidence on the projects costs.
Are you aware of any ways a competitive tender process can be managed to accommodate a tight programme?
- Information release schedule
- ??
