Tender floating

 


We have reached a point where the scope and specifications of the goods or services have been established, and the quantity and pricing have been determined. The tender document is also prepared. The subsequent step involves the tender floating process, wherein the employer uploads the documents onto the e-portal and solicits offers or bids from potential contractors (bidders) to supply the goods or services.

This process is formally known as the Notice Inviting Tender (NIT) and is commonly referred to as tender floating.

 

Types of Tenders

In any of the following ways, employer shall invite of the offers from bidders/ tenderers.

-        Open tender

-        Close tender

-        Specific tender

-        Urgency tender

 

Open tender

The employer is required to provide extensive publicity when soliciting tenders for the procurement of goods or services, allowing all organizations the opportunity to submit their offers. This broad publicity is expected to enhance competition and lead to cost reductions.

Close tender

In this scenario, the employer will only invite a select group of bidders to present their offers for the goods or services needed. This method is preferred when the procurement value is low or when the anticipated savings from an open tender do not justify the tendering costs. The employer selects only those vendors who have established a good reputation based on prior experience, which may result in reduced competition. Nevertheless, the likelihood of failure is minimized as bids are received from a limited pool of close-cycle vendors. This approach is also referred to as Limited or Selective Tender.

Specific tender

In this case, the employer will invite a single bidder to submit an offer for the required goods or services. This method is commonly known as Single Tender.

During emergencies, the employer will request nearby agencies to provide urgent supplies of goods or services. The value of these procurements may be minimal, and this type of tendering is utilized when delays caused by lengthy procedures are not acceptable.

 

Offer preparation by Tenderers

Upon reviewing the invitation, the bidder should initially examine the description. Subsequently, the eligibility criteria must be assessed. One might recall the behavior of a spider, which consumes small insects ensnared in its web while releasing larger prey to avoid damaging the web. If the scope of the contract exceeds the bidder's capabilities, it is advisable NOT to engage in the tender process. Should the bidder possess the necessary qualifications, it is essential to analyse and comprehend the scope, followed by a thorough reading of each term.

Next, the bidder must contemplate strategies to compete with others and successfully complete the project. In cases where the workload slightly surpasses the bidder's capacity, the feasibility of forming a joint venture with other specialized firms may be considered to enhance business opportunities. Additionally, the option of employing a subcontractor under the primary contractor should also be evaluated.

Ultimately, based on the aforementioned considerations, the bidder can calculate the costs, prepare the proposal, and submit it to the tender portal well ahead of the deadline.

 

Bids evaluation by Employer

On receipt of the bids, the evaluation by the employer is a strategic process of assessing submitted offers against pre-defined criteria (compliance, technical quality, financial strength, experience) to select the best value offer, often using a two-stage approach: first, filtering for essential technical requirements and eligibility, then scoring qualified bids on weighted technical and price factors to find the most economically advantageous tender (MEAT). 

 

Purchase Order

On selecting the right vendor, the purchase order or acceptance of offer shall be issued by the employer to the tenderer, who will be called as contractor, to commence the contract.

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