What do you understand by a tender? What are the aspects which should be covered by a tender? Explain briefly the contents of a tender document.

 Tender means the document(s) submitted by the Contractor to the Authority in response to the Authority’s invitation to suppliers for formal offers to supply it with the Services.

Or

Tendering is the process by which bids are invited from interested contractors to carry out specific packages of construction work. It should adopt and observe the key values of fairness, clarity, simplicity and accountability, as well as reinforce the idea that the apportionment of risk to the party best placed to assess and manage it is fundamental to the success of a project.

 Important Sections that should be covered in a Tender Document:

ü Conditions for Participation: 

This section is meant to outline the most important conditions that a supplier must meet in order to be considered by the client. Important documents and records proving the supplier’s eligibility for the project might be included here. The availability of financial records, relevant licenses, insurance documents and past project records might be some of the major conditions set for participation in the bidding process.

ü Accreditation and quality standard:

 This is the section under which the potential contractor must demonstrate that they can meet all the needs and requirements of the client. The bidder must present the client with some certifications of quality or authority accreditations such as ISO, ISI, etc. You can also outline certain processes or procedures followed by your firm that will ensure superior quality for your product or service.

ü Specifications:

In this section, the potential contractor must outline all the specific information about the project that the client might be interested in. These specifications might include the goods and services required, the expected time frame for the completion of the project as well as any associated requirements or needs related to pricing, delivery and performance. This information might play a vital role in the final evaluation made by the client.

ü Conditions of contract: 

This section of the tender document must provide all the relevant and necessary information about the rights and responsibilities of the client as well as the potential contractor. All the terms and conditions of the work that is to be performed must also be clearly outlined under this section of the tender document. This section is a must because it ensures clarity, comprehension and transparency in the transactional process.

ü The condition of offer: 

When a bidder or contractor is submitting their offer, they must give their official agreement to the proposed terms and conditions of the contract. The rough timeline of the tendering process as well as the location wherein the submission must be made are both indicated in this section. Other segments that might be included in this section are the submission process, the evaluation process, etc.

 Tender Documents consist of the following:

1. Tender Drawings

2. The specification

                                    (a) General requirements

                                   (b)Specification of workmanship and materials

3. Bill of Quantities

4. Conditions of Contract

                                    (a) General Conditions

                                  (b)Special Conditions

5. Form of Tender

6. Form of Agreement

7. Form of bond

1. Tender Drawings:

• The purpose of tender drawings is to describe the project in sufficient detail so that the price submitted by the contractor can be expected to be realistic.

• Drawings must show sufficient detail so that there is not significant change and subsequently no significant change of the cost.

2. The Specification

(a) General Requirements • It includes relevant details of the site and information on items which do not form part of the permanent works.

(i) Preliminaries (Not part of permanent works).

They include:

• Services (water, electricity, gas, drainage) • Accommodation (offices, toilets)

• Security (fencing, watchman) • Protection • Temporary roads and lighting • Insurance              • Scaffolding                                                                                                   

 (ii) Program and sequence of construction                                                                     

(iii) Liaison with other contractors                                                                                 

(iv) List of tender drawings

(b) Specification of workmanship and materials

• It deals with the detailed requirements of every trade. The type, the quality and method of fixing (or fabrication) and testing of every item for incorporation in permanent works is described.

3. Bill of Quantities

• It is like a ‘shopping’ list It lists every work activity or component part necessary for the execution of the (permanent) works.

• These quantities are generally prepared by the Engineer’s staff and sometimes by quantity surveyors.

• Bill of Quantities is essential to cost control.

• Arranged to same sections as specifications.

• Bills of quantities are prepared from tender drawings.

It serves the following purposes:

 • To help to describe the scope of the works

• To provide a means for pricing

• To effect standardization for realistic price comparison (to provide a means of comparing the costs of different tenders)

• To provide a means of valuing completed work

• To provide a basis (method) for pricing variations.

• The Contractor inserts a rate and multiplies it with the given quantity

4. Conditions of Contract:

 The purpose of the Conditions of Contract is:

• To define the responsibilities and liabilities of the parties to the contract.

• To describe the method of administration (by Engineer)

• The Conditions of Contract define the terms under which the work is to be carried out, the relationship between the Employer and the Contractor, the powers of the Engineer and the terms of payment.

• The imposition of conditions of contract which are biased (unfair) in favour of the Employer can be uneconomical.

(a) GENERAL CONDITIONS

General conditions are essentially the framework of the construction contract documents. They provide the “hows” of the project.

Most importantly, general conditions establish all the rights and obligations of the contracting parties. Additionally, it will lay out the roles of every party and the responsibilities of each.

The general conditions will also include all the suspension, termination and alternative dispute resolution procedures.

(b)Special Conditions: This is typically an addition or amendment to the general conditions section. This document will detail the specific clauses and conditions for each task or project. For instance, if there are specific instructions that only apply to one job or portion of the build, they will be included in this document.

5. Form of tender

• It is a standard letter of offer by the Contractor to execute the works. It is prepared by the Engineer and signed by the contractor.

• It contains the main points of the offer:

– Starting date

– Duration

– Tender sum

6. Form of agreement

• To set up names of parties, list of contract documents, signatures of parties, sealed contact documents, signatures, of parties, sealed contact.

• A standard form of agreement is the legal contract between the promoter and the contractor.

• It evidences the agreement of the Employer to pay the price indicated in the contractor’s tender and the contractor’s agreement to undertake the works in accordance with the tender documents.

7. Form of bond

• It is signed by both the contractor and a third party evidencing their agreement to pay a sum of money to the Employer in the event of the contractor’s default

• Often, the Employer worries whether the work will be good. Guarantee is provided by a third party (often a bank or an insurance company) to the contractor. If the contractor does not complete the work according to the specification (contract documents), he pays sum of money (bond) to the Employer.

• The amount of bond is 10% of the contract sum.