Last edited 08 Jan 2018

How to prepare tender documents

A tender is a submission made by a prospective supplier in response to an invitation to tender. It makes an offer for the supply of goods or services, including a price and proposals for how the requirements will be satisfied if these have been requested.

An invitation to tender provides prospective suppliers with tender documentation setting out the information they need to prepare their offer. It is vital that tender documents are comprehensive and clear if realistic prices are to be obtained, making it more likely that the project will adhere to the budget once the works begin, and reducing the likelihood of misunderstandings, mistakes and claims.

Tender documents might include:

Care must be taken to ensure the documents are consistent so as to avoid any opportunity for misinterpretation or ambiguity. Copies of the tender documentation should be kept for records. It can be sensible to send relevant documents direct to sub-contractors named in the tender documents and telling the tendering supplier that this has been done, so they do not have to it themselves.

On larger or more complex projects, tender documents should be broken down into a series of packages (even if there will only be one main contract), each with its own design drawings and specifications suitable to be issued by the main contractor to potential sub-contractors. This makes the tender easier to price for the contractor and it makes it easier for the client to compare tenders, for example assessing the ways different suppliers have apportioned costs, which can be useful in subsequent negotiations.

It is important, when this is done, to ensure that the interfaces between packages are properly identified and clearly allocated to one package or another. Having too many packages increases the number of interfaces and so the potential problems.

The suppliers will need to appraise the tender documents themselves before sending them on to any subcontractors for them to price and return. This can take time, so it is recommended that when setting a timescale, to consider how complex the supply chain is likely to be and how important it is that responses are received quickly.

Mid-tender interviews may be arranged to allow clarification of matters that might otherwise lead to an inaccurate tender being submitted, they can also give the client insights into potential problems or opportunities in the project as it is described by the tender documentation. Responses to queries raised during the tender process can lead to clarification or amendment of the tender documentation which may also result in an extension of the tender period. It is better to allow sufficient time during the tender process to investigate opportunities and clarify problems, as the resulting tenders will then be better prepared and will be likely to save time and money later.

There may be further interviews once the tenders have been received and assessed.

Once the preferred suppler has been identified there may be a tender settlement meeting to enter into negotiations. This may result in further adjustment of the tender documents and the submission of a revised tender.

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