Invitation to tender for construction contracts

[edit] Introduction

An invitation to tender (ITT - or sometimes 'invitation to treat') is a formal invitation to make an offer for the supply of goods or services. It might be issued for a range of contracts, including:

• Equipment supply.
• Design by contractors.
• Trade contractors.
• Works contractors.
• Main construction contractors.
• Demolition or enabling works.

An invitation to tender may follow an assessment of pre-qualification questionnaires (PQQs) received by the client in response to an advert they posted, and perhaps a pre-tender interview.

The purpose of pre-qualification questionnaires and pre-tender interviews is to produce a shortlist of suppliers who are deemed most appropriate for the project and who will then be invited to tender. This avoids time being wasted preparing and assessing inappropriate tenders.

[edit] What should an invitation to tender include?

An invitation to tender will include information describing the goods or services required in sufficient detail to enable the tenderer to prepare an accurate tender that is in a prescribed format so that it is easy to compare with other tenders.

An invitation to tender might include:

• Letter of invitation to tender.
• Form of tender.
• Preliminaries (including pre-construction information and site waste management plan).
• Form of contract, contract conditions and amendments.
• Employer's information requirements and BIM protocol.
• Tender pricing document (or form of contract sum analysis on design and build projects)
• Drawing schedule.
• Design drawings.
• Prescriptive or performance specifications (on public projects, tender documentation may include an output-based specification rather than prescriptive or performance specifications and drawings).
• Instructions to tenderers explaining the tender process.
• The timescale for the tender process (including the address and time for the return of tenders).
• An explanation of how queries will be dealt with.
• The evaluation process and any evaluation criteria.
• The submission required in response to the invitation to tender.
• Policy in relation to alternative or non-compliant bids.
• Policy for providing feedback to unsuccessful tenderers.

[edit] Responding to an invitation to tender

In response to an ITT, invited tenderers (bidders) will submit their tender, which will include their price for supplying the goods or services along with proposals for how the clients requirements will be satisfied.

The precise content of tenders will vary considerably depending on the procurement route, however they might include:

• A tender return slip, with details of the contract, including information such as return address and tender checklist;
• A completed tender pricing document (or contract sum analysis on design and build projects);
• Schedules of rates;
• An initial construction phase plan;
• Any design proposals or method statements that have been requested;
• Programme;
• Procedures to be adopted, such as procurement procedures and cost management procedures;
• Demonstration of capability, for example design capability, systems used etc;
• A BIM execution plan - if building information modelling is being used;
• Key project personnel, which may require submission of CVs;
• Management organisation;
• Plant and labour resources and availability;
• Prior experience, and
• References.

See also: Common mistakes in construction tenders.

Alternative or non-compliant proposals, sometimes referred to as 'variant bids' may be submitted if the tenderer believes that what they are proposing offers better value for money. However, non-compliant proposals should only be submitted if they have been requested and should be accompanied by a compliant proposal.

For more information, see Variant bid.

NB For as long as the UK is in the EU, public projects or publicly-subsidised projects may be subject to OJEU procurement procedures, enacted in the UK by The Public Contracts Regulations. The regulations set out rules requiring that contracts must be advertised in the Official Journal of the EU (OJEU) (The requirements for OJEU Contract Notices can be found at simap). This is of particular importance because the time taken to advertise contracts can be up to 52 days. The regulations also describe allowable procedures for the selection of contractors.

NB: For private finance initiative (PFI) projects, see Invitation to Negotiate.

NB The UN Procurement Practitioner's Handbook, produced by the Interagency Procurement Working Group (IAPWG) in 2006 and updated in 2012 defines an ‘invitation to bid’ as: ‘A formal method of solicitation where prospective suppliers are requested to submit a bid for the provision of goods or services. Normally used when the requirements are clearly and completely specified and the basis for award is lowest cost.’

[edit] Related articles on Designing Buildings

• Best value.
• Best value procurement.
• Bid evaluation.
• Bid writer.
• Common mistakes in construction tenders.
• Compliant bid.
• Contract sum analysis.
• E-procurement.
• Employer's information requirements.
• How to prepare tender documents.
• Invitation to negotiate.
• Mid-tender interviews.
• Most Economically Advantageous Tender (MEAT).
• Non-compliant tender.
• OJEU procurement rules.
• Output-based specification.
• Pre-qualification questionnaire.
• Pre qualification questionnaires and PAS 91.
• Preferred tenderer.
• Pre-tender interviews.
• Procurement route.
• Reverse auction.
• Selection criteria.
• Specification.
• Tender.
• Tender documentation.
• Tender evaluation.
• Tender price appraisal.
• Tender pricing document.
• Tender settlement meeting.
• The benefits of e-procurement in construction.
• Things to avoid when tendering.

[edit] External references

• OGC guidance provides a range of standard documents for obtaining and processing tenders on public projects. (now archived)
• A description of the contents of an invitation to tender for public projects can be found in PACE Guidance on the Appointment of Consultants and Contracotrs P486 and 487. (Now archived)
• OGC guide to EU procurement rules. (now archived)
• The Public Contracts Regulations.
• The requirements for OJEU Contract Notices can be found at simap