Last edited 02 Sep 2020

Pre-tender estimate for contracts

The pre-tender estimate (PTE) is the final estimate of the likely cost of the works that are described in completed tender documents prepared to seek tenders (offers) from prospective suppliers. The pre-tender estimate itself is not included in the tender documents.

It provides a final comparison with the budget, and along with the cash flow estimate enables the client to confirm that sufficient funds are available before committing to seeking tenders.

It also gives a basis for assessing and comparing tenders when they are returned.

If the pre-tender estimate exceeds the approved budget, an explanation should be provided for the client to consider and issue instructions.

As with the tender documents, the pre-tender estimate should be broken down into a series of packages (even if there will only be one main contract), this will allow easy appraisal of tenders received, which are likely to prepared by contractors based on prices of packages received from sub-contractors. It ensures that the tenders are easily compared with one another and with the pre-tender estimate, and any anomalies or potential savings identified.

The pre-tender estimate should be prepared following a standard approach to estimating such as that defined by the new rules of measurement (NRM).

NB: A post tender estimate is '…a cost estimate carried out after the evaluation of tenders to corroborate the funds required by the employer to complete the building project.' For more information, see Post tender estimate.

[edit] Related articles on Designing Buildings Wiki


what is cost reconciliation and why is there one on all submitted tenders is required before placing a contract.

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