There are three principal of tendering methods of tendering.

Give and discuss each giving

advantage and disadvantage of each. (30)

1.0 Introduction

1.1 Tendering is an important phase in the procurement strategy but procurement involves much
more than simply obtaining a price. There are three main types of tendering strategy which are
common to the construction industry, although there may be subtypes of each. Note that the
chosen procurement route should not affect the tendering strategy as each tendering strategy can
be used within most procurement strategies.

2.0 Definition of terms

1.1 Tendering is the bidding process, to obtain a price; and how a contractor is actually
appointed. Three types of tendering includes singles stage tendering, two stage tendering and
negotiated tendering. Single stage tendering it is a competitive type of tendering on which price
is obtained for the whole work. Two stage tendering is when the contractor is needed at the end
stage of processing a product or a good and lastly but no least we have negotiated tendering, a
negotiated tender is effectively a single-stage tender with a single contractor who returns with an
initial price.

3.0 Findings

3.1 Single stage tendering, this kind of tendering leads to selection of the best contactor, who
will be good enough to see all loose holes for the concurrent works at the site. This is only be
archived through Inviting applicants for tenders through, tender documents that are issued to a
number of present competing contractors who are all given the chance to bid for the project
based on identical tender documentation. This assures the owner with quality control through
selecting best contractor in the relevant field. Also this helps the seeker of work being done to
analyze on cost, the way they done their work as well as the price and type of machinery they
use. You might find out that not all applicant for the tender who are well equipped therefore the
owner have the write to look for all those sides thus also minimizing cost as a whole.

In addition to this single stage tendering, the bidding contractors are given a predetermined
amount of time to submit their tenders. These are then analyzed, in terms of cost and quality,
before a single contractor is declared the preferred contractor. Also it will gives much time to the
owner of the work to oversee in terms of decision and decision related issues like scheduling
paying methods and quantity of goods needed and this speeds work done. As well as showing
when the work have to be handled back to the owner through principles. For instance AB
holdings have some interest in expanding thus meaning more building complex are to be
constructed, hence AB holdings will invites A, V and K construction companies who either
specialize or not to apply for the tender but through showing their assets or potential the owner
will use one best between the three. Who satisfies the needs for the current work?

However Single-stage bids are more resource-intensive and, relative to spend, tenderers have a
lower chance of winning a job. Single-stage traditional procurement offers limited scope for a
team to develop a shared objective or for a contractor to contribute to design development.
Competitive tendering and lump-sum contracts can lead to adversarial behavior related to the
effects of changes to the agreed scope of work.

Secondly we have a two-stage tendering strategy which is useful where a quick start on site is
required, as tendering and design can be overlapped. Therefore, it would seem a natural fit for
construction management/management contracting procurement routes, which would support a
quicker start on site. This leads to quick work done. Traditional projects are generally advanced
to a far greater level of design detail before going to tender. As the contractor is therefore not
responsible for the design, it generally supports a single-stage tender. This also leads to quality
assurance.

Design and build projects pass a larger proportion of the risk and design responsibility onto the
contractor, therefore a two-stage tender can benefit from a contractor’s understanding of the
project, so that they can positively influence the design. Finally A contractor will be part of the
final stages of design before a contract sum is agreed and awarded.

However Lack of price certainty until the end of the second stage. Potential for a Contractor not
to retain a focused commitment through the second stage of the tendering process (thereby not
achieving the most advantageous and timely work package prices)All work package costs are
transferred to the Client.
Lastly and for all we have a Negotiated tender. A negotiated tender is effectively a single-stage
tender with a single contractor who returns with an initial price. This is then negotiated with the
client’s professional team for example professional quantity surveyor. The benefit of this route is
the speed with which a price can be obtained for the works. However, the competitive advantage
of a formal bidding process is compromised. Also, many public bodies and government
departments will not allow negotiated.

4.0 Conclusion

In conclusion all the principal of tendering including a two stage, single and negotiate, also they
have some advantages and disadvantages as illustrated already in the passage so I encourage
clients to go for second stage tendering to avoid scenarios where there are will be complications
in communicating with the given data by the client rather the client give final information and
requirements and resources. Second stage principal have competitive first stage through
Contractors pricing of Preliminaries, Profit and Overheads. Further cost check at first stage
through Contractors elemental assessment of total scheme cost, declaration of competitively
priced (sub-contract) work packages at second stage. Potential to involve a Contractor from the
early stages of a scheme with the benefit of his resources, expertise and collaborative working.
High level of interest from Contractors arising from low cost, low risk tendering process.
The opportunity to achieve the certainty of a fixed Contract Sum at the end of the second stage
before Contracts are executed. High risk items to the Contractor are not overpriced to “cover the
risk" as its advantages to single and negotiation. Although it have some limitations like lack of
price certainty until the end of the second stage.