Organisations often use tenders to help them select a suitable contractor to undertake a major works project, or to supply services or equipment.
Tenders involve a call for submissions from suitably qualified businesses who compete to win a contract for the project.
They are a highly effective way to filter applicants, ensuring the chosen candidate meets strict requirements around quality, purpose, cost, deadlines and criteria.
A tender document holds all the information that interested parties will need when putting together their tender submission.
It’s a complex document set out in a very specific way. If the organisation calling for tenders get any aspect wrong, it can delay the entire process – even voiding it completely.
So, what is a tender document, and how is it prepared?
The tender document
Tender documents are commonly used by government departments, hospitals and educational institutions, and large private organisations.
The document itself contains all the essential application forms and background information candidate businesses will need to consult when drawing up their submission.
When complete, the organisation issuing the tender generally makes it publicly available through recognised media channels and specifies a timeframe for submission of bids.
To reduce the potential workload, applicants will generally have to pass a certain set of criteria to be eligible to make a submission.
This whittles down the number of suitable applicants and maintains the quality of submissions.
Preparing the tender document
Meticulous attention to detail and process is required when preparing a tender document, which is made up of several different sub-documents.
It’s important to follow a designated system to ensure the overall document is structured correctly.
The 11 components of a successful tender document are:
1. Cover letter
This is the formal letter which gives important background information including tender deadline, the scope of the works and contact details of the tendering organisation.
2. Invitation to tender
This gives bidders instructions on putting their application together correctly, ensuring they meet evaluation criteria.
3. Form of the tender
This covering document must be signed by the bidding business to confirm full understanding and acceptance of terms, conditions and other contractual requirements.
4. Terms and conditions of the contract
This document provides the legal framework of the tender agreement, detailing every aspect of regulatory compliance. Both parties must sign up to the contract before any works can proceed.
5. Bill of quantities
The bill of quantities sets out a base cost for every item included in the tender.
Potential contractors then provide their own cost bids for each item, which can be easily compared by the tendering organisation and negotiated at a later stage if necessary.
This section lays out the policies and guidelines each bidder must comply with. This includes the quality, materials and safety standards expected, along with required outcomes the successful applicant must achieve.
7. Design drawings
These drawings and plans give the nitty gritty of the project, clarifying the detail involved in successful completion of the work.
If the project involves construction, the design drawings provide clear, concise information about the building site, methods and structure required.
8. Quality requirement
This involves the bidder filling in a questionnaire, giving precise detail about how the work will be carried out and completed.
This is where the bidding business needs to demonstrate a strong track record of successful work and proof of ability to complete the project to a high standard.
9. Evaluation criteria
This document explains to all bidding parties how the tendering organisation will compare and evaluate the bids submitted.
This gives bidders clear criteria to address and measure themselves against when preparing their submission.
The criteria generally includes a proviso that the tendering organisation’s judgement is final, and explanations will not be given about the final choice.
10. Tender return label
The tender return label simply gives the time and date by which all tenders must be received.
11. Pre-construction information
This document sets out a range of important information needed by bidders, including details of the brief and timelines for the construction phase.
Its chief concern is overall management of the project, to ensure that all service providers co-operate, co-ordinate their work and use safe practices at every stage of development.
Taking time to prepare the tender document carefully can save time, money and stress, helping organisations achieve a successful outcome.