4 Main Types of Tendors
Open Tendors allows anyone to submit a tender to supply the goods or services that are required. Generally, an advert will be placed giving notice that the contract is being tendered, and offering an equal opportunity to any organisation to submit a tender.
Selective tendering only allows suppliers to submit tenders by invitation. A pre-selected list of possible suppliers is prepared that are known by their track record to be suitable for a contract of the size, nature and complexity required. Consultants or experienced clients may maintain ‘approved’ lists of prospective suppliers and then regularly review performance to assess whether suppliers should remain on the list.
Negotiating with a single supplier may be appropriate for highly specialist contracts, or for extending the scope of an existing contract. It can reduce the costs of tendering and allow early contractor involvement, but the competitive element is reduced, and unless the structure of the negotiation is clearly set out there is the potential for an adversarial atmosphere to develop, even before the contract has been awarded.
Serial tendering involves the preparation of tenders based on a typical or notional bill of quantities or schedule of works. The rates submitted can then be used to value works over a series of similar projects, often for a fixed period of time following which the tendering procedure may be repeated. Serial tendering can reduce tender costs, and may encourage suppliers to submit low rates to secure an ongoing programme of work.