Transmission and Distribution Electrical Engineering, Third Edition

22.6: TENDERING

22.6 TENDERING

22.6.1 Choosing the contractor

Contractor selection may be achieved by direct negotiation between client and perhaps only one well-known contractor or via the process of open competitive tendering. In order to avoid a large number of bids from, perhaps, unsuitable tenderers the client may restrict the number of prospective tenderers by an initial pre-qualification and use of a short list of suitable contractors. The advantages and disadvantages of these methods are described in Table 22.3. Note that the tendering process for large public works within the European Union (EU) is covered by legislation.

Table 22.3: Methods of tendering

Type of tender process

Advantages

Disadvantages

Open competitive tendering

  1. Allows many and perhaps new contractors to bid for the work.

  2. Allows tender list to be without bias.

  3. Ensures good competition.

  4. Prevents contractors from fixing prices between themselves

  1. Long tender lists wasteful of client and contractor time and monies. May discourage otherwise good contractors because of the remote chance of obtaining the contract.

  2. Tender adjudication open to scrutiny and question if lowest bidder is not granted the contract.

Selective tendering

  1. Only competent contractors invited to tender for the works.

  2. Cost of tender adjudication reduced.

  3. Competing contractors may have freedom to allow adequate profit level and therefore flexibility and stability.

  1. Must avoid favouritism when drawing up list of tenderers.

  2. Must continually review tender list in order to allow new contractors to compete.

  3. Possible higher tender prices in...

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