What is Tendering in Construction? Answered!

Tendering is a procurement process where the main contractor or supplier for a construction project is selected. One crucial aspect of construction is the tendering process, with numerous stakeholders involved in its planning, design, and execution of projects, making it a complex and competitive process. 

Tendering in construction enables the selection of the best contractor for a project. 

The tendering process, which involves selecting the right main contractor for a job, is just as important as any other process in building construction and, as such, requires careful planning and execution to ensure success.  

In this article, we will explore tendering in construction, its definition, process, and benefits.

What is Tendering in Construction?

Tendering is the process by which you, as a client, invite contractors to submit bids for a construction project. The tendering process involves the preparation and submission of tender documents, which include project specifications, drawings, and terms and conditions. Contractors then prepare and submit bids, which you, as a client, will evaluate based on predetermined criteria.

The Tendering Process

The tendering process typically involves the following stages:

1. Pre-qualification: This usually involves defining the business need, assessing market capability, preparing a scope of work, and preparing an evaluation framework to assess tenders. 

2. Registration of Interest: Here, the main contractors are often invited to submit an indication of interest or registration as a precursor to a formalised tender.   

3. Invitation to Tender: In this phase, a formal invitation to tender allows the main contractor to outline their ability to meet the project’s requirements, which typically includes how the timeline will be met, the budget, and the scope of the work.  

4. Pre-Tender/Site Meetings: The meeting, which is usually set after an invitation to tender has been sent, is typically a briefing session and a site visit; this is an opportunity for potential tenderers to ask questions and clarify any concerns or details before they submit their tender.

5. Review of Tenders: This is an evaluation of the tender responses that allows you, as the client, to assess the main contractors’ capabilities and offerings—how well their solutions meet the project brief, the financial stability of the tenderers’ businesses, and the contract prices. 

6. Awarding the Contract: After the tenders have been reviewed and any negotiation completed, one of the rendered is chosen and is awarded the project contract.

7. Post-tender stage:  After the contract is awarded, the client and contractor finalise the contract details, and the project commences.

Types of Tendering Methods

There are several types of tendering methods, including:

1. Open tendering

Open tendering is a construction tendering method that fosters competition by allowing all interested contractors to bid on a project. This transparent approach ensures fairness and competitive pricing, making it a popular choice for public sector projects. By publicly advertising the tender, a wide range of contractors are attracted, providing opportunities for new and emerging contractors to secure contracts.

However, this method has its drawbacks. The large number of tenderers can lead to time-wasting, as many may be unsuitable for the project. Furthermore, the lowest bid may not always be the best fit for the project, highlighting the need for careful evaluation and consideration.

2. Selective tendering

Selective tendering involves hand-picking a selected group of trusted, experienced, and reputable contractors with a proven track record in specific services or work types. These pre-qualified contractors are then exclusively invited to bid, ensuring high-quality work and minimising the risk of non-compliance.

3. Negotiated tendering 

Negotiated tendering is a non-competitive process where a limited number of preferred contractors, typically one to three, are selected to submit a tender. Following the tender submission, negotiations ensue to reach a mutually agreeable contract. This approach is often employed for specialised contracts or urgent projects requiring expedited construction.

4. Single-stage tendering 

Single-stage tendering, or traditional tendering, is a straightforward process where the project owner releases the entire project for bidding in one stage. The tender package includes all necessary information, such as detailed design, program details, and costs. Upon receiving the bids, evaluation is done and award of a single contract to the successful bidder.

This approach is suitable for projects with well-defined designs and scopes. However, it has some drawbacks. If the construction specifications are incomplete or unclear, it may lead to contract revisions and unforeseen costs, resulting in a final account that differs significantly from the initial estimate. This can pressure the contractor to cut costs, potentially compromising the project’s quality in the long run.

5. Two-stage tendering

Two-stage tendering is a procurement approach that divides the contracting process into two distinct phases. In the first phase, a suitable contractor based on their qualifications and experience is selected. The second phase involves collaborative negotiations between the two parties to finalize the contract terms, pricing, and scope.

This tendering method is commonly used for large, complex construction projects where the design and scope are not yet fully defined. Two-stage tendering provides clients with greater control over the project’s cost, schedule, and quality, as it allows for a more comprehensive understanding of the project requirements before finalizing the contract.

While two-stage tendering offers flexibility in the procurement process, it also has some drawbacks. The tender price may be higher due to pre-tender discussions, and the process can be more time-consuming, which may not be suitable for projects with tight deadlines.

Benefits of Tendering in Construction

The tendering process offers several benefits, including:

1. Promotes competition and fair pricing: The tendering process encourages contractor competition, resulting in fair prices and better value for the client.
2. Ensures transparency and accountability: The tendering process ensures that all contractors are evaluated based on the same criteria, promoting transparency and accountability.
3. Allows clients to select the best contractor: The tendering process enables clients to evaluate contractors based on their experience, quality, and price, ensuring that the best contractor is selected for the project.
4. Encourages innovation and value engineering: The tendering process encourages contractors to submit innovative and cost-effective solutions, resulting in better value for the client.

Hiring the best professional for your construction needs

Entrusting your construction project to professionals cannot be overemphasized, as it guarantees perfectionism. 

We at Dutum Group understand and are dedicated to delivering outstanding results, and we collectively push boundaries to exceed client expectations. Unwavering in our commitment to excellence, we consistently provide superior standards in construction, upholding the highest levels of craftsmanship and premium materials, ensuring outstanding quality in every aspect.

The Building construction is complex and requires expertise at every stage to deliver a high-quality, durable, and safe infrastructure. We’re a trusted industry leader in building construction projects by partnering with an experienced construction firm like Dutum Group, with over 15 years of experience. 

Here is why you should choose us:

• Experience: With years of experience in the industry, Dutum Group brings a wealth of knowledge and expertise to every project.
• Quality: Committed to delivering superior quality in every aspect of construction, Dutum Group adheres to the highest standards of craftsmanship and materials.
• Innovation: Constantly pushing the boundaries of innovation, Dutum Group utilizes the latest technologies and techniques to optimize efficiency and minimize environmental impact.
• Customer Satisfaction: Customer satisfaction is paramount at Dutum Group. We prioritize open communication, transparency, and collaboration to ensure that each client’s vision is brought to life seamlessly.
• Project management: At Dutum, we ensure project delivery on time, within budget, and meeting quality standards. 
• Exceptional Track Record: Dutum Group has completed numerous landmark projects in Abuja, earning the trust and respect of clients and industry peers alike.
• Dedicated Team: At Dutum Group, we are passionate about what we do, consistently going above and beyond to deliver results that exceed expectations.
• Commitment to Sustainability: Dutum Group is committed to sustainable construction practices, striving to minimize environmental impact and maximize energy efficiency in all its projects

For more information, 

You can visit our website @ https://dutumgroup.com.

Or you can email us @

info@dutumgroup.com

Contact information: 

We are located in various parts of Nigeria.

Abuja:

10 Danube Close,

off Danube Crescent

Maitama, Abuja

Phone: +234 805 831 7200

Lagos:

2 Abisogun Road,

Off Palace Road,

Oniru Estate, 

Maroko, Lagos

Phone: +234 805 831 7200

Ibadan:

Isaac’s Place,

Opp. TOTAL Petrol Station,

Onireke, G.R.A

Dugbe, Ibadan

Phone: +234 706 967 1901

In conclusion, tendering is a critical process in construction that enables clients to select the best contractor for their project. The tendering process involves the preparation and submission of tender documents, evaluation of tenders, and award of the contract. While the tendering process offers several benefits, it also presents challenges and limitations. By following best practices and ensuring compliance with relevant laws