Issue Date: 
Monday, August 31, 2015

Tenders explained

Each day hundreds of tenders are being advertised but we often only hear about those where things have gone wrong or where the concept has been abused. It gives ‘Tenders’ a stink it doesn’t deserve. In today’s blog, we look at what exactly a tender is.

A tender is an offer to perform work, supply goods, services or products at a fixed price. The tendering process is generally utilized for procurements or contracts involving substantial amounts of money. Generally speaking, it is government departments, offices, agencies, private sector companies and businesses that put requests out on tenders. By so doing, they basically ask the public for price offers to supply required products or services. Once the tenderer accepts a tender, it is binding to both the tenderer and the person or company who won the tender. Therefore, the person or company has to provide the goods or services in the manner agreed to and at the price offered. In turn, the tenderer must pay the agreed price on the agreed deadline.

What is tendering?

Tendering is the process of making an offer, bid or proposal. It can also be expressing interest in response to an invitation or request for tender. Organisations will seek other businesses to respond to a particular need, such as the supply of goods and services and will select an offer or tender that meets their needs and that provides the best value for money.

Where are tender requirements stated?

The requirements of a tender are stated in the Requests for Tender (RTF) or Requests for Proposal (RFP) documents. In these documents, the service or products the particular tendering organisation needs or requires are outlined. These documents also outline the criteria and provide instructions that are to be followed.

Tenders are usually widely advertised in both print and electronic publications. This is to allow as many people as possible to take note of the opportunity. It also stimulates competition and provides wide variety of choice. Interested suppliers will then prepare a tender response to the offer, including pricing, schedules as well as their eligibility for the project.

Once the tendering period has closed, the submitted tender responses are evaluated with regard to defined criteria. The process must be done fairly and honestly, free from bias or favoritism. The offer that best meets all of the requirements and provides value for money should win the contract.

While the concept of tendering may seem daunting at first, it can be easily tackled by having a plan of ‘action`. It is important to understand your business` suitability for the project and ability to manage the contract if you win the tender. By understanding these points and demonstrating that you are able to meet the criteria and offer a competitive bid, you will increase your chances of success.

How are tenders awarded?

After the closing date, all the tenders are checked for basic compliance to the tender regulations. Tenders can be disqualified during this process if they are found to be non-compliance. The compliance of the products or services offered and price is considered. All tenders which comply with the specifications are listed in order of price. Those in the lowest price tender list are in the lowest price group. Preference points given to those suppliers on the list of lowest price tenders are first verified. Preference points are only awarded after the most expensive tenders have been excluded, as this makes the process quicker and fairer. Those with verifiable information come out with the best preference points and are therefore awarded the contract.

The above formulate what tenders are and if you understand these, then you are in the best position to bid for a tender.

Title Closing Date Tender No.
Appointment of an accredited external water testing laboratory for AgriZone for a period of three years. 2018-09-14 11:00 DTP/RFP/11/AGZ/06/2018
Exterior painting at Wellington, Civic Centre 2018-08-30 10:00 BK016 (DIC0025814)
Procurement of grade 8 and 9 MST camp: Academic and role modeling 2018-09-03 12:00 CS/SCM/COO/MST/R18-19/27
The Department of Public Enterprises invites service providers to submit a proposal to assist the Department to manage and render an in-house canteen service. 2018-09-03 11:00 DPE 6/2018-2019
New vinyl floor covering at Soup Kitchen 2018-08-30 10:00 BK015 (DIC0025816)
Civil Engineering Services for the implementation of Rea Vaya Phase 1C Greenstone Bus Terminal for design review and contract administration. 2018-09-14 12:00 JDA/GT001
Supply: 6 each x vibration detection sensor iq2400s5-m12c 2018-08-27 12:00 GD11900208
Precinct Study, Noorder Perel, Paarl 2018-08-23 10:00 DIP0001964
Supply Equipment for metro farmworkers. 2018-08-22 12:00 GG11900273
Supply: Medical supplies 2018-08-22 15:00 GF11900116
Revamping of derelict a cricket wicket at New Orleans Sportsfields 2018-08-30 10:00 DSP0019548
Rewind and Repair both 45kw and 37kw flange mounted motor 2018-08-24 12:00 RFQ NO: 8/3/2- 57/2018
Completion of bus route at Tweefontein - G in Thembisile Hani Local Municipality. 2018-09-14 12:00 3387/17
Supply & replace of 2 x 36000btu split A/C at Mayors Office in Civic Centre, Paarl 2018-08-30 10:00 DIE0014378
Annual service and repairs of standby generators in the Water department at various venues 2018-08-30 10:00 DIC0025810
Holsloot Diversion works: Construction of concrete weir and associated structures. 2018-09-14 12:00 127/2018
Supply & delivery of pipes UPVC 110mm socketed (6m length class 51) 2018-08-23 10:00 S4W0003028
Supply and Installation of Stormwater Network at Region1 (Emzinoni Victor Khayane Road 2018-08-27 12:00 RFQ NO: 8/3/2- 60/2018
IFRS 17 Implementation Services. 2018-09-14 12:00 RFP 2018/13
Construction of a 6 point swing-over milking parlour. 2018-09-14 12:00 20/2018

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7 Disadvantages of Competitive Bidding

The bidding process can be very tedious sometimes. Here are some of the disadvantages of the bidding process.

1.    Leading suppliers may not tender

In Australia, for example, government procurement guidelines only allow suppliers who actually tender to be considered for a procurement decision. If the leading supplier or suppliers do not tender, the purchaser can only consider bids from suppliers who do tender. If leading suppliers are not considered, the purchaser may end up buying inferior product or service... Read More

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