In this article, we will learn about bidding process in construction.
Bidding process in construction is a technical and well defined process to select the contractor for a construction project.
Bidding is very important from the perspective of a client or business owner. It provides the best solution in terms of contracting work.
Table of Contents
What is Bidding?
Bidding is a method of deciding the minimum cost to perform a work specified in the construction documents and drawings.
The bid indicates the price that the contractor will contract to execute the work based on the work shown and described in the bidding documents and by approved shop drawings by the consultant. Bids are prepared confidentially by every contractor.
They are generally sealed when submitted to the client. At a defined time and date, all bids are opened, competitively examined, and compared to each other in terms of the value of the contract, method of statement to execute the work, tools, and technology specified in the bidding document.
The client generally enters into an agreement to have the work performed by the contractor submitting the lowest price. Before bids may be obtained, specified contractors need to be recognized and made aware of the type of project. Sufficient data should be collected for potential bidders to allow the preparation of their quotations.
The client may or may not aspiration to prequalify bidders. In this case, where prequalification is required, the architect can have meaningful input in the process based on past experience with the specified contractor. The proposal may implement an opportunity for more consideration and discussion with the customer, architect, or engineer, bid, bidder, and bid form are preferable, to clear misunderstanding by the contractors.
After approval of client construction documents and selection of construction executing methods, the architect may help in the selection of contractors to bid the work; making of bid applications, issuance of bidding documents for competitive bidding, answering a query from contractors; and preparing and issuing any necessary additional things into bidding documents.
After that, an architect can help in analyzing bid proposals and making recommendations for the client as to the award of the construction contract to a particular contractor. The architect and consultant can also help in the preparation of the construction contract. Contractors can choose to change their bids on the basis of certain conditions, such as errors in the contract documents, modification in the product design, modification in the labor rates. Every contractor will make sure for providing for any eventuality during the period the bid is open for acceptance.
Unless provided for otherwise, bidders may cancel their bid before acceptance by the client, unless the client consents to a later withdrawal. If all conditions of the instructions to contractors have been met, then after the bids have been opened, the bids should be examined. Bids should be analyzed to ensure that it reflects accurately the cost of the work required by the contract documents. The bids can be compared with the architect’s construction cost estimate that was prepared on completion of the contract documents. Then the client may accept a bid and award the contract to the selected bidder, who then becomes the contractor for the work to execute the project under the supervision of the project consultant.
A contract can not be awarded to the contractor who bid for the lowest price, a contractor must ensure his ability to perform the quality work. A contract can be terminated during any phase of construction work if the contractor failed to ensured quality.
Sometimes a contract is given to some specific company that is very popular in its work irrespective of the lowest bidding price.
Terms Used in the Bidding Process
1. Tender Documents:
A Tender is an offer recorded as a hard copy to contractors to execute the predetermined works or to supply determined materials inside a fixed time allotment and according to states of agreement and understanding between the contractual worker and the proprietor or the office or any party.
These tender documents contain the Bill of Quantities (BOQ), works specifications to be done, the time span for the finishing of the work, states of the agreement, plans, and drawings. These records are given to the contractual worker on the installment of specific charges. The contractual worker who cites the most minimal rates for the general works is offering the agreement to execute the work.
2. Contract Documents:
Contract documents are the agreement between the client or owner and the contractors to execute the works as determined in the tender documents to states of the agreement on the rates cited by the contractor.
The difference between Tender and Contract Documents:
Tender documents are offered to different contractors in the market to get the lowest price for the specified work. While the contract documents are only offered to the selected contractors for quoted work.
While the tender documents contain the states of agreement and all the details for the predefined work, there isn’t a lot of contrast between the two as far as substance. Be that as it may, tender documents can not be submitted as Letter of Acceptance (LOA) as these are two unique kinds of documents. While a tender document can not tie the contractual worker to accomplish the work, an agreement document ties the contractual worker to finish the work according to the agreement.
Conclusion:
In this article, you got a brief idea about the bidding process to select contractors for construction projects. It is very important for engineers who work in the field of construction to know about bidding.
If you have any confusion about the bidding process in construction, please comment below.
FAQS
Not necessarily. The contract may be awarded to the contractor with the lowest bid, but other factors such as the contractor’s past experience, reputation, and ability to perform the quality work are also taken into consideration. In some cases, a contract may be given to a specific company that is known for its work, regardless of the lowest bidding price.
The bidding process typically involves the preparation of bid documents by the client or architect, the collection of bids from contractors, and the evaluation and comparison of those bids by the client or architect to select the contractor for the project.
The bidding process is typically open to any contractor that meets the pre-qualification criteria specified in the bid documents. These criteria may include a minimum level of experience, financial stability, and insurance coverage.
It depends on the terms of the bidding process. Some bidding processes may allow contractors to change their bids under certain conditions, such as errors in the contract documents or changes to the product design. However, in most cases, bids are considered final once they have been submitted and cannot be changed.
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