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  • A call for bids, call for tenders, or invitation to tender is a special procedure for generating

  • competing offers from different bidders looking to obtain an award of business activity in

  • works, supply, or service contracts. They are usually preceded by a pre-qualification

  • questionnaire.

  • Types of calls for tenders Open tenders, open calls for tenders, or advertised

  • tenders are open to all vendors or contractors who can guarantee performance.

  • Restricted tenders, restricted calls for tenders, or invited tenders are only open to selected

  • prequalified vendors or contractors. This may be a two-stage process, the first stage

  • of which produces a short list of suitable vendors.

  • The reasons for restricted tenders differ in scope and purpose. They are called because:

  • There is essentially only one suitable supplier of the services or product

  • There are confidentiality issues such as military contracts

  • There are reasons for expedience such as emergency situations

  • There is a need to weed out tenderers who do not have the financial or technical capabilities

  • to fulfill the requirements Origin of the term

  • Dictionaries explain the etymology as coming from Old French tendre, which means "to offer".

  • The following false etymology is sometimes heard:

  • When merchant ships arrived at a port of call, they would post a notice describing the goods

  • they wished to buy or sell. This notice was delivered ahead of the ship by a tender—a

  • small boatand hence the process became known as tendering.

  • Double envelope system In an open bid or tender system, a double

  • envelope system may be used. The double envelope system separates the technical proposal from

  • the financing or cost proposal in the form of two separate and sealed envelopes.

  • During the tender evaluation, the technical proposal would be opened and evaluated first

  • followed by the financing proposal. The objective of this system is to ensure

  • a fair evaluation of the proposal. The technical proposal would be evaluated purely on its

  • technical merits and its ability to meet the requirements set forth in the Invitation without

  • being unduly skewed by the financial proposal. Tender box

  • A tender box is a mailbox that is used to receive the physical tender or bid documents.

  • When a tender or bid is being called, a tender or bid number is usually issued as a reference

  • number for the tender box. The tender box would be open for interested parties to submit

  • their proposals for the duration of the bid or tender.

  • Once the duration is over, the tender box is closed and sealed and can only be opened

  • by either the tender or bid evaluation committee or a member of the procurement department

  • with one witness. Security deposit

  • Registered contractors are usually required to furnish a bond for a stipulated sum as

  • security or earnest money deposit to be adjusted against work done, normally in the form of

  • Bank Guarantee or Surety. Locating tenders

  • Public sector organizations in many countries are legally obliged to release tenders for

  • works and services. In the majority of cases, these are listed on their websites and traditional

  • print media. Electronic procurement and tendering systems or e-procurement are also increasingly

  • prevalent. A number of companies provide subscription

  • alert services which send notifications of relevant tender documents to the subscriber.

  • An array of private organisations also assist businesses in finding out about these tenders.

  • Cost may vary from a few pounds a week to a few hundred.

  • Because of the specialised language and sometimes difficult-to-grasp procedures, some organizations

  • also offer companies tender writing training, or do the writing for them.

  • Typical template contents A typical invitation to tender template in

  • any project has the following sections: Introduction

  • Project background Legal issues

  • Maintaining issues Supplier response required

  • Timetable for choosing a supplier Requirements

  • References

  • See also Construction bidding

  • E-procurement ERFx

  • Government procurement in the European Union Presales

  • Private electronic market Procurement

  • Proposal Request for proposal

  • Request for tender Reverse auction

  • Statement of work Strategic sourcing

A call for bids, call for tenders, or invitation to tender is a special procedure for generating

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