Procurement
Tender documentation gaps
Every unanswered question in a tender document is answered by the contractor, in writing, at your expense.
The situation
The gaps were not in what the documents said. They were in what the documents assumed
A refurbishment scheme went to market with a document set that had been assembled quickly under programme pressure. The drawings were current, the specification was thorough and the preliminaries had been carried over from a previous project.
The gaps sat in the assumptions: access arrangements, working hours, the condition of retained fabric, responsibility for surveys, and the extent to which the contractor could rely on the existing building information provided.
Tenderers responded exactly as expected. Each priced the assumptions it was comfortable with, qualified the ones it was not, and returned a document that was formally compliant and commercially incomparable.
What we found
A short and uncomfortable list
Reviewing the document set against the returns produced four findings, each of which had a visible price attached to it.
Preliminaries carried from a previous scheme referred to site conditions that did not exist on this one, so tenderers priced arrangements nobody needed and omitted arrangements the site required.
Existing building information was issued without any statement about reliance. Therefore every contractor qualified it, and the qualifications differed.
Survey responsibility was not allocated. Two tenderers priced surveys, one excluded them, and the apparent price difference was largely that.
The instructions to tenderers permitted qualification without requiring it to be priced, which meant the cheapest return was simply the one that had qualified the most.
What changed
Correct the documents, do not issue addenda
Addenda arriving during a tender period rarely reach the person who is actually pricing. Correction before reissue does.
Rebuild the preliminaries for this site
The carried over preliminaries were replaced with a set derived from the actual conditions, so tenderers stopped pricing arrangements the scheme did not need.
State the position on existing information
Reliance was addressed explicitly, with the client accepting a defined position rather than leaving it to be negotiated after award, when their leverage would be gone.
Allocate survey responsibility
Surveys were assigned to a party in the documents, which removed a difference that had been showing up as a price gap and was nothing of the kind.
Require every qualification to carry a value
A tenderer wishing to exclude a risk had to state what the exclusion was worth. The returns became directly comparable for the first time.
Why this happens
Documents are assembled, not reviewed as a risk instrument
Tender documentation is usually put together by whoever has capacity, from whatever exists, against a fixed market date. Commercial review of the set as a risk instrument is rarely part of the programme, even though the documents determine the entire post contract position.
Tendering and procurement treats the document set as a risk allocation exercise rather than an administrative one. Additionally, cost planning and estimating provides the cost position against which returns are actually tested, instead of comparing them only against each other.
Questions
Asked about tender documents
What makes a tender document commercially weak?
Ambiguity that a contractor can price two ways. Where a document permits more than one reading, the tender return will adopt the cheaper one and the contract will later support the more expensive one, because the ambiguity was yours. Weakness rarely looks like an obvious hole; it looks like a phrase such as as required or to suit attached to an item nobody has quantified. Those phrases are where the pricing risk sits, and they are visible on a careful read before issue.
Should I issue tender documents with some information outstanding?
Sometimes there is no alternative, and it can be managed provided the outstanding items are named. A schedule of what is not yet resolved, with a provisional sum or a stated assumption against each, keeps the tender comparable and tells you exactly where the budget is soft. What causes damage is outstanding information that is not acknowledged, because contractors then price it invisibly and differently from one another, and you compare totals that were never measuring the same thing.
How do I compare tenders that have been priced differently?
By normalising them before you look at the totals. That means listing every qualification, exclusion and stated assumption from each return, valuing them on a common basis and adjusting the prices to a like-for-like position. The lowest headline figure frequently carries the largest set of exclusions, which is why the ranking often changes once the adjustment is done. Without that step you are choosing between documents rather than between prices.
Are contractor qualifications negotiable after tender?
They are, but the leverage depends on how many bidders remain in play. A qualification raised while three tenderers are still live is a commercial conversation; the same qualification raised after a preferred bidder has been appointed is a price increase. Reviewing qualifications immediately on return, rather than after the recommendation is written, is what preserves the position. It also tells you which bidder read the documents most carefully, which is worth knowing for its own sake.
Who should review tender documents before they are issued?
Someone whose only interest is the commercial position, reading the documents together rather than package by package. Designers review their own scope and rarely see the interfaces; contract administrators review process rather than pricing exposure. An independent commercial read against the drawings, the specification and the pricing schedule catches the ambiguities that each discipline assumes another has covered. It is the cheapest intervention available on any project, because it happens before anyone has priced anything.
Related scenarios
Where this connects
About to go to market with a document set nobody has reviewed commercially?
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