Avoid Common Mistakes in Construction Tenders

Construction projects are one of the most sought after due to the large amount of contracts floated worldwide. As technologies evolve, construction projects increase since all nations want to equip themselves with the latest infrastructure. In such an environment, construction contracts are much sought after and are one of the most famous in the tendering industry. However, the sheer volume of contracts coupled with ambiguity over responses and technical understanding of the projects decreases the success rate of companies responding to these contracts. In this article, we shall shed some light on the common mistakes that tenderers make in responding to construction contracts so that they can increase their chances of success.

The advent of electronic procurement has made lives easier for procurement professionals but has increased the complexity of responses. It is a highly regulated process when it involves government entities and hence care must be taken to follow and abide by the protocols which again differ from authorities even in the same governing domain. For instance, a rail construction project has a different criterion and focuses on different elements as opposed to a road or a tunnel construction project. Hence, it is essential that companies thoroughly conduct a background study of the project, the relevant authority and their past procurement records when it comes to responding to these projects. Bidding errors can make or break a construction process especially for new bidders.

 Understanding the Acronyms:

When a new company enters into the procurement market, they must make themselves aware of all the associated acronyms that the authorities may use. The use of decimal points in transposed numbers or estimated contract values can significantly affect the way companies can respond to these projects. Although most processes are conducted online in a formal manner, it is still a good idea to touch base with the authorities directly for clarifications as this can only help in strengthening the bid. As a construction contractor, you want to present the most value added bid for which it is important to be an expert in the market (or atleast sound like one).

Difficulty in Choosing the Right Projects

Construction projects are large volume tenders and even high in quantity. According to our research as a tender aggregator website, there are more than 1,000 opportunities released daily for construction projects all over the world. Therefore, it is imperative that contractors choose the bid wisely in which they wish to participate. Since construction is an experience based business, it is important that contractors present relevant experience in the same field as the tender is floated. For instance, a hospital construction company must focus on building hospitals and bid in tenders for hospital construction as opposed to road or highway construction since this can enhance their chances of success. Using our tender aggregator service can help in narrowing down specific construction projects so that companies do not spend time and energy in finding the right projects.

Not Understanding the Competition

Like with any other industry, the construction industry is highly competitive and involves a lot of local as well as global players. It is therefore important to channelize your energy in understanding the competition and where they bid for to better understand the market. This research too can be done using our aggregator service on contract awards through which Tender Impulse offers information on awarded contracts. This shall give the companies a benchmark to bid against as it gives important information such as pricing, lowest bid and key personnel for networking. Some companies may want to pass an opportunity that is bid lower than the cost of the project by larger companies who cut down on capital for business gain. Such crucial information can help in the overall success rate.

Delayed Response Time

Although tenders come with a finite deadline, it is always recommended to bid before time to increase chances and show a sense of desperation towards attaining the contract. Authorities appreciate companies who desperately want to work with them so that they put their best effort in improving the society. Construction contractors are therefore required to bid before time and make themselves all prepared for the bid and avoid last minute submissions. Being responsive to the authorities questions and answering all of the required information is a must in submitting the response on time.

Not Managing Sub-contractors

Large projects often come with sub-contracting options. The bid submission must thus consider all costs related to sub-contractors to avoid financial distress and loss in the overall bid. While managing sub-contractors, strict and finite cost and work requirements must be listed to avoid arguments later. Having more than 2-3 sub-contractors is also recommended to avoid monopoly and get maximum profit from the job.

Not Conducting Site Visit

Although tenders and its responses are submitted online, it is mandatory that companies visit the site to understand any potential problems that may occur in completing the project. Site visits, although may sound dated, are an absolute must for construction contracts since it allows a visual representation of the actual work to be done. Not conducting a site visit may lead to inaccurate estimation or information about the project and this must be avoided at all costs.

Overall, the above pointers are the major mistakes that construction contractors make. It is always recommended that construction contractors use a tender aggregator service like Tender Impulse to accumulate the information for lead generation as well as research purposes. It also saves quality time and effort in locating the right projects while understanding the scope of work in a detailed manner. Tender Impulse is one of the best tender websites for gaining information on construction contracts.