Friday, June 18, 2021

Bid and tender – differences you need to know

Must read

Tender and bid are words most people are familiar with. Especially those in business use these words frequently in their communications. Primarily applied with regard to government tenders, these words have got a wider applications over their evolution.

When an entity needs the service of another entity, the entity needing the service creates an open request for with the service details and invites bids on the requirement. Organizations that are interested to offer their services submit their bids on the project mentioning the cost, deadline they can work with and the other specifications of the services they will deliver to meet the buyer’s requirement. After reviewing the bids submitted, the entity asking for the services will decide whom to allocate the contract after evaluating the bids on the basis of several parameters.

What is a tender?
In simple terms, a tender is a process adopted by a government or private entity that invites another company or organization to work for them. The entity posts the job details on newspapers or on their website. The entities interested to deliver the service asked for will submit their bid with the quotes. The tender will be allotted tot eh firm that is found suitable to the buyer’s expectations with regard to the bidding price, quality of work assured, and days of completion in addition to several other criteria that the buyer might have in their understanding. Since safety of payment is one of the most attractive parts of government tenders, most entities eagerly look forward to winning government tenders.

Different types of tenders
Tendering is a detailed process. There are mainly three types of tenders which can be elaborated as follows.

Open tenders
Open tenders are those that are open for bidding to anyone. The entity needing the services will advertise the proposed project and those that are interested can apply for the project by submitting their bid and quotation.

Selective Tenders
As the name suggests, selective tenders are open only for certain people. Before advertising, the entity seeking the service will call for some specific information and the bidders are selected and rejected based on the information they submitted.

Negotiated Tenders
When the buyer allocates the work to a contractor of their choice, the process is called as negotiated tender. Allocating the work to a particular entity follows several reasons like the quality of the work the entity can assure or the track record they have been able to demonstrate through the journey they made so far. In most such cases, the buyers give repeat jobs to the select organization.

What is a bid?
When the entity looking for some services publishes the RFPs, the entities ready to provide their services share their proposals for the work that will include the pricing, date on which they can complete the job, a few details regarding their suitability to the project and some other information and details asked for. The buyer has their own criteria to select the supplier. In some cases, the buyers can seek a few pieces of information and select the entities who are eligible to submit the bids.

Take home
The word tender refers to the whole process of awarding contract and bidding refers to a single step involved in applying for winning the contract. Professional bid writers offer their services for a fee and organizations that look forward to winning the tenders in a competitive environment make use of their services.

- Advertisement -

More articles

LEAVE A REPLY

Please enter your comment!
Please enter your name here

- Advertisement -

Latest article