The ten elements of a ‘complete’ bidding system

Post in Blog

There is a growing trend towards moving business practices online to gain efficiencies. One of the activities in the construction industry that is moving that way is the process of submitting a bid. In other posts I have referenced the fact that it is important to make sure that moving your process online doesn’t leave gaps that can increase the risk of errors or omissions. To do that a complete bidding system that integrates all the related elements of the process is essential. What then, are the elements of a complete system?

The minimum elements that must be present to constitute a complete bidding system include:

10 element of construction bidding system1.       Bid Advertisement – If the project is not by invitation only it is important to be able to notify interested bidders that there is an opportunity to bid on. Public agencies are often mandated to advertise publicly.

2.       Invitation to bid – For when there are bidders who are to be proactively advised of the opportunity. In addition to the ability to simply ‘send a message’ the system must help organize and manage the list of potential bidders.

3.       Prequalification – For some projects the bidders must demonstrate their competence and ability to complete the work prior to being invited to submit a bid.

4.       Document Distribution – Distributing the drawings, specifications and any supplementary information is an essential element of the process. If properly integrated into the system there is no possibility of missing or incomplete information being used in the formulation of a bid submission.

5.       Addenda Notification and Distribution – All bidders must be quickly notified of any new addenda and be provided quick and easy access to the information to avoid delays or errors in the submission of bids.

6.       Creation of the Bid Form – The system must provide the ability to create the bid form including all the varied elements that make up a construction bid at a minimum including; base bid, separate prices, alternate prices, unit prices, cash allowances, stipulated sums, tax clauses, bond requirements, time to completion, labour units and other required schedules.

7.       Submission of Bid Security – The bid security is an integral and essential element of a complete bid submission and must be able to be included as part of the bid package.

8.       Submission of the Bid – The ability for bidders to follow their normal practices when preparing the complete submission is essential. It must include the ability to; apply for and receive a bid bond, complete sections of the bid as the information is available and ready to enter, allow others in their company to work on the submission if required, withdraw the bid prior to closing time if required and of course enter all required elements of the bid call.

9.       Bid Tabulation – Once the bid closing time had been reached the recipient must be able to easily compare and evaluate the information. A tabulated set of bid responses is the most efficient means to do so and is an essential element of the complete bidding process.

10.   An Audit Trail – A complete and accurate log of all the activities required to complete this process is essential to assist in avoiding and resolving issues of non-compliance or claims arising from missing or incomplete information. Knowing exactly who saw what and when it happened helps avoid many of the problems that arise following submission of the bids.

These 10 elements when enabled within a secure and reliable IT infrastructure combine to form a complete bidding system that provides every participant in the process the tools and information they need to successfully complete the aspect of the bidding process that they are responsible for.