Every year, public sector contracts account fully for nearly 40% of construction work available. These commissions total in value of over 33 billion. To claim a percentage of the construction budget, businesses must secure tenders. The tender process is the method businesses are expected to follow along with to create their bid on construction contracts. Tender opportunities vary based on the needs of the general public and private sectors.
Sectors where construction tenders are plentiful include schools, hospitals, social housing and roads. The housing sector alone accounted for over 1.7bn in construction across all departments. Tenders are generally related to construction machinery, construction equipment, roof works, special trade construction works, repairs of building installations, maintenance service of building installations, architectural contracts and other related services.
Local Authorities & Construction Contracts
Local authorities have budgeted expenditures in the UK for 2010-2011 year at 121.9 billion. Fourteen percent of this budget is likely to be spent on housing, and 38% of the budget is likely to be spent on education. Currently, the UK local authorities have several construction contracts underway and several more planned. A number of these contracts contain:
The budget percentages aren’t indicative of the residual contracts in construction for 2010-2011. A large percentage of the construction contracts will soon be allocated towards construction projects related to health. The Department of Transport and Department of Children under slab insulation , Schools and Families also account fully for a significant percentage of the budget. Over 17 million will soon be spent in the Department of Health, and over 26 million in the Department of Transport is remaining on the budget because of this year. Over 8 million in contracts are remaining and will soon be allocated towards construction related to education.
Construction Tendering Process
The construction tendering process resembles obtaining tenders in other industries. Most businesses simply locate a tender provider, select a tender and bid for the business. Since the federal government supplies 25% of local employment, many construction tenders are public contracts. Hence, many businesses rely on government tenders as a vital source of income. The private sector may offer tenders through tender opportunity providers. Tenders are given online, by phone or by email. Based upon the mode of retrieval, tender searches vary. Elaborate websites have now been developed to create tender searching easier and more convenient. When tenders are displayed in real time, businesses that identify them quickly have a competitive advantage.
Selecting a suitable tender provider is nearly as important as bidding for the opportunity. Many tender providers offer construction businesses more opportunities than others. The more opportunities offered to businesses, the more likely the business enterprise will land a practical contract. Make certain that the tender provider offers tenders from both the general public and private sector. This may guarantee your construction company finds the very best opportunities.
Through tender websites, businesses may look for tenders by industry, region or other advanced methods. During registration, some websites will gather details about the business enterprise to deliver relevant tender opportunities via email. When the organization finds a relevant tender, an agent of the organization will prepare a PQQ or ITT. These documents contain questions that businesses must adequately answer regarding the opportunity. The questions should be answered thoroughly to demonstrate your business’s competitive advantage over other businesses bidding for the same construction contracts.
Some companies that apply frequently for construction contracts might be tempted to copy and paste answers in to the fields provided. While this saves the organization time, often the data isn’t relevant to the question asked. If the data isn’t relevant, this will make the organization appear less informed in regards to the opportunity. The evaluator will likely then select another applicant that provided reveal description of the way the project will soon be completed. The business enterprise with the cheapest bid that meets the project’s needs will win the contract. When the bid is won, the construction company is expected to meet the criteria outlined in the bid, including the bid price. Those that don’t might be penalized.
Businesses which are dedicated to local authority contracts should observe that small and mid-sized businesses are considered. In 2004 and 2005, these businesses won 59% of the total local authority contracts. Construction contracts were one of them percentage. These kind of businesses are encouraged to take advantage of the neighborhood authority budgets as well.
Lower Value Contracts
Contracts valued under 100,000 are thought lower value contracts. Some contracts are bid below cost to provide services under special circumstances. A number of these lower value tenders tend to be present in construction, transport, security and electrical. Businesses should remember that these contracts exist. Lower value tenders serve instead source of income. Companies that perform well on these contracts may be viewed for other tenders at full value.