competing offers from different bidders looking to obtain an award of business activity in

works, supply, or service contracts. They are usually preceded by a pre-qualification

questionnaire.

Types of calls for tenders Open tenders, open calls for tenders, or advertised

tenders are open to all vendors or contractors who can guarantee performance.

Restricted tenders, restricted calls for tenders, or invited tenders are only open to selected

prequalified vendors or contractors. This may be a two-stage process, the first stage

of which produces a short list of suitable vendors.

The reasons for restricted tenders differ in scope and purpose. They are called because:

There is essentially only one suitable supplier of the services or product

There are confidentiality issues such as military contracts

There are reasons for expedience such as emergency situations

There is a need to weed out tenderers who do not have the financial or technical capabilities

to fulfill the requirements Origin of the term

Dictionaries explain the etymology as coming from Old French tendre, which means "to offer".

The following false etymology is sometimes heard:

When merchant ships arrived at a port of call, they would post a notice describing the goods

they wished to buy or sell. This notice was delivered ahead of the ship by a tender—a

small boat—and hence the process became known as tendering.

Double envelope system In an open bid or tender system, a double

envelope system may be used. The double envelope system separates the technical proposal from

the financing or cost proposal in the form of two separate and sealed envelopes.

During the tender evaluation, the technical proposal would be opened and evaluated first

followed by the financing proposal. The objective of this system is to ensure

a fair evaluation of the proposal. The technical proposal would be evaluated purely on its

technical merits and its ability to meet the requirements set forth in the Invitation without

being unduly skewed by the financial proposal. Tender box

A tender box is a mailbox that is used to receive the physical tender or bid documents.

When a tender or bid is being called, a tender or bid number is usually issued as a reference

number for the tender box. The tender box would be open for interested parties to submit

their proposals for the duration of the bid or tender.

Once the duration is over, the tender box is closed and sealed and can only be opened

by either the tender or bid evaluation committee or a member of the procurement department

with one witness. Security deposit

Registered contractors are usually required to furnish a bond for a stipulated sum as

security or earnest money deposit to be adjusted against work done, normally in the form of

Bank Guarantee or Surety. Locating tenders

Public sector organizations in many countries are legally obliged to release tenders for

works and services. In the majority of cases, these are listed on their websites and traditional

print media. Electronic procurement and tendering systems or e-procurement are also increasingly

prevalent. A number of companies provide subscription

alert services which send notifications of relevant tender documents to the subscriber.

An array of private organisations also assist businesses in finding out about these tenders.

Cost may vary from a few pounds a week to a few hundred.

Because of the specialised language and sometimes difficult-to-grasp procedures, some organizations

also offer companies tender writing training, or do the writing for them.

Typical template contents A typical invitation to tender template in

any project has the following sections: Introduction

Project background Legal issues

Maintaining issues Supplier response required

Timetable for choosing a supplier Requirements

References

See also Construction bidding

E-procurement ERFx

Government procurement in the European Union Presales

Private electronic market Procurement

Proposal Request for proposal

Request for tender Reverse auction

Statement of work Strategic sourcing