Tender and tender document

PROFESSIONAL PRACTICE
AKSHATA F
1700701016
FOURTH YEAR
TENDER :
■ What Is a Tender?
A tender is an invitation to bid for a project or accept a formal offer such as a takeover bid.
Tendering usually refers to the process whereby governments and financial institutions
invite bids for large projects that must be submitted within a finite deadline. The term
also refers to the process whereby shareholders submit their shares or securities in
response to a takeover offer.
■ Key Takeaways :

1. A tender offer is a public solicitation to all shareholders requesting that the tender
of their stock is for sale at a specific price during a certain time.
2. A request for tender (RFT) is a formal and structured invitation to suppliers to
submit competitive bids to supply raw materials, products, or services.
3. The term tender also refers to the process whereby shareholders submit their
shares or securities in response to a takeover offer.
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■ How a Tender Works :
1. For projects or procurements, most institutions have a well-defined tender
process, as well as processes to govern the opening, evaluation, and final
selection of the vendors.
2. This ensures that the selection process is fair and transparent. When it comes to
tender offers for takeover attempts, the conditions of the offer are clearly listed
and include the purchase price, the number of shares requested, and a deadline for
a response.
3. A request for tender (RFT) is a formal and structured invitation to suppliers to
submit competitive bids to supply raw materials, products, or services. Because
this is a public and open process, laws have been created to govern the process
to ensure fair competition among bidders.
4. For example, without laws, bribery and nepotism may flourish. Tender services are

available for potential bidders and include a wide range of tenders from private and

public sources.
5. These services include crafting suitable bids, coordinating the process to ensure
deadlines are met, and ensuring compliance with applicable laws.

■ Special Considerations :
1. A tender offer is a public solicitation to all shareholders requesting that they tender
their stock for sale at a specific price during a certain time.
2. To entice shareholders to release a specific number of shares, the offer typically
exceeds the current market value of the shares.
3. Since the deal targets shareholders directly, it effectively removes upper
management from the process, unless those members of management are also
substantial shareholders.
4. If the company looking to take over already has a notable share of the target
company, referred to as a foothold block, a minority of the remaining shareholders
may be enough to allow the company making the offer to become the majority
shareholder.

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5. However, if the requested shares are not released by the deadline, the deal is
often considered void, effectively allowing shareholders to block the deal.
TYPES OF TENDER :
● Open Or Public Tender :
1. It is most suitable for semi public organization.
2. Notice will be published in the newspaper, magazines,etc.
3. Competition is open to all.
4. Notice should have the following information :
- Name of the client
- Site address and building type
- Estimated cost of work
- EMD
- Date of commencement of work
- Price of blank tender form
- Time and date of issue of blank tender forms.
- Time and date of submitting filled tenders.
● Closed or invited tender :
1. Suitable for single and small scale ownership projects.
2. 5-6 contractors were invited to participate in the tender
3. A letter of invitation is sent to the contractor with the following points.
- Name of the owner
- EMD
- Date of commencement of work
- Time and date of issue of blank tender forms.

- Time and date of submitting filled tenders.
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● Pre registration of contractors
1. Most suitable for semi public and public organization.
2. Notice will be published in the newspaper, magazines, etc.
3. In notice its necessary to publish the following
- EMD
- Date of commencement
- Time and date of issue of blank tender forms
- Time and date of submitting filled tenders
4. Further contractors are requested to submit following points
5. Name of the company, address, name of partner/ director.
6. List of similar projects, list of projects carried in the last 3-5 years, with cost,
architect and name of owner.
7. List of construction equipment possessed and technical perssons, employed with
the company.
- IT certificate
8. Solvency certificate from bankers
9. 5-7 contractors were shortlisted and invited for tender.
■ Tender document :
1. Tender documents are an integral part of the tendering process.
2. They are a part of the invitation sent to potential contractors and suppliers by the
client organization.
3. These documents are used to seek tenders or bids for the contract as part of the
transaction process.
4. Most tender documents have certain common sections which typically require a

standard response from the bidder.
5. This standardization of the bidding process also makes it easier for the suppliers to
draft multiple bids within a limited amount of time.
6. It makes participation in the tendering process infinitely easier and more
convenient for all interested parties.
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● Qualities of good tender :
1. Terms of work specified in the bill of quantity should be clear and specific.
2. Working drawing need to be supplied wherever details involved (ex doors,
windows, grills and handrails)
3. All factory made products trade name to be mentioned
4. Basic price of materials can be mentioned in case of certain materials like marble
granite etc.
5. All tenderers shall be treated equally with same information like (specifications,
drawings and bill of quantities)
● Stages involved in finalizing tender :
1. Announcement of tender (Tender notice)
2. Submission of tender
3. Openings of received tender
4. Tender scrutiny
5. Rate analysis
6. Scrutiny report
7. Work order
Important Sections in a Tender Document:
● Conditions for participation:
This section is meant to outline the most important conditions that a supplier must
meet in order to be considered by the client. Important documents and records

proving the supplier’s eligibility for the project might be included here. The
availability of financial records, relevant licenses, insurance documents and past
project records might be some of the major conditions set for participation in the
bidding process.
● Accreditation and quality standard:
This is the section under which the potential contractor must demonstrate that
they can meet all the needs and requirements of the client. The bidder must
present the client with some certifications of quality or authority accreditations
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such as ISO, ISI, etc. You can also outline certain processes or procedures
followed by your firm that will ensure superior quality for your product or service.
● Specifications:
In this section, the potential contractor must outline all the specific information
about the project that the client might be interested in. These specifications might
include the goods and services required, the expected time frame for the
completion of the project as well as any associated requirements or needs related
to pricing, delivery and performance. This information might play a vital role in the
final evaluation made by the client.
● Conditions of contract:
This section of the tender document must provide all the relevant and necessary
information about the rights and responsibilities of the client as well as the
potential contractor. All the terms and conditions of the work that is to be
performed must also be clearly outlined under this section of the tender
document. This section is a must because it ensures clarity, comprehension and
transparency in the transactional process.
● The condition of offer:
When a bidder or contractor is submitting their offer, they must give their official
agreement to the proposed terms and conditions of the contract. The rough

timeline of the tendering process as well as the location wherein the submission
must be made are both indicated in this section. Other segments that might be
included in this section are the submission process, the evaluation process, etc.

Tender and tender document

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