The term ‘tender’ can be quite confusing, especially when there are different types of tenders out there. In business, a tender is an offer to supply goods or services at a fixed price and within a certain timeframe. It is usually in response to an invitation to participate in a particular project. The type of tender you use will depend on the project you are working on.
Here are four of the most common types of tenders that businesses use:
1. Open Tender
2. Selective Tender
3. Negotiated Tender
4. Management Contract
There are many types of tenders that businesses can use to find the right supplier for their needs. The most common type of tender is an open tender, which is a public invitation to all interested suppliers to submit a bid. A closed tender is only open to pre-selected suppliers, and a negotiated tender is one where the buyer and seller negotiate the terms of the contract before any bids are submitted. There are also online tenders, reverse auctions, and Request for Proposal (RFP) tenders.
There are many different types of tenders that businesses can use to find the right supplier for their needs. The most common type of tender is an open tender, which is where businesses invite suppliers to submit a bid for the work they need to be done.
Other types of tenders include:
Open Tenders: An open tender is a type of procurement where both private and government organizations can participate. Open tenders are a common way of advertising tenders to potential contractors and suppliers. Important information about the proposed works is included, to encourage interested parties.
Selective Tenders: Selective tender was developed as an alternative to the open tender procedure to address some of the limitations of the latter. This tender is designed to improve the quality of bids received while also ensuring that the contractors with the necessary expertise are given the opportunity to submit bids on time.
Closed tenders: These are only open to a select few suppliers who have been invited to bid. This is usually used when the work required is very specialist or sensitive.
Limited tenders: As the name suggests, this type of tender is only open to a limited number of suppliers, usually because the work required is very specialist.
Reverse Auctions: These are usually used for buying goods rather than services and involve suppliers submitting bids against each other to win the contract. The buyer will usually award the contract to the supplier who offers the lowest price.
Serial Tenders: Serial tendering is a hybrid tendering method that allows companies to compete for contracts by submitting multiple bids, but with the opportunity for negotiations between the bidder and the buyer. This competitive tender can be either a one- or two-stage process. This type of tender is typically used for clients who have a few related phases of work.
Negotiated Tender: As the name suggests, a negotiated tender is used largely in the engineering and construction industry. This is because these industries are subject to pre-contract and post-contract negotiations.
Team Tenders: This type of tender is typically used for large, high-maintenance projects. The contractor is asked to cover specific buildings or constructions at various locations. Tender is a time-limited process which allows suppliers to offer services that meet the specific needs of a client.
Now that you know what tendering is, you should be aware that there are a variety of ways to tender, used in different industries, from different sectors, including all public, private, and non-profit sectors. Tendering is a common process used in many different businesses and industries, but it is more common in certain areas. Tendering is a common way to get bids from different companies for work that needs to be done.
Currently, India has a well-organized e-tender process that ensures the task is done quickly and reasonably. Most institutions have a specific procurement procedure that is followed in a well-defined process and have fixed policies that direct the institutions on how to decide and which tender to accept.
BidAlert is an online tender information portal that provides brief information on various tenders in India and abroad, helping you make informed bids.