For those determined individuals who are looking to get involved in the process of bids and tenders, it means having a full understanding of how they work. This will make it much easier to become involved in this sector of business.
What is a Bid?
A bid is when a company gives another business, a proposal to complete a project. It is used for the company offering the bid to get new business or to attract repeat customers. Most often, a bid is placed on projects which have a starting point and an end date.
What is a Tender?
A tender is similar to a bid, and quite often the terms tender and bid are used interchangeably. It is not uncommon for the client to use the term tender, whereas the provider of the service will refer to it as a bid. Tenders are usually more applicable to an ongoing project which does not have a specific end date.
Difference Between Private Tenders and Public Tenders
Public tenders are those which usually involve the government. Most often, when governments have a project that needs fulfilling, they will put out a request for tenders. Then, companies that are capable of completing the project will put in their proposal. The government will then choose from those tenders submitted, according to the one that is best suited for them.
Private tenders are often referred to as supply chain tendering. These types of tenders do not work the same as the government ones. There are a lot more requirements and restrictions on government tenders.
Understanding the Terminology
Several standard terms are associated with this form of business, such as:
- Invitation to tender
Presented by a document, it outlines the basics of the project, and its requirements, by those who are submitting a tender. It will include the required qualifications.
Stands for request for quote. This is very similar to a tender on a much smaller scale.
This means a request for proposals. This document is not written as formally as how a tender may be. The scope of the work which is needed is not as detailed.
For those who are looking to get into responding to tenders, they have to know where to find them. The government tenders are easier to find, as they are open to the public, and are usually announced on specific government websites. Private tender is a little more complicated, and these are typically found in the supply chain database.
Preparing a tender takes some work and experience. Some companies hire professionals to do this for them. However, this is a process which can be learned, and there are plenty of resources that can help with this.