The Tendering and Enquiry Process

Guidance Notes

Issuing Tenders and Enquiries

An enquiry is the process of asking a supplier to provide a quotation for fulfilling a business requirement. There are two methods of inviting a supplier to make such an offer: - (i) a request for a quotation

(ii) an invitation to tender (ITT)

The type of product being purchased and the volume and value should determine which method is used. The General Procurement Procedures provide the following advice:

<£1,000(incl. VAT) one written or verbal quotation should be obtained. >£1,000 and < £25,000 a minimum of 3 quotations unless there is clear evidence that competitors current prices are known and can be shown to be uncompetitive >£25,000 a formal tender with a minimum of 4 responses (except where less than 4 suppliers exist) >£144,459 EU regulations apply.

Quotations

1 There are usually two ways of requesting quotations:- (i) Verbally, by phone or in direct contact with a supplier. This is particularly useful for low value items but when ever possible should be confirmed in writing. Communication by fax or e-mail is preferable. (ii) Written enquiries by fax or by letter are more appropriate for higher value items and more complex purchases.

2 A minimum of 3 quotations should be sought for all purchases valued above £1,000 including VAT.

3 Enquiries should not be restricted to the same suppliers on each occasion. For recurring requirements a new untried supplier should replace any supplier who has on three occasions proved unsuccessful.

4 The following information should be included in any enquiry:-  Specification of the requirement  Quantity  Required delivery and start date  Method of reply  General conditions of purchase  Details of price breakdown (if appropriate)  Reply by date  Reply address and contact  Details of any product data(for hazardous products)

Issue 1 1 5 The University has General Conditions of Purchase that as a minimum should be used for all general purchases. Special terms are available for services, software and for large pieces of equipment. Should none of these be appropriate then special terms should be developed. Guidance on this may be sought from Strategic Purchasing.

6 All quotations received should be recorded on a summary sheet to enable comparison of cost price, discount, delivery cost, lead times and other elements of the quotation.

Where suppliers have provided quotations in different forms (e.g. cost per 1,000 rather than each) then all costs should be expressed at unit net level for ease of comparison.

7 The sourcing decision should be made on the basis of best value for money taking into account whole life costs, quality and availability.

Tenders

Tenders for goods or services potentially valued at £144,459 or more should not be undertaken without referring to Strategic Purchasing. EU regulations apply and whilst the details below are relevant special attention must be given to the method of advertising, the times scales permitted and the selection process.

1 Tendering is a more formal process used for high value complex purchases. It may take one of three forms:-

(i) Open tendering in which an advertisement is posted in the local or national press or in trade journals inviting qualifying suppliers to request tender documents. Where EU regulations apply then advertisements must be placed in the Official Journal of the European Communities (OJEC) prior to local advertising.

(ii) Restricted or selected tendering where a shortlist is drawn up.

(iii) Negotiated tendering where direct contact is made with the shortlist suppliers and negotiations are conducted to develop final bids. This is a particularly useful process where the specification is very technical and not entirely fixed. Under EU regulations, negotiated tendering is only permitted in certain circumstances.

2 The second form of restricted or selected tendering is most commonly used and usually involves the submission of sealed bids.

3 Large tender activities will often require site visits or pre-tender discussions to discuss the specification. No favourable treatment should be given to particular suppliers. All suppliers/ contractors should be allowed equal access.

2 4 The specific paperwork for each tender will vary depending upon the nature of the requirement, however, the following details should always be included:-  A letter of invitation  An acknowledgement enabling the supplier to confirm whether they will bid  Instruction on returning the bid e.g. contact details, address, reference number to be quoted.  A “form of tender” which should be signed and returned by the tenderer thus formally creating an offer of supply  The contract terms and conditions  Details of the validity period of the tender, usually 30 or 60 days but may need to be longer if the decision process may be extended.  The scope of the requirement or work  The specification and technical details  A “notice of intention to use subcontractors”  Details of any information required e.g. financial or technical data  Number of copies required  Deadline for submission, time and place.

5 It is important to allow potential suppliers time to respond taking into account both complexity of the requirement and the required start or delivery date.

6 Any supplementary information relating to the tender should be formally notified to all potential suppliers. This also applies when only one supplier makes a request for further information.

7 On receipt of sealed bid tenders the date and time should be recorded and the packets left unopened in a secure place until the appointed time for opening.

Procedure for Handling Sealed Bid Tenders

1 Extensions to closing dates should only be authorised under exceptional circumstances and all potential suppliers should be notified and be allowed to take advantage of any extension.

2 Late tenders should be left unopened and the supplier advised that the bid was received too late for consideration.

3 A tender board should be appointed to process the documents. This should comprise of a minimum of two people representing where ever possible both Strategic Purchasing and the User department. On larger contracts and when appropriate a third independent person may be co-opted.

4 At the appointed time tenders should be opened and a record made of all tenders submitted. A record should be kept of any irregularities or non-

3 receipts. Where there are simple price schedules, prices may be recorded at this stage.

5 A master copy of each tender should be checked for completeness, any changes with correction fluid ringed (to confirm that corrections were made prior to submission) dated and signed by two members of the tender board.