Qualifying Tenders

Tender Clarification Questions

Here is another common tendering dilemma. Should I ask tender clarification questions if I am uncertain about anything?

Tender Clarification Questions

Should I Ask for Clarification When Tendering?

Yes indeed! If you have areas of uncertainty, it is generally better to ask than have any ambiguity.

If your question is regarding the specification and you don’t clarify things you might price the tender incorrectly. Too high and lose. Or too low and win but make less profit.

Are you are unsure about the meaning of a question or evaluation method? Is it unclear or ambiguous? You might make the wrong assumptions and therefore respond incorrectly… and lose marks… and maybe lose the tender! So, ask for clarification.

Tenders often include a sample contract which cannot be changed post-award. If you have any concerns about the contract, ask before submitting your bid.

Some people worry that their question is commercially sensitive. Normally, you can ask to keep your question private if you feel that you will lose a competitive advantage. However, it might still be better to lose an advantage and gain full clarification. Weigh up the pros and cons.

Many people see the tendering process as an administrative task. But do remember it is just a formalised way of selling. If you are at a sales appointment you ask about anything you were unsure of. It’s the same with tenders.

Asking Tender Clarification Questions

Always double-check your question before asking. You don’t want to appear daft by asking about something that you have simply misread. Or is it answered elsewhere? Also, you don’t want to overload them with questions. So, choose carefully. For example, some things can wait till post-tender negotiation. You don’t need to clarify pre-tender.

In general, ask if you are unsure.

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Beware – Suicide Bidding! Tendering in Bad Economic Times

A tough economic climate can lead to an upsurge in suicide bidding – tendering at silly prices. Post-tender feedback during these difficult periods has highlighted some huge variations in bidders’ prices. This includes a significant proportion of bids at below cost.

Beware - Suicide Bidding! Tendering in Bad Economic Times

What is Suicide Bidding?

Suicide bidding is where a tenderer bids way below the market rate in an attempt to buy the business. This means their bid will make much less profit than the industry norm. But it may well be below cost! Either way, the bid offer will be unsustainable long-term. Resulting in bad service delivery, wrangling over invoices and loopholes. Or even going bust!

The reasons for buying business can be wanting to grab market share. But more commonly, during financial dips companies try and buy business to cover costs. Thus enabling them to retain their trained workforce and other resources.

Suicide Bidding Following the 2009 Recession

This worrying practice was demonstrated in 2010 by RICS in the construction industry. A survey of nearly 400 quantity surveyors showed contractors putting in bids below cost:

  • 20% of tenders submitted during 2010–11 were priced at a “sub-economic level”
  • Most suicide bids were 10% below cost but some were 40% under cost!

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