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Tenders Blog
A blog covering tenders and advice on tender opportunities.
Monday 02nd August 2010
Understanding Tenders - A Tender Glossary
It is certainly important to know the meanings of various tender-related words and acronyms. Here we provide a mini glossary of some of the most commonly used ones:
 
Aggregation
Summing the value of individual contracts for the same supply contract or service.
 
Appraisal
The method by which tenders are assessed and judged. They usually need to meet a set number of pre-defined criteria.
 
Award
The successful issuing of an order/contract, subsequent to completion of the competitive tendering process.
 
Best Value
An initiative introduced by the government in 1999. The framework encourages local accountability and continual service improvement. The principles laid out make it clear that the obligation of best value applies to all local authority services – who can plan, measure, manage and improve their performance based on a set of indicators.
 
Call Off
A Call Off contract, which might be made following a formal tendering process, provides a defined range of works, goods or services covering terms and conditions (including price) which users can ‘call off’ to meet their requirements.
 
Commissioning
The process by which local authorities decide how to spend their money, in order to get the best possible services for local people. It involves assessing future needs rather than just considering present demands.
 
Framework
The Framework agreement is the overarching structure which defines all terms of the contract; covering such information as price and quantity. It is a general term for agreements with suppliers which set out terms and conditions, under which specific purchases or call offs can be made.
 
Guarantee Bond
An insurance guarantee whereby the supplier is guaranteed to be paid by the purchaser a fixed percentage (usually 10%) of the total contract value (should the deal fall through).
 
ITT
“Invitation to Tender”; the physical paper or electronic documentation issued to those invited to tender for a contract. It usually includes a background, contract specifications, rules of tender, questions or information required, and a draft contract.
 
KPIs
“Key Performance Indicators”; essentially, a method by which purchasers can measure the performance of suppliers with regard to their contractual obligations. KPIs are often detailed in the service specification document.
 
Negotiated Procedure
Adopted by high-value public sector bids, this procedure involves inviting selected suppliers based on specific requirements and possible solutions. It has limited use; for example in extreme urgency.
 
OJEU
“Official Journal of the European Union”; the frequently updated publication in which all high-value public sector contracts in the EU must be advertised. The average contents of a single issue of the OJEU include around 3,000-4,000 tender calls. It can be viewed in paper or online.
 
Open Procedure
A tendering process for some high-value public sector contracts, whereby suppliers can apply without prior selection. The usual selection stage and award stage are sometimes even combined into a single phase.
 
PQQ
“Pre-Qualification Questionnaire”; a series of questions designed to help buyers select only the most suitable bidders to invite to tender. Those who fail are usually excluded from further processes.
 
Restricted Procedure
In this form of tenders procedure, suppliers are selected by an open first-round invitation (such as a PQQ). Suppliers who then meet the required criteria, or ‘qualify’ in the eyes of the buyer, will be invited to tender. This is the most common type of tender for high-value contracts.
 
Selection Stage
The first real phase of any tendering process. After completion and assessment of the PQQ, it typically involves an appraisal of security, acumen and risk. It is sometimes called “shortlisting”. Those who succeed move onto the Award stage.
 
Tender
A written contractual offer for the provision of goods or services as precisely specified in the tender documents. Price or rate is specified, and a successful tender results in the award of contract to deliver the real goods or services.
 

 



Posted by: Admin, on August 02nd 2010 on 02:36pm
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Labels: tender glossary
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