Factors considered in tendering decisions

Different companies might have different assessment values. Association of researchers in construction management, vol. Factors to consider when making employment hiring decisions. That is, the factors that influence the process may impact the outcomes. Adjudication is the process about getting the best possible bid price, during which contractors should consider number of factors.

Pdf key factors considered in compiling tender prices for. The construction sector is one of the key economic sectors and is the main force motivating. An objective decision must be made as to whether or not to bid for a tender. While these different types of buyers take their purchase decision in different ways there are 7 important factors that influence all the buying decisions. Contract strategy means selecting organizational and contractual policies required for the execution of a specific project. Basic guidelines for bidno bid decision making in the epc projects doi. International journal of construction supply chain management vol. According to the ciob 1983, this decision depend on the type of work under consideration, if the contractor has an appropriate experience in particular area and necessary resources to prepare documents and carry out the work. In the terminology of financial management, the investment decision means capital budgeting. A decision is needed to either explore it so use time and resources to prepare a bid or decline it in search for better options. Pdf factors affecting contractors bidding decisions for. How to identify risk factors in your project dummies. An investigation was made of risk emanating from risk factors as perceived by building contractors. The judgement process takes into consideration the different factors affecting tendering in a bid to arrive at an.

Factors influencing decisionmaking in a business environment. In practice, the decision whether or not to submit a tender depends on number of factors. But all markets are not equally attractive nor are the companies competent enough to pursue all markets. Factors considered in tendering decisions hy top uk contractors. The study has observed that, despite of being put into exercise for over eight 8 years, the tendering process at mohsw is ineffective due to the fact thatmonitoring of tendering process is a continuous process of ensuring that. These factors can be broadly classified as market related factors such as proximity to market, tangible or cost factors such as transportation availability, and intangible or qualitative factors such as environmental aspects. Introduction tendering stays one of the most popular means of selecting contractors to carry out construction works 1, 2. Influential factors in estimating and tendering for construction work. Except grouplevel factors, the traits of individual members and also the organizational context will shape the group decisionmaking. Other factors to consider when making your bidnobid decision include project location, duration, size and scope, competition, client and. Clients, factors, investigation, public buildings, tendering duration, nigeria i. Factors considered in tendering decisions hy top uk contractors, construction.

Key factors to consider in bidnobid decision making. Cost estimation, bidno bid decision, estimating accuracy, and cost overrun are the four main cost estimating issues mcei investigated by many previous. To examine the factors that influence public clients decisions for time allocation. Introduction according to adetola 2000, tendering is an invaluable aspect of project procurement or delivery system all over the world.

Factors considered in tendering decisions by top uk contractors, construction management and economics, 112. A questionnaire survey was used to identify and rank the factors affecting the bidding decision and then analyse them in terms of differences between the returned responses with respect to the differing respondent characteristics. Eastham 1987 identified 90 factors which are likely to affect the bid price. The judgement process includes the consideration of the different factors affecting tendering in a bid to arrive at an informed decision that would reflect positively on the organisation as a. Bidno bid decision guidelines bidnobid decisions in any construction firm are considered to be very difficult, but it may not be. It is not wise to quickly jump into responding to any tender that you come across. There are many factors that the contracting officer should consider in selecting and negotiating the contract type. The need for work, the number of competitors tendering, and the amount of experience on such projects are identified as the top three. Factors to consider before making right investment decision. Mukund seshadri the problem with the 21st century seems to be that of having too many options.

Here are some of the factors on which different human resources managers base their hiring decisions and what you need to keep in mind as youre considering each one. Valueadded services vas in the context of drug tendering are intended as a means to improve patient and overall health outcomes, as well as to give a competitive advantage to the manufacturer. Under such conditions managers need to make certain assumptions about the situation in order to provide a reasonable framework for decision making. On the other hand some contractors consider the internal and external factors associated with the bid decisions before committing for a project. The results indicate that several factors are considered equally important for bidno bid and markup size decisions. One of the critical decisions taken by contractors is whether or not to bid for a project. The results show estimator s risk factors as perceived to have the highest risk on cost estimates. Investigation into the factors influencing tendering. Other factors are seen to have considerable importance for one decision but not for another. This means that any improvement in bidding has the potential to enhance the industrys.

The judgement process includes the consideration of the different factors affecting tendering in a bid to arrive at an informed decision that would reflect positively on the organisation as a whole. Investigation into the factors influencing tendering duration. This study examines the factors affecting contractors decision to tender for. If a candidate was hardworking, highly motivated, and team oriented in his last. Decisions are made under uncertainty when the probabilities of the results are unknown. Making important decisions is a vital part of running a successful business. Individual, group, and organizational factors affecting group. Investment appraisal8 nonfinancial factors that every.

Most of the bid decisions are heuristic in nature and often contractors commit to a time consuming and expansive projects as the internal and external aspects are not considered. This is due to the complexity and uncertainty surrounding this decision, which is influenced by many factors. Pricing is often one of the most difficult things to get right in business. A risk factor itself doesnt cause you to miss a product, schedule, or resource target. Factors considered in bidding decisions by small and medium. To examine the factors obtained in order of importance or necessity. Understanding the factors that influence decision making process is important to understanding what decisions are made. Developing a decisionsupport system for making bid no bid and mark up size decisions will be of great help to contractors. Factors affecting decision making in business include alignment with strategic goals, external and internal data, opportunity cost, roi and the triple bottom line. Factors considered in tendering decisions by top uk contractors. The judgement process takes into consideration the different factors affecting tendering in a. This method of tendering is considered as the most common means by which the. Factors like financial record of the client, size of the project, scale and magnitude of the project and competitors in the current market played a major role in tendering decisions among contractors, as they were given higher importance. This study aimed at reveal factors effecting tendering process in public sector.

There are several factors a business needs to consider in setting a price. Factors to consider before making the right investment decision by. In its simplest terms, tendering is a formalised process for buying and selling. Dec 18, 2012 factors to consider before making the right investment decision by. Deciding whether or not to bid on a project is difficult because there are many objective and subjective factors that need to be considered. Factors affecting contractors bidding decisions for construction projects in nigeria article pdf available in journal of construction in developing countries 212.

Individual, group, and organizational factors of group bidding decisions. Wanous, m, boussabaine, a h and lewis, j 1998 tendering factors considered by syrian contractors. Investment decision and capital budgeting are not considered different acts in business world. It is generally believed that wrong bidding practice is a major contributor to the construction industrys inefficiency. The construction sector is one of the key economic sectors and is the main force motivating the palestinian national economy. Factors considered in bidding decisions by small and medium size contractors adnan enshassi and sami nayrab department of civil engineering, iug, gaza abstract. Factors considered in bidding decisions by small and. Chapter 2 contract strategy at the early stage of a project and once a project manager is selected, the main issue that faces the owner is to decide on the contract strategy that best suits the project objectives.

The assessment of factors affecting tendering in construction projects. The study has examined risk factors in cost estimation of building construction projects. Past experience the best indicator of a candidates future potential is past performance. Important evaluations before responding to a tender sa.

The relative market shares or market strength of competitors influences whether a business can set prices independently, or whether it has to. Basic guidelines for bidno bid decision making in the epc. There is no awareness of all the alternatives and also the outcomes, even for the known alternatives. The analysis considered four categories of risk factors.

The aim is to investigate how bidno bid decisions are influenced by different characteristics of contractors. Most construction projects are awarded on the basis of the lowest tender sum, although a number of other factors are considered in addition to. Download project materials in pdf and doc for final year students on eduprojects. Important evaluations before responding to a tender although bidding for a tender can be attractive, not all tenders will suit your criteria, experience and expertise. For construction contractors, it is not an easy decision whether to bid or not to bid for a new project. The only two factors that are rated as considerably important by a majority of colleges were overall gpa at prior. Bid decisions by contractors are complex due to uncertainty about many factors affecting their outcomes.

The bidno bid decision requires an understanding of a companys assessment in relation to factors affecting the decision. School of architecture and building engineering, the university of liverpool, p. In this context, vas are considered distinct from the elements typically included in health economic value assessments of medical technologies. Factors affecting contractors bidding decisions for. Last year i participated in a 12month coaching training program, and heres the most interesting thing i learned. Factors affecting bidno bid decision and their relative significance have been studied repeatedly worldwide, mostly by means of questionnaire surveys and interviews with representatives of the construction industry.

The different bidding situations together with the decision. The need for work, the numbcr of competitors tendering, and the. Pricing factors to consider when setting price business. Factors affecting contractors decision to tender the decision whether or not to tender for a project is a strategic decision requiring the consideration of the strategic intent, competency acquisition and longterm aim and objective of the contracting organization lowe and parvar, 2004. Some questions guided the data collection and analysis exercise. Bidding is the most common means by which contractors obtain work. Dec 01, 2009 investment appraisal is not all about financial factors. This paper aims to provide a better understanding of these decisions by examining the factors that affect bid decisions and consequently tries to give an insight of. The study aimed at evaluating the internal factors affecting procurement process of supplies in the public sector with specific reference to kenya government ministries. Individual, group, and organizational factors affecting. This paper sets to minimise the problems encountered during. Factors affecting the location decisions, assignment help. Key factors considered in compiling tender prices for chinas public.

The selection of location is influenced by a number of factors. Modeling contractors bidding decisions sciencedirect. Normally, effective price competition results in realistic pricing, and a fixedprice contract is ordinarily in the governments interest. Thus, group bidding decisionmaking is a multilevel phenomenon that must account for individual, group, and organization processes. The key to making better life and business decisions is actually pretty simpleyou need to ask yourself better questions. Decisionmaking involves a process by which a choice is selected from a number of options.

Investment appraisal is not all about financial factors. Factors to consider before making right investment. Bid decisions by contractors are complex due to uncertainty about. The selection of the most appropriate project for which to tender is fundamental to the commercial success of building contractors, and the decision to tender is complex, dynamic and often involves many factors.

The major purpose of this study is to examine the assessment of factors affecting tendering in construction projects. Everyone knows how much a good business relationship can help improve your chances of success when selling. Factors considered in tendering decisions hy top uk contractors,construction. Last updated by tony zemaitis, june, 20 may 29, 2019. The case of ministry of health and social welfare in ministry of health and social welfare. Rarely would there be a public project that has not gone through one form of tendering or the other. Capital investment decisions are not governed by one or two factors, because the investment problem is not simply one of replacing old equipment by a new one, but is concerned with replacing an existing process in a system with another process which makes the entire system more effective. Various factors are identified and then analysed in order to investigate their influence and relative. Be aware of time and operational and financial constraints. The index of both of these publications should be consulted as the theme is returned to in several other sections of these publications. The best leaders consider these 4 factors when making a decision. Contract strategy and the contractor selection process. May 28, 2019 making important decisions is a vital part of running a successful business.

Ayoti a research project report submitted in partial fulfillment of the requirements for the award of the degree of master of arts in project planning and management of the university of nairobi 2012. Case study of lagos state, get latest final year project topics with recent research materials and ideas in nigeria. Jan 04, 2017 while these different types of buyers take their purchase decision in different ways there are 7 important factors that influence all the buying decisions. It has become imperative for most companies to market their products and services outside their domestic markets. There are nonfinancial factors that plays significant role in making any meaningful investment decision. When a costreimbursement contract is being considered and all current or past experience with the contractor has been on a fixedprice basis. Various factors are identified and then analysed in order to investigate their influence and relative significance. Given the above challenge, this study aimed to uncover the critical factors affecting the contractors bidding decisions in saudi arabiabased construction projects. The construction industry accounts for approximately three quarters of the gross domestic product gdp in the country. Data was collected by use of questionnaires were a total of 61 questionnaires were administered to building contractors. How to identify risk factors in your project a risk factor is a situation that may give rise to one or more project risks. Transfer students, 2016 see table 9 the factors considered in transfer admission decisions are notably different than those for firsttime domestic and international students. In fact, most of those nonfinancial factors act as backbone that will either make or mare the investment if taken. Factors influencing the accuracy of precontract stage estimation of final contract price in new zealand.