Tender Evaluation Process
So you’ve written the tender and you’re waiting on the award. But do you know how the buyer evaluates the submitted tenders?
According to CIPS (the Chartered Institute of Procurement and Supply), the main objective of the tendering process is to:
“ensure the “best fit” supplier is selected to supply goods and/or services to the customer which offers the best value for money. Such a supplier is likely to be sound commercially, technically competent, financially sound and perceived as best for the task.”
This means that the buyer holds a competitive tender evaluation process to ensure they are getting the best service or product from the best possible company.
MEAT
The Most Economically Advantageous Tender (MEAT) is a common evaluation process that buyers use as the selection procedure for publicly-procured contracts. It allows the contracting party to award the contract based on aspects of the tender submission other than just price.
MEAT was introduced by the European Parliament as part of public procurement rules that apply to any contracts for public spending above minimum values. In the UK these are known as the Public Contracts Regulations.
MEAT evaluation means the buyer evaluates other aspects of the service or project to be delivered as well as the cost. These can include:
- Quality
- Technical Ability
- The proposed Design
- Accessibility
- Social Characteristics
- Environmental Benefits
- Innovation
- Customer Service or ongoing support
- Ability to Deliver on time.
Each separate aspect can be evaluated by the Client on its own or in a mix with other considerations.
You can head over to our sister company ‘Tender VLE’ to see further information on how buyers ‘source the MEAT’.
Scoring
When you’re writing bids you should be aware of the Invitation to Tender which will let you know how your submission will be scored.
It is normal for each question to be evaluated individually and awarded a score between 0 and 10 based on how well the response meets the buyer’s expectations.
Be aware that the buyer might reserve the right to throw your tender out if you fail to meet minimum evaluation standards throughout the scoring process.
Commonly a score of less than 5/10 will mean your tender is rejected immediately. This evaluation method is used to help the buyer shortlist quickly.
Mandatory Responses
The same can be said for any ‘mandatory’ requirements the buyer might have. Before you submit your bid, you should make sure you respond to every mandatory question within the tender documents. Failure to do this will mean the buyer can reject your application without having to evaluate it.
Evaluation Process
Evaluation criteria will be different for every bid. It will change depending on the nature of the role or project to be delivered, who the buyer is and what their priorities are.
Each evaluation criteria is given a weighting depending on how important that consideration is to the buyer.
Once submitted, each tender may be evaluated by more than one person on a panel. Alternatively, every panel member may score each submitted tender against one evaluation criteria.
The overall score for submission can be calculated by multiplying the score by its evaluation weighting and adding together or averaging the results for each assessor. Where there are differing scores between panel members, a meeting will be held to reach an agreed decision.
Pre-Qualification
You may have had to pass a pre-qualification questionnaire (PQQ) process before you get to this stage.
This is often used for complex projects and helps the buyer shortlist all those interested in winning the contract to those who are genuinely appropriate to deliver it.
The way that this first stage is evaluated is commonly against a set of Pass or Fail questions.
Examples of this include:
- Having insurances above a minimum limit
- Having an Environmental Policy
- Having recognised quality accreditations (for example ISO 9001 or CHAS accreditations)
Often this first stage of evaluation will be fairly simple to complete, often with smaller word limits than second stage evaluations and the information you need to provide is relevant to the works being completed.
This is used by the buyer to evaluate your company and check you are able to deliver the works.
Learn more about PQQs on our Tender VLE site.
Evaluation Tools
If the buyer is evaluating a tender and is unsure about a certain part of the response, they can ask clarification questions. This means they can ask you for further information regarding any part of your bid.
Other processes for Evaluation
Best Value
Sometimes the buyer wants to evaluate the tenders received to determine which contractor can provide the best value for money over the life of the project. Prospective clients are evaluated against a pre-determined set of criteria. These include:
- Cost to complete the works
- Previous experience delivering similar works
- Company Sustainability
- Management Systems
How the buyer sets the scoring and evaluates each tender response gives them an accurate representation of how each bidder provides whole life cost. The supplier achieving the best score may then be selected.
Auction Theory
This process of evaluating tenders through a range of auction style bids including:
- First Price Sealed Bids
- Second Price Sealed Bids
- Open Ascending Bids
- Open Descending Bids
Auction theory has gained a bad reputation historically. There is a lot of risk for the contractor to price their tender in a way that gives them little or no profit because the buyer can drive the price down intentionally.
Balanced Score Card
This process of evaluating cost against more complex features of a proposal such as socio-economic considerations. This is a process that Government departments are encouraged to use when designing major works above £10million.
Some examples of this include:
- The Olympic Delivery Authority for London 2012
- HS2 Rail
- Heathrow Terminal 5
How this is evaluated is as follows. All buyers must:
- Consider each of the critical success factors and strategic themes in the evaluation to make sure they have considered all requirements.
- Produce a specific scorecard so that all tenderers are aware of all project requirements
Remember; however the buyer chooses to host the procurement and evaluation process, they’re always after the same things.
The best fit supplier, to deliver the best works or service, for the best price.
Support
If you feel you need Bid Management support or more information about tender evaluation processes or how to write winning bids, contact our consultants for specialist advice. Or visit our free virtual learning environment, Tender VLE.
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