How to tender for construction contracts

The public sector relies on the construction industry to deliver the infrastructure needed to fulfil their social and economic objectives. From building schools and active travel routes, to repairing roads and improving existing buildings, the public sector publishes over 17,000 construction tenders a year. If you would like a chance of securing some of this work, whether it be outright or as part of a framework or DPS, then you will need to know what is involved in winning construction contracts. Below you will find details of how contracting authorities evaluate your bids, tips to improve your scores and information about your chances of success.

How are tenders scored?

There are two main components used to evaluate your bids – Commercial (pricing) and Quality (which often includes Social Value). The weighting of each component will be detailed within the tender documents and varies from contract to contract. Once each component has been evaluated, they will be combined to produce your overall score.

For the following examples, Price has a weighting of 55% and Quality has a weighting of 45%.

Pricing Evaluation

The method used to evaluate your pricing will be stated, however the most common option used is for the prices of each bid to be compared to the others. The lowest overall price will then receive a full score for price, while the pricing score for the other bids will be a proportion of this – calculated by (lowest price / other price) x Price weighting = Pricing Score.

Building BrixConstruction Crewe
Bid value£250,000£312,500
Calculation(£250,000/£250,000) x 55% = 55%(£250,000/£312,500) x 55% = 44%
(Maximum Price Score 55%)

For some projects you will find a maximum price has been set, and in these cases the contracting authority will have a good idea of what they are looking for.

Quality Evaluation

To evaluate the quality of your proposal, each of your answers will be reviewed independently of the other bids and allocated their own scores. Each question within the tender will have its own weighting to reflect the importance of that answer. Your quality score will be calculated by totalling the marks received for each of your answers and converting that to a proportion of the Maximum Quality Score.

QuestionWeightingPossible ScoringConstruction Crewe Score% Score
125%0-555/5 x 25% = 25%
225%0-544/5 x 25% = 20%
325%0-533/5 x 25% = 15%
425%0-522/5 x 25% = 10%
Score (Maximum Quality Score: 45%)---70% x 45% = 31.5%

Overall Score

Your overall score will be a combination of what you achieved for both the Pricing and Quality evaluations. From the above examples, Construction Crewe’s overall score is 75.5% - not a bad score, but not a great one either.

In these examples, not properly addressing the needs of the contracting authority weakened the bid and could cost them the work. Had these responses better met the requirements, Construction Crewe would have gained a higher score and may have also produced a more favourable price. While price did bring the score down, if you have carefully considered the price and aligned it to your offer, then that is the right price for your bid.

Other evaluation criteria

While the above criteria addresses what you will be scored on, there are other factors which determine if you will be permitted to bid for work.

  • Eligibility criteria

    Criteria should always be clearly stated and vary from tender to tender, read the documents fully to see if there is anything that would prevent you from being considered. Within construction tenders expect to see minimum criteria around your finances (including turnover) and insurance levels. You will also see criteria based on environmental standards, health and safety, relevant accreditations, and policies.

    Looking at document packs for other tenders could help give you an idea of what kind of requirements are being asked for.

  • Grounds for exclusion

    Exclusions are reasons not to be allowed to tender. They are generally relating to issues in the company's past. For example any criminal convictions, environmental breaches, conflicts of interest, bankruptcy etc. If you do not have any issues then there's nothing to worry about and its just a tick box exercise.

    You'll have to honestly represent your organisation, for most part this isn't an issue. For some of the areas it is possible to show 'self cleansing' actions which may be sufficient to allow you to participate.

  • Completion of requirements

    When you miss something that is required for the submission broadly one of two things will happen: 1. You will be disqualified from the process. 2. They will contact you and give you the opportunity to submit the missing documentation.

    Given that often missing something leads to disqualification, it is important to check you understand and comply with each and every requirement within the submission. It is important to work off a list to make sure everything is captured and have someone else double check all the requirements are completed in good time.

Not in the specification

With the introduction of the Construction Playbook and the Procurement Policy Statement, the government has put a greater focus on market engagement to ensure projects can fulfil their purpose and appropriate budgets are set. However, in some situations, it may be clear that the buyer has not fully considered their needs and you would have suggested they include additional requirements or an alternative solution altogether. When this happens, rely on your experience and offer what you think is needed.

However, in some situations, it may be clear that the buyer has not fully considered their needs and you would have suggested they include additional requirements or an alternative solution altogether. When this happens, rely on your experience and offer what you think is needed.

How to win construction contracts

With the evaluation criteria detailed above, you now know what is involved in making procurement decisions, but may be left wondering ‘How do I achieve high scores?’ If we were to offer you a guaranteed formula for how to tender for construction contracts and win, we would be lying. Sometimes there will be companies who can offer a better service or price, but in the instances where you deserve to win the work - we can offer you are some useful tips to really make your submissions stand out.

Be pragmatic

Consider the evaluation criteria above, what you can offer, the level of work you can take on, and your overall ability to deliver the work.

Have a pricing strategy

A price should only be decided once you know what your offering will be, and not the other way around. Your price needs to be competitive while also ensuring there is scope to make suitable returns – which is not possible if don’t give your pricing the time and contemplation it deserves.

Pay Attention to detail

One of the main causes of negative feedback from buyers is not answering the questions correctly or providing everything that was required. You need to fully understand what is being asked of you, and then ensure that everything the buyer has asked for and needs, is covered clearly within your proposal.

Manage your time effectively

IIf you rush your bid, you cannot effectively pay attention to detail, and the overall quality of your bid will suffer. Set deadlines and always ensure you have a realisitic amount of time available.

Leave time to review

Having time dedicated to reviewing spelling, checking all documents are included, and that all requirements have been addressed, can help you catch mistakes that would otherwise cost you the contract.

Plan your responses first

All of this advice is only useful if you have a clear plan for how you plan to approach your bids. If you don’t have a plan, how can you track your time, monitor progress, or ensure you have the resources required for on time completion. You can find a basic structure for creating bid plans in ‘Planning Your Winning Tender Submission’.