Architecture / June 10, 2018 /
The contractor is selected on the basis of competitive tendering on most building contracts. The price which the contractor quotes for the job is heavily influenced by both the amount and intensity of the competition expected. In an open tendering arrangement the level of the competition is at its most intense and contractors must submit highly competitive bids to have any chance of winning the contract. This usually secures a rock bottom price. With selective tendering a limited number of competent contractors are invited to tender for the job, this limited competition arrangement results in a keen price being obtained. In the case of a negotiated tender there is no explicit competition and the parties seek to agree a fair price for the work, implicit competition exists, however, as the employer can break off negotiations. If there is no competition the contractor can, in fact, name his price. The tendering arrangement is, therefore, one of the most cost significant decisions a client will make in the course of a building contract.
All construction work is ultimately undertaken for the benefit of a client. Clients fund the construction process, whether they are individuals extending their homes, or a multi-national corporation developing a cutting-edge production facility, or a government department providing much needed social infrastructure. The importance of clients cannot be over-emphasized. Very often clients do not get the building they want, because they do not know how to ask for it and the architect or other consultants think the building should look a different way. Clients expect that the project will be a success and that the providers will deliver a competent service. They will be dissatisfied, if these expectations are not met.