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How to read Standard Bidding Documents like a Pro
TenderingClaris Zimbiti | Oct 02, 2024 | | | |
Need a winning proposal or bid for a government contract ASAP?
Take a moment to learn to read and understand Standard Bidding Documents first.
Why?
Because Standard Bidding Documents are the core of any tendering process.
If you are new to tendering for government contracts, standard bidding documents can be confusing.
If you don't read or understand all of the information given, your bid could get a lower score and you could miss important points that could affect the price or even cause you to miss out on an opportunity
In this blog, I'm going to show you why standard bidding documents are very important and their purpose to you as a bidder.
I will also discuss how they are structured and the information that is included. This will make it easier for you to read and understand these documents so you can get ready to win your next project.
Table of Contents
- What are Standard Bidding Documents( SBDs)?
- Reasons why Standard Bidding Documents were created
- What is the purpose of Standard Bidding Documents?
- How are Standard Bidding Documents structured?
- Wrap Up
What are Standard Bidding Documents( SBDs)?
These are documents used in formally inviting or calling upon providers to make offers for the supply of goods, services or works during the tendering process.
They are usually used by public sector or government organizations to present requirements for a particular procurement.
They are sometimes referred to as Tender Packages, or Solicitation documents.
The thing is purchasing complex solutions in a professional environment is a lot more complex. So SBDs are used to communicate the needs and requirements for a particular project.
And typically, there are three key pieces of information involved:
- Instructions and information on procedure for submission of bids
- Description of goods, services or works to be done
- Conditions of contract
Reasons why Standard Bidding Documents were created
Bidding Documents are a set of documents that all prospective bidders must adhere to when submitting their bids. They were originally created to facilitate communication and transparency in the tendering process. Let’s look at these two reasons in detail:
Communicating relevant information with clarity
When it comes to the tendering process, there is a lot of information that has to be shared with potential bidders.
SBDs serve as a tool for communication that helps bidders like you understand what is expected of you in terms of price, quality, and deliverables.
This helps ensure that everyone involved in the process has clear expectations about what needs to be done.
Make sure that contracts aren’t warded under the table
All activities and choices made in accordance with the public procurement policy must be made in an open and transparent manner.
This means that any contractor, supplier, service provider, or consultant who wishes to participate in a public procurement process must be provided with all information necessary to do so. Every interested bidder must be able to determine if they are qualified to compete.
These solicitation documents serve as a transparency tool that makes it easy for anybody to see what is being purchased, when it will be delivered and what rules apply to the bidding process.
This eliminates any room for ambiguity and gives all bidders an equal chance of winning
What is the purpose of Standard Bidding Documents?
Set the rules of the competition and the procedures that must be followed when bidding
The tendering process is a multi-staged activity and requires a thorough understanding of each stage in order to be more successful with bids. Each step has its own set of rules and procedures to follow.
For example, if you miss the submission deadline, then you are disqualified. Your bid is returned to you unopened. If you fail to submit all the required documentation then you are disqualified. If you fail to sign the Bid Submission Form, then you are disqualified.
So, you have to figure out the rules for the following procedures:
Outline Scope of the Project
The most important part of a bid is the scope of work.This is the description of the work that you will perform for the project. It provides information about what needs to be done, how it will be done, and the scope of each project stage
For example if you’re bidding on a complex project that requires some specialized knowledge or skill set, it’s important to understand the scope of work. This helps you determine the level of effort required and estimate how much it will cost to compete.
If your company is bidding on a project you have never done before, knowing the scope of work helps you figure out how much experience, tools or materials you need to do the job right.
So, depending on the type of procurement, here are some things to find out from the SBDs:
Outline Conditions of the resulting contract
Contracts have different types of risks which affect your cash flow and how much money you make. A contract in its basic form outlines how you are going to be paid. So, it is important for you to pay attention to all the essential terms and conditions of the contract before submitting a bid.
The most common types of contracts are:
1. Fixed Price Contracts- These contracts have a fixed price for completion of all outputs and are usually paid on contract completion.
2. Cost Plus Contracts- These contracts involve regular payments based on the total costs you've incurred over a certain period of time. These payments aren't usually tied to output.
Plus, you will get either a fixed fee or a percentage of the profit over the cost price.
3. Time and Materials Contracts- With this type of contract, you get paid for the materials you use and the amount of time (days or hours) spent on a project.
So, here are some of the legal aspects you need to find out from the Conditions of Contract
Now, let’s take a look at how a Standard Bidding Document is structured to help you to better understand it better.
How are Standard Bidding Documents structured?
Now you might be wondering. What information is included in the solicitation documents?
A bidding document is basically divided into four parts. Now, let’s look at these parts in detail:
Part One: Standard Invitation to Bidders
This is the first section, where you'll find the basic letter inviting you to bid
Part Two: Bidding Procedures
This section tells you how to prepare your bids and how the bidding process will be carried out, from opening the bids to evaluating, selecting, and awarding of the contract to the winner.
It is referred to as "Instructions for bidders" (ITB) and "Bid Data Sheet".
This part has three elements: instructions for bidders, evaluation criteria and bidding forms.
The evaluation criteria is one of the most important aspects to keep an eye on as a bidder.In case you might be wondering what the evaluation criteria is. Evaluation criteria is just the system they'll use to score marks on your bids.
It gives you clues about what the customer cares about and how that will affect their decision.
Most of the time, government clients will tell you in your proposals how they want you to present your information.
They do this so that your proposals are easy for them to understand and easy to evaluate.
Because of this, they give you Bidding Forms.One thing to remember is that you have to fill out these forms. If you don't fill these out, you will be disqualified.
Part Three: Statement of Work
This is the heart of the RFP or Tender. The purpose of the Statement of Work (SOW) is to explain what the bidder is expected to do, how the bidder should perform, and where and when delivery or performance should take place.
Or, to put it another way the SOW is like a story about the project. There are three parts to a story: the beginning, the middle and the end.
The beginning is the background of the project, the middle is the actual scope of the project (work to be done) and the ending are the deliverables and the KPIs.
The work scope needs to be clear, unambiguous, and easy to understand. If the work's scope isn't clear, it’s better to raise a clarification.
Clarifications are questions that you have concerning the bid. So what you do is you send your questions to the contact person specified in the bid. And it’s usually the procurement officer.
And the contact person will respond to your questions via email. This information is also sent to every bidder who has expressed interest in the bid.
Part Four: Contract Conditions
This section includes conditions that govern execution of the Contract.
When assessing the contract conditions, you should look at the contract features, the type of project, the contract's risks and the benefits and drawbacks of the agreement.
The two types of information provided are:
1. General Conditions of Contract (GCC) - are standard conditions for a typical contract
2. Special Conditions of Contract (SCC) - includes provisions that are specific to each contract.
Now, this is one of the sections that is neglected by many bidders.
Like I said before, every type of contract has risks that you, as the bidder, must take into account. These risks can affect your cash flow, your profits, or contract performance.
So you should pay very close attention to this part.
Wrap Up
Sometimes the small things matter the most when it comes to winning bids. Standard Bidding Documents have all of these little details.
Even if it seems unimportant, you should never underestimate how important it is to read and understand bid documents.
At the very least, you should read, analyze, and map all of the documents' requirements. It can be time consuming but is well worth it.
Before putting anything in writing, be sure to read the standard bidding document carefully.
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