Unit - 8
Tender
Q1) How to prepare tender document?
A1) Preparation of tender documents:
The various terms and conditions of contract which are able to be formulated while inviting tender for civil engineering work are:
(a) The Notice Inviting Tender (N.I.T.) is standard approved from of a department.
(b) Tender form with standard conditions of contract.
(c) Schedule of quantities of works to be done and materials, tools and
plants to be supplied by the department if any.
(d) Special terms and conditions.
(e) Complete specification of the work, to be executed.
(1) Special specification and additional condition of contract.
(g) One set of approved drawing where necessary.
(h) All the above documents are signed by contractor page by page, necessary entries are made and a forwarding letter on letter head of contractor with bank draft are put in closed cover.
All the above documents are signed by contactor page by page, necessary entries are made and a forwarding letter on letter head of contractor with bank draft are put in closed cover. The cover is then sealed and dropped in the tender box within the time limit for tender. The name of the work and the name of the contractor are superscripted on the cover. Before inviting any tender, the detailed estimate of the work which shows the quantities of all works to be done, their rates and total amount along with the specifications to be adopted is to be prepared and sanctioned.
Q2) What is tender? Importance of inventing tender.
A2) Tender:
Tender is written offer submitted by the contractors for carrying out the work or executes the work given in the notification or supply of some specified articles or transport of materials at certain rates with the terms and condition laid down in the tender document.
The form in which it is said to be submitted is supplies by the department eligible contractors on usual payment of cost,
The tender duly filled in is placed in the tender box with locking arrangements kept in the room of the offer inviting tender on or before specified hours and date notified through the tender notice PWD form.
Importance of Inventing Tender:
Invitations to tender are frequently utilized by public zone organizations that are legally obligated to provide contracts for items or carrier necessities via way of means of that procedure in lots of countries.
In an open invitation to tender any dealer who can offer assure of overall performance can also additionally provide.
To request bids for a plan or to understand a professional provide consisting of a takeover bid.
Tender also normally refers to the technique wherein governments and monetary establishments request bids for huge tasks that need to be provided inside a confined time limit.
Q3) Explain item rate contract with advantages and disadvantages in detail.
A3) Item rate contract:
It is also called as unit-price contract or schedule contract.
For item rate contracts, it is important that contractors are required to assign rates for individual item of works on the basis of schedule of quantities.
This schedule indicates full nomenclature of the items as per sanctioned amounts estimates, estimated quantities and unit therein.
The final total of the amount tendered for the work is also drawn up by them.
This type of contract is generally followed by railway department.
1) The basis of this type of contract is the item wise rate offered by contractor.
2) But item wise amount which is calculated by contractor by multiplying the quantity of each item with rate may be incorrect sometimes such incorrectness may be provided by contractor in his own interest.
3) As the quantities may be rising or decreasing, a contract of his nature requires careful consideration by engineer before it is entered into, as by wise anticipation or perhaps outside information a contractor may quote high prices for items that are likely to be required in the increased quantities and low prices for items likely to be decreased or required in small quantities.
4) Comparative statement of item rate tenders is more elaborate and comprehensive so it requires intelligent scrutiny
Q4) Explain lump sum contract in detail.
A4) Lump sum contract:
A lump sum contract is the traditional means of procuring construction, and still the most common form of construction contract. Under a lump sum contract a single lump sum price for all the works is agreed before works begin.
The departmental schedule rates for various items of work are also provided which regulates the payment of contractor in respect of items of work involved for any additions and alternation not covered by original work.
1) It has advantaged that owner knows beforehand exactly what the work will cost.
2) In terms of additions and alternations detailed measurements of the work done are not required to be recorded.
3) Since, difficulty arises in making intermediate payments to a contractor he tries to complete the entire work as quick as possible to get early payment resulting quick completion of the work.
1) Under such contract it is essential that the work be accurately and completely shown on drawing and described in the specifications and that full information as to site conditions should be available, otherwise dispute can arise simply.
2) Difficultly arises in making any intermediate payment, generally a certificate is given by responsible officer to the effect that by superficial or general measurement, he has satisfied himself that value of work is not less than specified amount in conformity with contract agreement.
3) Although often used in conjunction with schedule of pries, it is not suitable form of contract where considerable additions or variations are expected or contemplated.
Q5) Explain cost pulse percentage rate contract in detail.
A5) Cost pulse percentage rate contract:
In tendering for work on "cost plus" basis the contractor is paid the actual cost of work, plus an agreed percentage in addition, to allow for profit.
This type of contract is generally used when conditions are such that labour rates and materials rates are liable to vary.
In adopting this system of tendering no "Bill of quantities" of "schedule of rates" has to be framed but the owner or the department should carefully define the actual cost and record exactly what is exactly permissible in the cost of work.
Q6) Explain prequalification in detail.
A6) Prequalification:
1. Prequalification of tender:
Prequalification is the first stage of the tender process. The Territory intention is to only deal with prequalified suppliers where practical, and hence prequalification provides potential access to tender opportunities which are not available to suppliers who are not prequalified.
2. Prequalification of contractors:
The successful execution of contracts for large buildings, civil engineering, supply and installation, turnkey, and design and -build requires that contracts are awarded only to firms, or combination of firms, that are suitably experienced in the type of work and construction technology involved, that are financially and managerially sound, and that can provide all the equipment required in a timely manner. The assessment by an implementing agency of the suitability of firms to carry out a particular contra ct prior to being invited to submit a bid is a process called prequalification.
Prequalification is followed by a closed competitive bidding procedure in which only those firms meeting specified prequalification criteria are invited to submit a bid. Prequalification should not be used for limiting competition to a predetermined number of potential bidders. All applicants meeting the specified criteria shall be allowed to bid.
In this process, the financial stability and competency of contractors is determined before the tenders for the work are invited.
After contractors are prequalified, the tender’s forms are supplied to the only eligible contractors who possess requisite qualification of the job. The contractors are classified based on their financial status and technical capability.
Before 6 September 1982 the contractors were classified as A. A, B₁, B, B₁, C, D and E but after 6 September 1982 they are classified as I, II, III, IV, V, VI and VII.
Contractor has to send standard application form giving all detailed information regarding his part experience of carrying out same works on hand at present, financial status, qualifications, tools and plants and equipment available for executing work.
Q7) Explain advantages and disadvantages of prequalification
A7) Advantages:
Disadvantages:
Q8) Explain general and special condition for tender in detail.
A8) General and Special Condition:
Government has their own standard conditions of contract provided in printed tender form. These are as follows:
Q9) What do you mean by termination of contract and extra work charges in detail.
A9) Termination of Contract:
In case of contractor fails to prorate progress of work or let the contracts for reasons best known to him
In the event the contractor failing to complete the work within stipulated period.
If the contractor: 1. Assigns his contract or trying to do so 2. Becomes unable to pay one's debts
If contract is found carrying out the work not in accordance with contract drawings specifications of engineer to supply enough skilled workmen and specified materials or fails to make good defects in work in spite of receiving notices from the engineer as per representative of employer to the effect. A contract may also be terminated by employer due to change of policy, non availability of work site or any other administrative reasons before starting the work. A contract may be terminated with free consent from both the parties. To terminate a contract registered notice is served on contractor framing charges against him for violation of clause or terms and conditions of contract allowing fixed time usually 7 or 14 days. In case contractor fails to defend himself or notice remains wire plied the contract can be terminated by the owner.
Extra Work and Changes:
The items of works are not included in the accepted tender are to be sanctioned by and paid for by the executive engineer, subjected to following limitations:
The amount of each such extra item should be within the amount up to Rs. 10,000/
The total cost of all such extra items should be within the amount up to which the executive engineer is empowered to accept the tender.
The rate of extra item, which is fairly comparator with any similar item already included in the accepted tender, should be decided by the executive engineer after convincing the contractor.
The work of extra item should be carried out by contractor after receiving formal written orders from engineer-in-charge of work
The rates of extra items are subjected to careful scrutiny by divisional account of division before they are sanctioned and paid by competent authorities.
Q10) Explain penalty and liquidity charges and payment of advance.
A10) Penalty and Liquidity Charges:
When the quantity constant is greater than the real loss incurred, its miles known as a penalty however a quantity that could be a pre-estimate of the loss is known as liquidated damages. The penalty is an exaggerated quantity to discourage the events from defaulting.
A penalty clause is phrases of contracts that are seeking for to impose a responsibility to pay an amount of cash within side the occasion while any of the events breach the contractual phrases. The quantity of penalty commonly exceeds the quantity of damages that would be sustained with the aid of using the contracting events. For these reasons, in lots of jurisdictions penalty clause isn't always enforceable because of public coverage as though its miles enforced then the party might also additionally make the most of the breach of settlement with the aid of using every other party
When the quantity constant is greater than the real loss incurred, its miles known as a penalty however a quantity that could be a pre-estimate of the loss is known as liquidated damages. Liquidated damages are a real estimate of the loss.
Before entering into a contract, the parties stipulate a sum of money which has to be paid by the one who has breached the contract to the other party who has been aggrieved and this sum of money is termed as liquidated damages.
Payment of Advance:
Such payment is made on running account to contractor for work done by them but not measured. Certificate printed on R/A bill is to be signed by the Sub-Divisional officer. The lump sum amount to be paid on the account of several item is specified against item of part III of the bill. The advance is adjusted to subsequent bills in which actual measurements have been taken.
Q11) Explain what is settlement of disputes?
A11) Settlement of Disputes:
In the context of creation contracts, a Dispute Board (DB) accommodates a board of 1 or 3 persons, impartial of the contracting events, engaged to carry out an outline position of the execution of the undertaking and the agreement. Its number one characteristic is to help the events to keep away from disputes if feasible or if not, to help them to a speedy, cost-powerful and appropriate decision of disputes, and keep away from the want for arbitration or litigation. The participants of a Dispute Board want to be relevantly skilled within side the sort of undertaking below creation, and feature an intensive know-how of contractual problems. They want to be reputable for his or she enjoys and expertise and those they ought to be impartial. Both contracting events ought to agree on club of the DB.
The best Dispute Boards are prepared on the begin of the agreement, and earlier than creation begins. The Board is supplied with the agreement documents, plans and specifications, and is supplied with normal development reviews in the course of the route of the undertaking.
Thus, the Board participants end up and stay acquainted with the agreement, the undertaking and the members from the beginning, and feature an updated understanding of all of the applicable problems which would possibly affect on capability disputes.
The goal of the Board’s web website online conferences is to ciliate verbal exchange with the contracting events, and encourages decision of contentious problems on the task level, earlier than they end up real disputes. With the acquiescence of each event, it may offer a casual advisory opinion on a capability dispute.
Either celebration has the proper to refer a dispute to the Dispute Board. Following any such referral, the Board will maintain a hearing, query witnesses, recollect submissions after which offer a reasoned dedication of the dispute, all inside a described constrained time.
The contractual impact of the Boards dedication relies upon on whether or not the Dispute Board is a so-called "Dispute Resolution Board" (DRB), or a "Dispute Adjudication Board" (DAB).
Q12) What is R A Bill and Final Bill.
A12) R. A. Bill and Final Bill:
1. R. A. Bill:
It is a part of payment or payment on account of your compensation, which is made in advance of any final settlement. The amount that you accept as an interim payment will be subtracted from total sum payable by the defendant at end of your ease. Once you have calculated your interim payment you can't change back to the standard option for the complete year. You can re-estimate as many times as you like, until your final interim payment date.
2. Final Bill:
Final bill is to be made within three months from the date of issue of certificate of final completion. Following points are to be considered while preparing final bill as follows:
Q13) What is insurance, claim and price variation.
A13) Insurance:
Insurance is a contract, represented via way of means of a policy, wherein a character or entity gets monetary safety or repayment towards losses from an insurance business enterprise. The business enterprise swimming pools customer dangers to make bills greater less costly for the insured.
Insurance there are four types:
Home insurance
Motor insurance
Travel insurance
Health insurance
Claim:
Estimation of high-quality claims is a critical a part of actuarial paintings in widespread coverage. Due to the character of widespread coverage contracts and the declare agreement process, most of the not unusual place actuarial strategies for estimating the fee of high-quality claims contain extrapolation of a two-dimensional improvement triangle. The row or vertical size of the improvement triangle is typically the twist of fate 12 months or underwriting 12 months, and the column or horizontal size is the put off among the twist of fate 12 months (underwriting 12 months) and successive valuation dates.
Price variation:
Price variance is the real unit price of an object much less its well-known price, expanded with the aid of using the amount of real devices purchased. The well-known price of an object is its anticipated or budgeted price primarily based totally on engineering or manufacturing data.
Price variance is the real unit value of a bought item, minus its well-known value, improved with the aid of using the amount of real gadgets bought.
Price variance is an important aspect in finances preparation.
A rate variance suggests that a few expenses want to be addressed with the aid of using control due to the fact they're exceeding or now no longer assembly the predicted expenses.
Q14) Explain preparing bids-bid price buildup in detail.
A14) Preparing Bids- Bid Price Buildup:
1. Preparing Bids:
Bidding files are files issued via way of means of the Procuring Entity to offer the potential bidders all of the vital data that they want to put together their bids
The objectives, scope and predicted outputs and consequences of the proposed settlement
The predicted settlement duration
The obligations, responsibilities and capabilities of the triumphing bidder
The minimal eligibility necessities of bidders, along with music document to be decided through the Head of the Procuring Entity.
The following ought to take part within side the preparing of the bidding documents:
2. Bid – price buildup:
A bid fee or price is a fee or price for which any individual is inclined to shop for something, whether or not or not it's a security, asset, commodity, service, or contract. It is colloquially called a “bid” in lots of markets and jurisdictions
The bid rate is the best rate a purchaser is inclined to pay for a protection or asset.
A bid rate is normally arrived at thru a system of negotiation among the vendor and an unmarried purchaser or a couple of buyers.
The distinction among the bid rate and ask rate is called the markets spread, and is a degree of liquidity in that protection.
Q15) Explain materials, labour, equipment cost, risk, direct and indirect overhead in detail.
A15) 1. Materials:
1) Rubbles or stones: The stone shall be uniform texture color. It should be hard, sound and durable. Round surface stones shall not be used.
2) Cement: Cement shall be fresh, ordinary port la cement confirming to IS 269-1958. Cement should check and subjected to test if found doubtful.
3) Sand: Sand shall be of standard specifications clear from dust and organic matters. It should be well grade and sized, consisting of hard sharp and angular grains. I shall be perfectly dry to avoid moisture content in it.
4) Water: Water Drinking water shall be used for construction work.
2. Labour:
Skilled labour should be used for different purpose, For RCC, work labour should know the steel reinforcement used in it. Proper sand cement ratio, using well graded sand this requires a skilled labour.
3. Equipment cost:
Wherever possible the cost of equipment and ordinary T and P those are required for general use should be assign to specify item of rate.
4. Risk:
Risk is defined as any seen or unseen uncertainty on the construction project which changes the project planned attributes like completion time, estimated cost etc.
Risk is something by which a contractor can identify potential threats in completion of construction project to avoid delay in successful completion of project.
All construction projects are unique in their characteristics.
For execution of same type of residential building on two different locations the kind of problem come are may be same or different. If we go through construction project life cycle then we can find the construction project is full of risk.
Direct and Indirect Overheads:
1. Direct cost:
The costs and expenses that are accountable directly on a facility, function or product are called as direct costs. In construction projects, the direct costs are the cost incurred on labor, material, equipment etc. These costs for a construction project are developed as estimates by means of detailed analysis of the contract activities, construction method, the site conditions, and resources. Different direct costs in construction projects are material costs, labor costs, subcontractor costs, and equipment costs.
2. Indirect cost:
The unlike direct costs are not directly accountable for a particular facility, product or function. Indirect costs can be either variable or fixed. The main sections coming under indirect costs are personnel costs, security costs, and administration costs. These costs do not have a direct connection with the construction project.
Q16) Explain the various bid condition in detail
A16) Bid Condition:
1) Purpose:
The cause of those specs is to require the furnishing and transport of the best services and products according with the specs. These documents, and any next addenda, represent the whole set of specification necessities and bid reaction forms.
2) Governing Laws and Regulations:
Any agreement issued due to this RFB will be construed to the legal guidelines of the State of Kansas. Additionally, the contractor shall observe all local, state, and federal legal guidelines and guidelines associated with the overall performance of the agreement to the quantity that the equal can be relevant.
3) Taxes:
The contractor shall count on and pay all taxes and contributions which includes, however now no longer restricted to, State, Federal, and Municipal which might be payable via way of means of distinctive feature of the furnishing and transport of the objects specified. Materials and offerings furnished via way of means of the College aren't concern to income tax and can be waived for the widely wide-spread contractor.
4) Preference for Kansas Firms:
In accordance with College policy, choice will be given to Kansas merchandise, materials, offerings, and corporations whilst the products or offerings to be supplied are similarly or higher applicable for the supposed cause and may be acquired without extra cost. Firms are considered “Kansas corporations” in the event that they preserve a normal place of work within side the State of Kansas.
5) Equal Opportunity and Non-Discrimination:
In reference to the furnishing of merchandise and/or offerings be neat the agreement, the contractor and all subcontractors shall agree now no longer to discriminate in opposition to any recipients of offerings, or personnel or candidates for employment on the premise of race, color, religion, countrywide origin, sex, age, disability, or veteran status. The contractor shall observe federal legal guidelines, regulations, and guidelines relevant to subcontractors of presidency contracts which includes the ones regarding same employment of minorities, women, humans with disabilities and positive veterans. Contract clauses required via way of means of the US Government are integrated herein via way of means of reference.
6) Applicable Laws and Regulations:
The College serves occasionally as a contractor for the US Government. Accordingly the company of products and offerings shall observe federal legal guidelines, regulations and guidelines relevant to subcontractors of presidency contracts which includes the ones regarding same employment possibility and affirmative motion within side the employment of minorities women humans with disabilities and positive veterans contracting with enterprise worries with small deprived enterprise worries Contract clauses required via way of means of the Government in such situations are integrated herein via way of means of reference.
7) Insurance:
The Contractor shall buy and preserve such coverage as will guard the contractor and the College in opposition to any and all claims and needs bobbing up from the execution of the project. Further, whilst said within side the Detailed Specifications and Special Conditions, the Contractor will be required you bought and preserve the kinds and boundaries of coverage as specified.
Q17) Explain alternate specification and alternate bid in detail.
A17) Alternative Specification
An open specification that allows alternate merchandise is much like a closed specification in that it describes a completely unique product and might call best single product.
Open specification provisions that inspire the bidder to post change or replacement merchandise. If change merchandise is requested, a listing of the accepted change merchandise is blanketed within side the specification. The bidder ought to post pricing for the named product and is allowed to post change merchandise from the listing blanketed within side the specification, in conjunction with pricing facts for the change merchandise.
Open proprietary specs that permit substitutions call handiest an unmarried product, however encompass provisions in the product specification that permit the bidder to post replacement merchandise. The bidder chooses to post pricing for both the named or base bid merchandise and any merchandise that the bidder feels could meet the necessities of the named product. A product this is submitted alternatively product ought to have the equal capability and the bidder ought to encompass pricing facts.
Alternative Bids
Alternative bid is a suggestion made via way of means of a Bidder further or as a substitute to its original bid which can be protected as a part of its original bid or submitted one after the other therewith for functions of bidding.
Bid alternates may be utilized by a proprietor to charge out numerous alternatives it has in thoughts for an assignment. Examples include specific or extra materials, gadget or systems, creation methods, or finishing touch dates. A bid alternate can also be definitely a described growth of the assignment scope.
Contractors ought to take care to comply with the commands to bidders, and are seeking for rationalization if essential to make sure its bid is aware of the proprietor’s requests.
On the opposite hand, proprietors ought to take care to make sure that facts supplied to bidders to charge alternates is as special because the facts supplied for the bottom scope of work.
On public projects, presenting the identical possibility to all bidders is the overall degree to evaluate the legitimacy of the bid and award. Indeed, and misuse of alternates is a not unusual place cause for bid disputes.
Q18) Explain bid process management in detail.
A18) Bid Process Management
In order to try this successfully, having a person in price of bid control is key - whether or not this is simply one character inside a commercial enterprise or a person who manages a big crew of bid writers.
For SMEs and micro businesses, the position of a bid supervisor is not likely to be a person’s primary name and is much more likely to be something they mission manipulate as and while capacity possibilities arise. This may be every person from administrators via to PAs, directors or managers.
Bid management skill:
1) Organization:
This is really key in bid control. Bid managers might be in price of establishing applicable members and making sure the whole lot is entire on time. With a couple of bids at someone time, bid managers will want to be at the ball and recognize how every undertaking is progressing
2) Communication:
As a bid manager, your process is to speak to the customer why you're the excellent in shape for his or her desires and in the long run have an effect on their decision. You’ll be taking technical jargon and translating this into layman’s terms. You can even want to speak constantly together along with your group to make certain the whole lot is walking smoothly.
3) Good human’s talents:
As you’re in all likelihood to be coping with a number of humans, extremely good interpersonal talents are important. You’ll want to chase up members without being fearful of rejection, even supposing those are senior individuals of control who have already got a big workload. As a manager, your process is to steer a group, so it’s important that you could all paintings closer to the identical goal.
