Tender Document in Construction: A Quick Guide

Big construction projects are a coordinated effort between many different professionals. Suppliers and contractors have to be solicited, bids submitted and partnerships created. This essential process starts with a tender document.

To understand procurement, one must first understand what a tender document is, who uses it and what should be included to ensure that everything goes smoothly. To put that in context, we’ll also show how it’s done in a real-life scenario.

 

What Is a Tender Document?

A tender document is several formal documents used in procurement to invite bids from contractors, suppliers or service providers for a specific project or service. Organizations issue tender documents when they need to source goods, services or construction work, often for large-scale projects. It provides all the necessary information bidders need to prepare and submit competitive proposals.

A tender document is important because it ensures a transparent, competitive and fair selection process. What it does is outline the project requirements, terms and conditions, which helps potential bidders understand what’s expected. This process allows organizations to evaluate bids objectively and select the most suitable contractor based on criteria like cost, quality and timeline.

The tender document also acts as a foundational reference for the creation of the project schedule. That’s because it helps outline the project scope, timeline, deliverables and key milestones that will be visualized on a Gantt chart, a critical tool used in construction project management software.

ProjectManager is award-winning project and portfolio construction management software with robust Gantt charts that schedule resources, costs, tasks and more. But our tool goes further, linking all four types of task dependencies to avoid cost overruns, filters for the critical path to identify essential tasks and slack, plus can set a baseline to track progress in real time. Get started with ProjectManager today for free.

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Who Requests a Tender Document?

A tender document is typically requested by an organization or entity seeking to procure goods, services or construction work through a competitive bidding process. The entity requesting the tender document is often called the client, project owner or employer. Here are some examples.

• Government Agencies and Public Sector Organizations: Government bodies often request tender documents for large-scale infrastructure projects, public works or service contracts. Public sector tenders follow strict procurement regulations to ensure transparency and fairness.
• Private Companies and Corporations: Private businesses may issue tenders when they need external vendors or contractors for specialized projects such as construction, IT system development or facility management.
• Construction Firms and Developers: Real estate developers or construction companies may request tenders for subcontractors, materials suppliers or consultants for large building projects.
• Nonprofit Organizations and NGOs: Nonprofits may request tender documents when seeking suppliers or service providers for humanitarian aid, community development programs or research initiatives.
• Utilities and Infrastructure Companies: Energy companies, telecommunications providers or transportation authorities often issue tenders for large projects like power plants, communication networks or roads.

Any organization needing external expertise, services or materials to complete a project may request a tender document to find the most suitable vendor through a transparent and competitive bidding process.

Who Submits a Tender Document?

A tender document is submitted by companies, contractors or service providers interested in winning a contract for a project or providing goods and services. These entities respond to the invitation to tender (ITT) the client or project owner issued. The following is a list of those entities.

• Construction Contractors and Subcontractors: In construction projects, general contractors or specialized subcontractors submit tender documents to bid for contracts related to building, civil engineering or infrastructure projects.
• Suppliers and Vendors: Companies that provide raw materials, equipment or other resources often submit tenders to fulfill supply contracts.
• Consulting Firms: Management consultants, engineering consultants and IT service providers submit tender proposals for projects requiring their expertise.
• Service Providers: Organizations offering services like maintenance, logistics, transportation or facility management submit tender documents in response to service-based contracts.
• Design and Architecture Firms: For design-build projects or urban development, architects and design firms often participate in the tendering process to provide their creative solutions.
• Joint Ventures: For large-scale projects, multiple companies may form a joint venture and submit a collaborative tender document to pool resources and expertise.
• Freelancers or Small Businesses: In some cases, independent contractors or small business owners may submit tenders for smaller projects or specialized tasks.

All qualified entities that meet the requirements outlined in the tender invitation can submit a tender document, competing to secure the contract by proposing the most competitive and capable offer.

Tender Document Example

As promised, we’re taking the facts we’ve defined above about a tender document and showing how they work in a real-life scenario. In our example, we’re looking at a commercial construction project.

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As seen in the above tender document example, the project is named, the scope is defined and the instructions are outlined for bidders to follow. Submission requirements are detailed, including the method. The evaluation criteria are also defined, as well as terms and conditions. All this provides a roadmap for bidders to submit and the construction company to choose the one that best fits their needs.

What Should Be Included in a Tender Document?

A well-structured tender document provides clear and detailed information to potential bidders to ensure that they understand the project’s requirements and can submit competitive, compliant proposals. It serves as a formal guide for the bidding process, outlining expectations, evaluation criteria and contractual terms. It should include the following components.

Invitation to Tender

An invitation to tender is a formal announcement inviting qualified companies or individuals to submit bids for the project. It typically includes a brief project summary, deadlines and instructions for accessing additional information.

Project Overview & Background

This section provides context about the project, including its purpose, objectives and any relevant background information. It helps bidders understand the project’s significance and key goals.

Scope of Work

A scope of work is a detailed description of the tasks, deliverables and responsibilities required for the project. It outlines the expected outcomes and the standards bidders must meet.

Submission Requirements

Clear guidelines on what bidders need to include in their proposals, such as financial information, experience, technical capabilities and proposed timelines.

Submission Method

Instructions on how and where to submit the tender, including formats, deadlines and whether the submission should be physical, digital or through an online portal.

Eligibility Criteria

Eligibility criteria define the qualifications and experience required for bidders to participate, ensuring only capable and relevant companies submit proposals. This may include licenses, certifications or financial stability.

Evaluation Criteria

Outlines how proposals will be assessed, often using factors such as cost, technical capability, experience and proposed timelines. This ensures transparency and fairness in the selection process.

Payment Terms

Payment terms offer details on how and when payments will be made, including milestones, payment schedules and any penalties or incentives tied to performance.

Contract Terms and Conditions

The legal framework governing the project includes responsibilities, dispute resolution mechanisms, confidentiality agreements and other contractual obligations. Bidders are expected to review and agree to these terms when submitting their proposals.

Related Construction Project Management Templates

Several free templates can help with the procurement process. These are just a few of the over 100 free project management templates for Excel and Word that can be downloaded from our site. Some templates serve all aspects of managing a project across multiple industries. Here are the ones to help when using a tender document.

Request for Quote (RFQ) Template

Download this free request for quote (RFQ) template for Word to solicit price quotes from suppliers, vendors or service providers for specific goods or services. It provides a clear framework for requesting detailed pricing information, helping businesses compare offers and select the most cost-effective option.

Request for Information (RFI) Template

Use this free request for information (RFI) template for Word to gather information from potential vendors, suppliers or service providers. Unlike a Request for Quote (RFQ), an RFI is primarily used in the early stages of procurement or project planning to gain insights about available solutions, industry capabilities and vendor qualifications.

Bid Proposal Template

This free bid proposal template for Word can be used by contractors, vendors or service providers to submit formal offers in response to project opportunities. It outlines the bidder’s approach, qualifications, pricing and other relevant details, demonstrating why they are the best choice for the project.

How to Manage Construction Projects With ProjectManager

Templates can be helpful during procurement, but they’re not ideal. These are standalone documents and any information discerned in the process of creating a tender document, for example, will have to be moved into project management software. That’s because static documents are a poor choice for managing dynamic projects.

ProjectManager is award-winning project and portfolio construction project management software with multiple project views that let everyone on the construction crew work how they want. General contractors can schedule work on Gantt charts, teams can execute their tasks on kanban boards or task lists and stakeholders can stay updated on progress with the calendar view.

Track Resources and Keep Everyone Productive

The resources contracted with the tender document can be scheduled on the Gantt chart. Then, for the human resources, set their availability when onboarding. This includes everything from PTO, vacation and global holidays to skill sets and pay rates. To view resource allocation across all projects, use the workload chart. It’s color-coded to make it easy to see who is overallocated or underutilized.

The team’s workload can be balanced without leaving the chart to keep everyone working at capacity without threatening burnout. There’s a team page that shows their activity on a daily or weekly basis. It can be filtered by progress or priority and tasks can be updated from that page.

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Monitor KPIs With Real-time Construction Dashboards

To get a high-level overview of project resources and other metrics, toggle to the real-time project or portfolio dashboards. The easy-to-read graphs and charts help track everything from time to cost, workload and more.

For more information, use customizable reports on status, variance, timesheets, workload and more. Filter the reports to focus on key data points or share more general information with stakeholders and keep them up-to-date. Even our secure timesheets help by keeping managers updated on labor costs to help stay on budget.

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Related Construction Project Management Content

A tender document is only a small part of construction project management. For those interested in learning more about this industry, we have listed below links to a handful of recently published articles on the subject, from bidding to how to write a proposal.

• Construction Bidding Basics: Mastering Construction Bids
• Contract Bidding Process: A Quick Guide
• RFP: A Quick Guide to Request for Proposals
• Creating a Request for Quote (RFQ) for Procurement
• How to Write a Bid Proposal (Templates Included)

ProjectManager is online project and portfolio management software that connects teams whether they’re in the office or at the job site. Teams can share files, comment at the task level and stay updated with email and in-app notifications. Join teams at Avis, Nestle and Siemens who use our software to deliver successful projects. Get started with ProjectManager today for free

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