TENDER EVALUATION lesson 7

EVALUATION OF TENDERS The purpose of tender evaluation is to identify the lowest evaluated bidder i.e. which when awarded the contract, shall ensure best value for money is obtained delivery/completion shall be on schedule the right quality and quantity is supplied.

STEPS IN TENDER EVALUATION Tender evaluation should be a systematic three-step method of appraising bids/quotations.   The three steps are as follows: (a) Check for Substantial Responsiveness This check establishes that the quotation/tender meets the basic requirements to constitute a valid offer that can form the basis of a contract, i.e. (i) Presence, adequacy and validity of bid security (where required), (ii) Completeness of Bids (i.e. partial offers not accepted), and (iii) Eligibility of bidder and goods

This check should be summarized in tabular form e.g.. BIDDER CRITERIA A B C D Bid Security Tender Form Completeness of Bids Eligibility of goods and tenderer SUBSTANTIAL RESPONSIVENESS

The Procurement Guidelines list what shall be considered non-responsive bids, e.g. Late bids Telex, telegraphic or telephone bids Unsolicited offers      Tenders revised by tenderer after tender closing       Incomplete tenders, etc.

b. Technical Evaluation All substantially responsive bids must be subjected to the technical evaluation. The technical evaluation checks the bids for compliance to the technical specification. However, the technical specification should not include frivolous features (such as, number of wheel nuts on a motor vehicle).

BIDDERS A B C D Minimum Specification Make/model Compaq Presario IBM 300 GL HP 2000 Acer 2000 Pentium III 400 MHz Y 8.0 GB Hard disk 512 KB Cache N 34 x CD Rom drive 3.5 Diskette Drive 15” Colour monitor SUBSTANTIAL RESPONSIVENESS YES NO

(c) Commercial Evaluation The Commercial Evaluation covers the commercial aspects of the offer i.e. price, delivery, payment terms, warranty, after sales support ,standardization, etc.

Price Delivery period 4 weeks 6 weeks 8 weeks Warranty 1 year 2 years BIDDERS EVALUATION CRITERIA A B C Price GBP220,000.00 (K800,000.00) ZAR550,000.00 (K780,000.00) US$470,000.00 (K950,000.00) Delivery period 4 weeks 6 weeks 8 weeks Warranty 1 year 2 years 3 years After-sales support Yes Payment terms 30% with order 50% on delivery 20% one month after delivery 50% with order 100% with order Ranking 1 2 3

If the lowest evaluated is not the lowest priced, this must be clearly explained and reasons for passing over the lowest priced quotation/bidgiven.

Recommendation The evaluation report should end with a clear recommendation as to what decision is advised e.g..

Delivery Date Make/Model QTY Supplier It is recommended that the contracts for the supply and delivery of motor vehicle be awarded as follows: Make/Model QTY Supplier Total Contract Price (inclusive of VAT) Delivery Date 1 Mitsubishi L2000 3000cc Petrol 4x4 Van 02 Marunouchi Motors Ltd K198,800,000.00 3 weeks 2 Toyota Camry 2000 Toyota Zambia Ltd K192,000,000.00 4 weeks 3 Isuzu KB 280 Diesel 4x4 Van c/w canopy 04 Action Auto Ltd. K382,724,000.00 4-6 weeks