Summary: Tenders can be free or restricted with constraints. Anyone can bid for free tenders provided they are in the respective fields of operation. Tenders are request by companies for prospective suppliers or service providers to bid for the project. Government is the primary source of free tenders. However, all free tenders are not identical. Various types of such tenders are there. Types are determined on the basis of establishment of categories. It is customary for the tender floating company to request for proposals from bidders. On their part bidders can respond to open or limited tenders as the case may be through single bid or multiple-bid envelops depending on the requisition of the requesting company.
Tenders can be free or tagged with constraints. Free Tenders are the ones for which anyone can apply irrespective of status and geographical locations provided that they are in the respective field of business. All free tenders are not uniform or identical and they come in various types.
Tenders are usually floated by requesting companies for purchases that are made in respect of different items. Set ups usually vary from case to case. When such purchases are made by advertising the intention of the buyer publicly, they are called tenders. Both public and private enterprises use the method for major purchases in their respective organizations.
Government Tenders
It is the Government that usually floats maximum number of Free Tenders. Those floated may be classified into various categories.
Classification by Establishment
On the basis of establishments, tenders can be classified into -
Tenders floated by the central or federal government.
Tenders initiated by the state of provincial governments.
Tenders that have been brought up by the public sector undertakings or local self government units.
Tenders that have been published by enterprises where government holds 50% or more shares.
Request For Proposal or RPF
It does not mean that just responding to the tender will win it for the bidder. Usually the requesting company asks for proposals for initial short listing. At times all the bidders are allowed to compete openly and it is the adopted procedure in case of free tenders. When published, tenders contain RPF or request for proposal where the requesting company asks the bidders to submit their proposals meeting the required specifications and by quoting their prices.
Tenders can also be open, limited, or single or multi-bid envelops tenders. Open system do not have any constraint and anyone can bid for it while limited bidding is confined to selected few. Bidders can bid with single bids or place multiple bids depending on the specification given by the requesting company.
In any case, free tenders offer far greater scope of comparison for the buyer and of competition for the seller.