--- title: "Tender evaluation and selection of contractor" subject: "Construction Management" chapter: 5 key: "semester_8/construction_management:tender-evaluation-selection" source: https://www.bctengineer.com/q/semester_8/construction_management/tender-evaluation-selection site: BCT Engineering --- # Tender evaluation and selection of contractor Construction Management · Chapter 5: Contract Management - Asked in: 2069 Bhadra (old course), 8 marks; 2068 Bhadra (old course), 8 marks; 2067 Mangsir (old course), 8 marks; 2065 Baisakh (old course) (asked 4 times) - Video: [Understanding the tender evaluation process for your construction project](https://www.youtube.com/watch?v=nlx3-lHuJRA) — Evolution5 - Answer checked by Claude Opus 5.5 (high effort) on 2026-10-14 - Page: https://www.bctengineer.com/q/semester_8/construction_management/tender-evaluation-selection - Whole chapter: https://www.bctengineer.com/md/semester_8/construction_management/chapter-5 ## Question Explain the process for opening and evaluation of tender (bid) and selection of contractor in construction projects, including how tenders are scrutinised and compared. ## Short answer Bids are received sealed, opened publicly, checked for responsiveness, then evaluated technically and financially. Arithmetic errors are corrected and evaluated bid price is compared; the lowest evaluated responsive bidder is post-qualified. After a 7-day notice period, Letter of Acceptance is issued and 5% performance security submitted. ## Answer Tender evaluation follows the Public Procurement Act, 2063 and the Public Procurement Regulations, 2064 (Nepal) and the bid documents. The process is open, fair and based only on the criteria stated in the bid document. ```text Receipt -> Opening -> Preliminary exam -> Technical eval -> Financial eval -> Ranking -> Post-qual -> Award ``` #### 1. Receiving and opening - Bids are received in sealed envelopes up to the deadline; late bids are returned unopened. - Bids are opened publicly, at the time and place stated, before the bidders' representatives. The name of each bidder, bid price, discounts, bid security and alternatives are read out and recorded in the minutes, which all present sign. #### 2. Preliminary examination (responsiveness) The evaluation committee checks the bid security (amount, validity), signed forms, completeness of documents, validity period, power of attorney, registration, tax clearance, and that the bid is in the required currency. Bids that are not substantially responsive are rejected. #### 3. Technical and qualification evaluation Experience in similar works, financial capacity (turnover, bank guarantee), key personnel, equipment, work programme and method statement, and capacity are evaluated on a pass/fail basis (or with a score in QCBS). #### 4. Financial evaluation - Arithmetic errors are corrected (unit rate prevails over the total; words prevail over figures). - Omissions, discounts and conditions are adjusted to give the **evaluated bid price**. - Unusually low bids (below about 85% of the estimate) are checked for realistic rates, and an additional performance security may be asked for. - Bids are compared on the evaluated price and ranked. #### 5. Selection and award - The lowest evaluated responsive bidder is ranked first and is post-qualified. - The committee's report is approved by the approving authority. - A notice of the intention to award is given to all bidders, who have a period (7 days) to complain. - The Letter of Acceptance is issued, the performance security (5% of the contract price) is submitted, and the contract is signed. ## Check yourself The answer's key points as multiple-choice questions, with the correct option and why. 1. In what order is a tender evaluated after public opening? A. Preliminary (responsiveness) exam, technical/qualification, financial evaluation, ranking, post-qualification, award B. Financial evaluation first, then preliminary exam, then technical C. Technical evaluation, award, then preliminary exam D. Ranking by lowest price, then technical, then opening Answer: A. The flow is receipt, opening, preliminary exam, technical, financial, ranking, post-qualification and award. (Key point: Order of evaluation) 2. What is checked in the preliminary examination? A. Only the bid price compared with the engineer's estimate B. Whether the bid is substantially responsive: bid security, signed forms, completeness, validity, registration, tax clearance C. The contractor's past equipment and key personnel only D. Whether the lowest bidder can finish in time Answer: B. This stage rejects bids that are not substantially responsive before any detailed evaluation. (Key point: Preliminary examination) 3. How are discrepancies handled in financial evaluation? A. The bid is rejected for any arithmetic error B. Figures prevail over words and the total prevails over unit rates C. Arithmetic errors are corrected (unit rate prevails over total, words over figures) to get the evaluated bid price D. The quoted price is accepted without any correction Answer: C. Corrections, adjustments for omissions and discounts give the evaluated bid price used for ranking. (Key point: Financial evaluation corrections) 4. Which sequence is correct after the committee report is approved? A. Contract signing, then notice of intent, then performance security B. Letter of Acceptance, then bid opening, then complaints C. Performance security of 2-3% before the notice of intent D. Notice of intention to award (about 7 days for complaints), Letter of Acceptance, performance security (5%), contract signing Answer: D. All bidders are informed first and may complain; then acceptance, performance security and the contract follow. (Key point: Award steps) ## Related in Construction Management - [Contractor pre-tender stage planning](https://www.bctengineer.com/question.md?key=semester_8%2Fconstruction_management%3Acontractor-pretender-planning) — Construction Management, chapter 2 - [Prepare tender notice for commercial complex](https://www.bctengineer.com/question.md?key=semester_8%2Fconstruction_management%3Aprepare-tender-notice-100mln) — Construction Management, chapter 5 - [Bid bond and performance bond](https://www.bctengineer.com/question.md?key=semester_8%2Fconstruction_management%3Abid-performance-bond) — Construction Management, chapter 5, asked 2× - [Short note: Pre-bid meeting](https://www.bctengineer.com/question.md?key=semester_8%2Fconstruction_management%3Apre-bid-meeting-note) — Construction Management, chapter 5 - [Client role in pre-tender stage planning](https://www.bctengineer.com/question.md?key=semester_8%2Fconstruction_management%3Aclient-pretender-planning) — Construction Management, chapter 2, asked 2× - [Tender notice and its contents](https://www.bctengineer.com/question.md?key=semester_8%2Fconstruction_management%3Atender-notice) — Construction Management, chapter 5, asked 2× ## Related in other subjects - [Risk in construction projects and its management](https://www.bctengineer.com/question.md?key=semester_7%2Fproject_engineering%3Arisk-define-more-chance-construction) — Project Engineering, chapter 5 - [Contractor asks supervisor to prepare running bill](https://www.bctengineer.com/question.md?key=semester_8%2Fengineering_professional_practice%3Acontractor-running-bill-bribe) — Engineering Professional Practice, chapter 7 - [Standard forms and evaluation criteria](https://www.bctengineer.com/question.md?key=semester_7%2Fict_project_management%3Astandard-forms-evaluation-criteria) — ICT Project Management, chapter 13 - [Geology in bridge site selection](https://www.bctengineer.com/question.md?key=semester_4%2Fengineering_geology_ii%3Abridge-site-selection) — Engineering Geology II, chapter 4, asked 6×