Quoting and tendering

The quoting/tender process

Most remediation projects require contractors who have special skills and experience. Having an experienced contractor involved in the remediation design process may be advantageous. 

Limiting the number of firms pricing the work to a small group of known, reliable and experienced contractors or negotiating with a single suitable contractor is more likely to ensure a successful project outcome. It is preferable to have at least three submitted tenders rather than one, especially if costs are to be recovered from others.

Open tenders are generally unsuitable for remediation projects as the tenderers’ approaches to pricing can vary widely, making the acceptance of any particular tender risky for the owner. Labour-only contracts are not considered appropriate for remediation projects.

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What should also be provided with a quote/tender

When a quote or tender is being submitted, the builder should also be asked to:

  • give a tender period or completion date
  • provide a programme of work where one has not been specified by the designer or project manager
  • provide hourly rates that would be applied to additional work not identified in the contract documentation
  • provide rates for specific remediation tasks (for example, a contractor may be asked to give a per-metre rate for the replacement of rotten timber where the extent of the damage is difficult to ascertain, and as the contract proceeds, the contractor would be paid for the actual amount of timber replaced at the agreed rate)
  • identify the margin to be applied to additional materials required – the additional amount of material used can be readily measured or supported by purchase invoices
  • identify where sums have been included for portions of work (other than those identified in the contract documents) because the tenderer has been unable to price the work with certainty
  • provide the names of the key personnel and subtrades being used including registrations and licence numbers
  • nominate the site manager/foreperson
  • provide proof of insurance cover
  • a site management plan including site protection measures proposed and a health and safety policy.

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Contract pricing

Accurately pricing remediation work before the job has started is difficult as there are so many unknowns. Pricing will generally be more reliable where:

  • the survey of the existing buildings and the identification of problems and potential damage is comprehensive
  • the remediation details and specification are comprehensive 
  • the extent of work is clearly defined.

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Evaluation of quote/tender

Once tenders have been submitted, they need to be evaluated to ensure:

  • all tenderers have priced on the same extent of remedial work – pricing comparison becomes difficult where the extent and quality of work is not clearly defined or tender documents do not provide specfic information to be returned (filling in information on forms provides the best results) 
  • there are no obvious omissions or extra inclusions, including tags and qualifications
  • identified subcontractors are acceptable.

Where the start dates and the time to complete the work have been left to the contractor to nominate, each contract period needs to be considered alongside the price – one contractor may take longer but the price may be lower.

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Contract period

In general, the contract period should be nominated by the contractor. However, if it is left to the tenderer to nominate the contract period, this will allow a price/time comparison to be made (that is, some tenderers may take longer but charge less).

Depending on the scale of the contract, it may be broken into a number of stages, each with their own completion date.

Contract periods may need to be adjusted as the work proceeds to take account of:

  • additional unforeseen work
  • unusually bad weather
  • additional client, designer or BCA requirements instructed after work commences
  • availability of the site to allow access to begin work
  • delays where a building consent has not been obtained before tendering and getting formal approval of amendments to consents – getting the building consent approved before going to tender is recommended.

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Insurances

During all stages of remediation work, the building must be insured to cover both the owner and builder against unintended loss. Generally, it is the owner’s responsibility to maintain insurance cover on the building and the contents, but they must notify their insurance company that work is being carried out on the building and have that recorded on the policy documents. This means they need to arrange contractor’s risk insurance with the contractor named as an extension to the owner’s homeowner's policy.

Builders will also need public liability insurance to indemnify them from damage they may cause to public facilities or the public.

Also see issues during construction.

Updated: 9 September 2014