Don't understand all the tender process jargon?
Here’s a brief guide to get you started.
The world of bids and tenders has a huge number of acronyms and jargon that can be very confusing. To help you understand what’s what, here’s a brief guide, a jargon buster, to some of the most common terms.
Bid – a response submitted in response to an Invitation to Tender (ITT).
Bidder – a single operating organisation or person that is participating in the procurement exercise.
Buyer – this is the buying organisation or Contracting Authority that is the ‘customer’ offering the contract.
Potential Bidder – a single entity/business/operating organisation/person that has applied to participate in the procurement exercise.
Contract Notice – the notice published in the Official Journal of the European Union (OJEU) or UK Contracts Finder i.e. the advertisement of the procurement opportunity to the supplier market.
Contracting Authority – means the State, regional or local authority, body governed by public law or associations formed by one or more such authorities or one or more such bodies governed by public law that will effectively be the buying organisation offering the contract.
CCG – Clinical Commissioning Group.
Deadline – a deadline is a deadline – in the public contracts tendering process if a deadline is at midday, 12.01pm is too late!
DPS: ‘Dynamic Purchasing System’ – a DPS is similar to a framework contract except new suppliers can join at any timeover the course of the contract. It can speed up and simplify some procurement procedures particularly where there are large volumes of transactions.
EOI: ‘Expression of Interest’ – is sometimes issued by the buying organisation who intends to start a formal bidding process. It is effectively the customer asking which competitors want to be considered for the formal bidding process.
Framework – a framework is an agreement with 1 or more providers that allows public bodies to buy a range of goods or services without running a full procurement process each time. Suppliers will have qualified through a procurement process to be on a framework. There is no guarantee with a framework that any services will be bought. When one of the public bodies wishes to buy something from the framework they ‘call off’ the framework either directly, or using a mini-competition.
ITT: ‘Invitation to Tender’ – this is effectively the main step in the process where suppliers are invited to provide offers to supply services or products and win a contract with the buying organisation. This requires the supplier to respond to detailed questions about the service or product and usually submit pricesby a specified deadline.
MEAT: ‘Most Economically Advantageous Tender’ – this is fundamentally the basis upon which the buying organisation evaluates and selects the winning bidder. It ensures the award of the contract is based on all aspects of the tender rather than just on price.
OJEU: ‘Official Journal of the European Union’ – this is the central noticeboard on which all public sector ITT’s above a specified threshold must be advertised by the Contracting Authority.
PIN: ‘Prior Information Notice’ – this is a notice from the buying organisation’s procurement team that they intend to purchase in the future. There is no guarantee that they will go ahead and procure nor is there any guarantee that they will do so at the times that they specify. At this stage they sometimes ask the market to engage with them to help formulate their procurement strategy.
Portal – all tender documentation including the specification, terms, questionnaire etc. needed for responding to a tender is stored and made available to bidders on an electronic portal on the internet. A portal is usually a page on the buying organisation’s own website, or a specific site e.g. ProContract, In-Tend, which are managed by a third party on behalf of buying organisations to facilitate the procurement exercise. The portal is also where the response to the ITT is submitted.
PQQ: ‘Pre-qualification Questionnaire’ – a stage prior to the tender submission (ITT) with several standard questions. The pre-qualification stage aims to create a short-list of qualified suppliers and eliminate others that do not meet some basic requirements before the ITT stage. Typical requirements usually include financial stability, insurances, previous experience. Once this has been approved, criteria met, the supplier is selected for the shortlist and invited to tender.
Providers – the successful Bidders who have entered into a contract with the Contracting Authority to provide the service or goods.
SQ: ‘Selection Questionnaire’ – effectively the same as a PQQ. This is still about pre-qualifying so that suppliers meet baseline criteria prior to submitting a bid. The term Selection Questionnaire was supposed to supersede PQQ but both are still being used.
RFI: ‘Request for Information’ – here a procurement team are asking the supplier market to provide general information about products or services prior to any formal tender process. There is no guarantee of business at this stage. This term may also be used (loosely) by private buying organisations instead of calling it an ITT as a way of selecting preferred suppliers.
RFQ: ‘Request for Quote’ – this is the buying organisation asking the supplier to provide a quote for goods or services.This is usually focused on submitting pricing through which the procurement team can make an evaluation of the best bidder. Again,this is not binding and not a guarantee of work.
Regulations – usually in the tender context this refers to The Public Contracts Regulations 2015 (as amended from time to time).
Tender – a tender is actually a bid but the term is often applied to mean the whole tendering process.
TUPE: ‘Transfer of Undertakings (Protection of Employment) Regulations’ – this is relevant to any redundancy decisions where a business or part of it is transferred from one owner to another.
Value for Money or VfM – the optimum combination of whole-life cost and quality (fitness for purpose) to meet the Contracting Authority’s requirements.
We hope this ‘jargon buster’ helped to make things clearer!