What Is Tender Analysis?
Tender analysis levels the offers onto one basis and then compares them technically and commercially before award — it is not simply picking the cheapest.
Levelling before comparing
Offers never arrive identical: one has excluded an item, another assumed a cheaper specification, a third demanded a larger advance. The first step is levelling: aligning the scope, the assumptions and the payment terms until the figures are genuinely comparable. Comparing before levelling leads to choosing the worst offer at the lowest price.
Reading the comparison sheet
Compare the offers item by item, not on the total alone. Outlying rates in either direction reveal a great deal: a very low rate on an item whose quantity may grow can be unbalanced bidding — winning the job and then profiting on remeasurement — while a high rate on a simple item may mean the specification was misread.
Technical evaluation
In a structured tender the offer is evaluated technically before the commercial envelope is opened: comparable experience, the proposed team, the programme and its logic, the safety and quality plans, and the proposed subcontractors. An offer 4% cheaper with an inadequate team and an unrealistic programme costs many times the difference in delay and rework.
The award decision and its record
Record the reasons for award in a clear minute that states the levelling applied and the basis of preference. That record is a governance requirement in government bodies and large companies, and it is also your protection when the decision is questioned two years later.
Worked example
Five offers for an office building ranged from SAR 8.9 to 11.2 million. After levelling it emerged that the cheapest had excluded the HVAC works from its scope; adding them took it to SAR 10.4 million and third place, and the project was awarded at SAR 10.1 million to an offer with a stronger team and programme.
FAQ
What is an unbalanced bid and why is it a concern?
It is an offer whose rates are distributed abnormally between items while the total stays competitive — for instance inflating early items to improve cash flow, or cutting items whose quantities may grow. The remedy is to examine the item rates, not the total.
How many offers should I invite?
Three to five serious offers beat ten superficial ones, because every extra offer consumes analysis time. What matters is that those invited are genuinely qualified for the size and type of work.
Should I disclose the budget estimate to bidders?
The default is not to, so that prices are not drawn towards it — but preparing an internal estimate before going out to tender is essential if you are to know whether the offers are reasonable at all.
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