What Is Open Tendering?- Definition

Open tendering is the preferred competitive public procurement method used for acquiring goods, services, and infrastructure works. It is executed in accordance with established procedures set out in the procurement guidelines and detailed in the standard bidding documents. Open tendering is also known as open competitive bidding, open competition, or open solicitation, and the procurement notices used to call for bids for these requirements are identified as Invitation for Bids or Invitation to Tender.

Understanding Open Tendering

Open tendering is the process aimed at acquiring goods or/and services at the lowest price. The belief is to stimulate competition and minimize discrimination. This is a transparent procurement process which allows fair play for competing contractors, suppliers, or vendors. There are 2 types of biddings- open bidding (seals are open in full view) and closed bidding (seals are open in view of selective audience). It is also known as open competitive bidding, open competition or open solicitation.

The fundamental requirements of open tendering are that they should:

  • Be open to all qualified and interested bidders
  • Be advertised locally (and internationally, when required)
  • Have objective qualifications criteria
  • Have neutral and clear technical specifications
  • Have clear and objective evaluation criteria

It is presumed that this procurement method fosters effective competition and adds value for money; however, there are arguments to the contrary given that the open tendering method is strictly procedures-based and was primarily designed for the procurement of simple goods. As a result, it is not suitable for complex procurements where the focus is more on the output and outcome of the contracting process rather than on strict adherence to standards.

Benefits Of Open Tendering

Open tendering is a great procedure that can help in procuring better quality services at a cost-effective price and quickly. Some of those benefits of open tendering are mentioned below.

  • This procedure leads to no practice of discrimination and favoritism as anybody can apply for the tender through the internet
  • Open tendering takes place online and because of that fact, there is a lot of competition on the internet. Hence, the clients can rest assured that they would only get the best services at a reasonable price
  • One of the biggest benefits of open tendering is that it allows new firms and organizations to also enter into the market and make a name for themselves
  • Open tendering provides individuals and organizations with better employment opportunities
  • Through open tendering organizations can gain new experiences that are vital for their growth
  • It provides contractors with the necessary techniques and experiences to grow and flourish
  • a href=”https://aavenir.com/what-is-contract-lifecycle-management/”>Contractors and other organizations in the market can also form new customers and build longer contracts with them

Disadvantages Of Open Tendering

Some disadvantages of the open tendering process are:

  • Lengthy timeframe for completion of the procurement action
  • Requires strict adherence to procedures
  • Assumes existing internal capacity for the completion of clear and precise specifications
  • Restricts suppliers’ participation in determining the technical specifications
  • Limits the possibility of building long-term relationship with suppliers
  • Excessive formalism may limit supplier participation in the tendering process

Explore Additional Resources to Know More

Aavenir RFPflow – Request for Proposal Management for ServiceNow DataSheet| Aavenir

Learn how Aavenir RFPflow solution empowers enterprises with everything they need to accelerate procurements without introducing bad trade-offs, such as lower supplier quality, higher costs or contract proliferation.

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RFP for Design, Development of Supply Chain Management Software

The objective of this Request for Proposal Template is to request a proposal from the Supply Chain Management Software providers. The RFP outlines 45+ questions categorized as per functional and technical requirements to evaluate and identify the best-fit Supply Chain Management Software vendor.

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