All about Tenders

Tuesday, March 3, 2009

Tender Related News from India

Thursday, February 26, 2009

All about eProcurement

eProcurement is nothing but automation of manual Procurement system. A typical eProcurement suite comprises of the following modules

# Reverse Auction (RA) Application
Traditionally Purchase Managers have been negotiating with the Suppliers on one to one basis to get the best competitive price which is a gross waste of Time, Efforts & Money and both Buyers & Supplier hate to haggle.

With Reverse Auction Application you can now make all your Suppliers compete with each Online & watch the price go down while you are relaxing or doing other meaningful activities. With Reverse Auction you not only Save Time, Efforts but also achieve great amount of savings & complete transparency. In nutshell you, your Management & Supplier will just Love it.

- To learn as how Reverse Auction can help you save 5 - 20% Annually, please mail us your request to sales@abcProcure.com or call - 91-98250 27089

# Forward Auction (FA) Application
In past if you have tried to sold Scrap/Unused Machinery's you would have realized how difficult it is to get the best offer. Our Forward Auction Application automate the entire Process of Auctioning such that you derive the best possible price in the least possible time. The simplicity of this application is such that even semi literate Kabadiwalas (Scrap Dealers) can use it without any formal training.

- To learn as how Forward Auction can help you achieve 5 - 20% More for each auction, please mail us your request to sales@abcProcure.com or call - 91-98250 27089

# eTendering Application
The complexities involved in finalizing a Techno-Commercial Tender can be automated & easily managed through our eTendering Process. eTendering in nutshell saves Efforts, Time, & Money.

The beauty of eTendering Application is that on Click of a mouse You can Publish Tender Notice, Inform Bidders, Upload Documents, Conduct Online Pre Bid meeting, Submit Bid till last second with fool proof security, Pre Qualify Bidders, Generate price bid comparative & award Tender and that too without any human errors that Tendering Process is generally prone to.

Our Application complies to Information Technology Act (IT ACT) 2000, Central Vigilance Commission (CVC) Guidelines, World Bank Procurement Guidelines, etc. We are an ISO 27001 Certified Company whose product is certified by STQC, to guarantee you that No Price Bid can be viewed by any Individual (Bidders, You or Us) before Tender opening due date & time is due.

- To learn as how eTendering can help you achieve up to 50% Saving of Cost, Efforts & Time, please mail us your request to sales@abcProcure.com or call - 91-98250 27089

# Request for Quote (RFQ)Applications
Our RFQ application allows you to get online quotes for Low Ticket Items in real time. Alternatively RFQ can be used for identifying the current price of a given product or services, which can than be set as the Start price for Reverse Auction, Forward Auction, eTendering,etc.

- To learn as how RFQ can help you automate your procurement & benefit you in terms of Time & Efforts please mail us your request to sales@abcProcure.com or call - 91-98250 27089

# Team Buying
eProcurement helps you aggregate requirement within your Organization & help you discover the best possible price for the given requirement/quantity.

Team Buying takes the eProcurement concept a step further, where you can Network & club your requirement with other Buyers of similar product/services in real time. Needless to highlight Higher volumes will derive Bigger Discounts.

- To learn as how you can benefit more from Team Buying & derive additional savings over & above Reverse Auction Benefits, please mail us your request to sales@abcProcure.com or call - 91-98250 27089

# eSourcing / Rate Contract Management
eSourcing allows you to automate procurement of recurring items like raw materials, IT hardware, stationery & services. On your procurement portal Suppliers can create their Product/Service catalogue & specify special rates, discounts & volume discounts for your organisation. All your indentures can than be allowed to place orders Online directly to the Suppliers (or as per your organisation workflow). Goods are delivered directly to the Indentures & order fulfillment is done locally, while the payments is centralized.

If you have an aggressive purchase department in your Organisation, you can actually spin it off into a separate Profit Centre for your Organisation by offering eProcurement Services to other Buyers with the help our our eProcurement tools & services.

- To learn as how eSourcing & Team Buying can be clubbed & more saving can be achieved, please mail us your request to sales@abcProcure.com or call - 91-98250 27089.

Value Added Services:
# Digital Certificates Support
To make online contracts legally enforceable in India, you will have to comply with IT ACT 2000 which enforces the use of Digital Certificates & PKI standards. We can help you & your suppliers procure Digital Certificate & Crypto Tokens (Device used to store digital certificates) from Licensed Certifying Agencies.

# Market Making
True value of eProcurement can only be realised if more Suppliers are made to compete with each other online. For the same, we offer our Market Making services where we help you identify more Suppliers Globally on the basis of pre qualification criteria set by you. Under this services we also undertake the responsibility of training your Suppliers & extending them all possible support during an Online event.

Please Visit http://www.TenderTiger.com to view 1 Million Tenders.
Indian Tenders , Indian projects, Indian Supplier Contractor Database, eProcurement

Now it's even more expensive to Publish Tenders

Directorate of Advertising & Visual Publicity (DAVP) is the nodal agency which approves the rate, a newspaper can charge for publishing Tenders, which primarily depends on Circulation of the newspapers.

DAVP has offlate increased the advertising rates by 24%, which makes publishing Tenders in newspapers even more expensive. Pl. read this article Davp increases rates.

As per my estimates both Central & State Government annually publishes more than 250,000 Tenders, all of them are available on www.TenderTiger.com. Each Tenders is published in 2/3 publications, and at an average rate of Rs.500/CC, it translates into whooping Rs. 1000 Cr. A gross wastage of Public Money

In Internet age when you can reach your suppliers at click of a mouse that too at fraction of a cost, newspaper turns out to be a very expensive & an ineffective media to advertise Tenders.

Hence CVC, recommends that for publishing both Public & Limited Tenders website should be used as per various circulars listed on its website.

Please note that CVC recommends that the size of advertisement if at all published in newspapers should be minimum to save publication cost. The advt should carry Organisation name, nature of work & link to website which says more details are available on website along with Tender Document which can be downloaded for free of cost.

The perfect solution to above problem is to advertise your Tenders on TenderPortals like www.TenderTiger.com which lists each and every Tender published in India on daily basis. Tender Portals is accessed by all types of Suppliers, Contractors, Service Providers daily to search Tenders or to get daily email alerts.

Tender Portals like www.TenderTiger.com offers complete Tender Publishing Solution as per CVC orders which says you need you Publish all Document related to Tenders on website, including the following
- Detailed Tender Notice, EOI, RFP,
- Tender Document (Digitally Signed)Tamper proof
- Corrigendum & Addendum
- Minutes of Pre Bid meeting
- Tender Results

Please Visit http://www.TenderTiger.com to view 1 Million Tenders.
Indian Tenders , Indian projects, Indian Supplier Contractor Database, eProcurement

- Business Models / Project execution types

Government generally splits the work & invites tender from different agency for a Project. Failure of one agency to deliver results in delay of the entire project. And hence Tenders are invited under the following models.

# Turn Key Project
When a tender for setting up a new Power Plant is floated on Turn Key Basis, the Buyer expect Bidder to Buy Land, Build Complex, Buy & Install machinery, test run machinery, train people such that on switch of a button the plant goes live. The whole idea is to walk into a fully furnished house, where all you have to do is unlock the doors (turn key).
Please Visit http://www.TenderTiger.com to view 1 Million Tenders.
Indian Tenders , Indian projects, Indian Supplier Contractor Database, eProcurement

# SITC - Supply, Installation, Testing & Commissioning
For e.g. if a tender is floated for supply of Genset under SITC basis, than the has to Supply Machinery, Install them, Test run them & even commission them (start it) for the Buyers.
Please Visit http://www.TenderTiger.com to view 1 Million Tenders.
Indian Tenders , Indian projects, Indian Supplier Contractor Database, eProcurement

# BOOT - Build, Own, Operate & Transfer
For e.g. when a Tender for construction of Express Highway is floated on BOOT Basis, worth Rs. 100 Cr it means
- The Bidder will invest Rs.100 Cr & build the Road
- The Bidder will own it & collect toll fees from Vehicles that uses the raod
- The Bidder will operate it i.e. maintain it till the time it does not recover 100 Cr
- And eventually after he has recovered his money, he will transfer the Road to Buyer /Government.
Please Visit http://www.TenderTiger.com to view 1 Million Tenders.
Indian Tenders , Indian projects, Indian Supplier Contractor Database, eProcurement

# PPP - Public Private Partnership
Under this model, the tender is executed under partnership model (between Government & Bidder). For e.g. A new power plant is built & operated by the Bidder but the Power is distributed by Government & fees is collected by the Government. The Revenue is split between Government & Bidder on pre defined ratio.
Please Visit http://www.TenderTiger.com to view 1 Million Tenders.
Indian Tenders , Indian projects, Indian Supplier Contractor Database, eProcurement

# EPC - Engineering, Procurement & Construction
Under this model, the Bidder is responsible for Engineering Work, Procurement of Goods & machinery & even for the construction. Construction of Power Plant is a good example of EPC model. 3 different agencies are not appointed by Government for Engineering, Procurement & Construction work such that coordination is easy and is responsibility of one 1 Bidder.
Please Visit http://www.TenderTiger.com to view 1 Million Tenders.
Indian Tenders , Indian projects, Indian Supplier Contractor Database, eProcurement

Central Vigilance Commission

Central Vigilance Commission (CVC)
CVC is the nodal agency which mandates how tendering should be done such that Transparency is maintained. From time to time it issues guidelines as how the tendering process should be carried out. Some of the guidelines issued in past by CVC are listed below.

"It is needless to state that tendering process or public auction is a basic requirements for the award of contract by any Government agency as any other method, especially award of contract on nomination basis, would amount to a breach of Article 14 of the Constitution guaranteeing right to equality, which implies right to equality to all interested parties."

# Guidelines for Selection of eProcurement Service
Earlier Government use to select eProcurement service provider on ad hoc basis, and hence CVC had made it mandatory w.e.f. 1st Jan 2009 as per guidelines, that a proper tender should be floated even for selection of eTendering, eProcurement service provider. Order copy can be viewed on http://www.cvc.nic.in/E-tendersol.pdf
Please Visit http://www.TenderTiger.com to view 1 Million Tenders.
Indian Tenders , Indian projects, Indian Supplier Contractor Database, eProcurement

# Guidelines for Time Bound Processing of Tender
Many a times, tender are not awarded on time, which results in cost escalation. Taking note of this, CVC has issued orders to ensure that tenders are opened, evaluated & awarded as per the time specified in the Tender document to avoid cost escalation as per order the following order http://tender-tiger.blogspot.com/2009/02/central-vigilance-commission.html dated 6th Nov, 2008
Please Visit http://www.TenderTiger.com to view 1 Million Tenders.
Indian Tenders , Indian projects, Indian Supplier Contractor Database, eProcurement

# Guidelines for adoption of Integrity Pact within Government.
To enhance transparency in government procurement, CVC has recommended adoption of Integrity Pact in all PSU except banks in view of their limited procurement. Though it is now optional, CVC recommends that it initiatives should be taken to adopt is & once adopted it should not be discontinued as per order http://www.cvc.nic.in/007vgl0330808.pdf dated 5th August, 2008
Please Visit http://www.TenderTiger.com to view 1 Million Tenders.
Indian Tenders , Indian projects, Indian Supplier Contractor Database, eProcurement

# Acceptance of Bank Guarantee
Many a times, contractors submit fake/counterfeit Bank Guarantee and Government has no mechanism to check it. To curb this menace, CVC has asked Government to ensure that Banks send them the Original Bank Guarantee Directly through Regd. Post or at least duplicate copy to Government in cases where Original BG is not possible to post as per order dated 1st Jan, 2008 http://cvc.nic.in/010108.pdf
Please Visit http://www.TenderTiger.com to view 1 Million Tenders.
Indian Tenders , Indian projects, Indian Supplier Contractor Database, eProcurement

# Making Tendering process Mandatory for all Government Organisation
As per CVC award of contract on nomination basis, would amount to a breach of Article 14 of the Constitution guaranteeing right to equality, which implies right to equality to all interested parties and hence it has made Tendering mandatory for all Government Organizations.Only is cases of Natural Calamity, it can be avoided. Refer order no. dated 5th July, 2007 http://cvc.nic.in/OfficeOrderNo23-7-07.pdf
Please Visit http://www.TenderTiger.com to view 1 Million Tenders.
Indian Tenders , Indian projects, Indian Supplier Contractor Database, eProcurement

# Guidelines as how procurement can be improved in Government
a detailed document is issued by CVC detailing each and every step of Tendering which is available on http://cvc.nic.in/cte_man_2002.pdf
a must read document for all Purchase / Procurement Managers
Please Visit http://www.TenderTiger.com to view 1 Million Tenders.
Indian Tenders , Indian projects, Indian Supplier Contractor Database, eProcurement

# CVC disallows negotiation with L1
As post tender negotiations could often be a source of corruption, it is
directed that there should be no post-tender negotiations with L-1,
except in certain exceptional situations. To view the order copy click http://cvc.nic.in/005crd012.pdf
Please Visit http://www.TenderTiger.com to view 1 Million Tenders.
Indian Tenders , Indian projects, Indian Supplier Contractor Database, eProcurement

Colloboration in Tender

Collaboration:
In a Tender a bidder can participate either directly or indirectly.
- Bid on your own (Direct route)
- Bid in JV (Direct route)
- Bid in Consortium (Direct route)
- Act a Sub Contractor (Indirect route)
Please Visit http://www.TenderTiger.com to view 1 Million Tenders.
Indian Tenders , Indian projects, Indian Supplier Contractor Database, eProcurement

Direct Route.
# Bidders submits his own Bid.

# Joint Venture or JV - There are tenders where Joint Venture is allowed. In such tender 2 or more companies float a new company which is jointly owned & this JV Company submits bid on behalf of both the companies.

For example if there is a condition in a tender which says that the bidder has to submit Rs. 10 cr as Security Deposit, 2 small companies may not have Rs. 10 Cr individually, but they both can contribute half half & give Rs.10 Cr. In such case they will form a JV company & the JV will submit the Bid.

For Example, if there is a Tender which requires good manufactured using particular technology/machinery to be supplied, than a company which has the technology/machinery can form a JV with local manufacturer who is willing to manufacture can form a JV & submit the bid.

JV can be formed on any mutually acceptable conditions which can be technical, financial or related to execution, supervision, quality, experience, etc. Two company may not be fulfilling all the pre qualification criteria individually but under the JV banner, they can full fill all the criteria.
Eg. a Tender may have the following pre qualification cirtieria - A company having Rs.100 Cr turnover & experience of successfully executing 3 project
In such case a company having 100 Cr Turnover & a company having experience of executing 3 projects successfully can form a JV.
Please Visit http://www.TenderTiger.com to view 1 Million Tenders.

Please Visit http://www.TenderTiger.com to view 1 Million Tenders.
Indian Tenders , Indian projects, Indian Supplier Contractor Database, eProcurement

# Consortium - This is similar to JV where 2 Bidders bring in their individual strengths such that their bid gets pre-qualified. Unlike JV, a new JV company is not formed but between 2 Bidders one decides to be a Lead Partner & other secondary partner.
2 or more companies can form a consortium. When Tender is awarded it is awarded to the consortium, but it is the responsibility of the Lead partner to execute the project.
Please Visit http://www.TenderTiger.com to view 1 Million Tenders.

Please Visit http://www.TenderTiger.com to view 1 Million Tenders.
Indian Tenders , Indian projects, Indian Supplier Contractor Database, eProcurement

Indirect Route:

# Sub Contracting - Large Companies like LnT for e.g. bid in 100's of Tender annually. When they win the Tender, the break it into small parts and sub contract it.
e.g. In case of Construction of a Bridge the sub contract can be for supply of Cement, Iron & Steel, Manpower, Machinery's, etc. Small bidders who does not wish to deal with government directly can act as sub contractor to L&T for supplying cement, iron & steel, manpower, machinery's, etc.

Please Visit http://www.TenderTiger.com to view 1 Million Tenders.
Indian Tenders , Indian projects, Indian Supplier Contractor Database, eProcurement

All about Money

# Document Fees - Detailed commercial & technical specification of each tender is available in Tender Document, which most government departments sell for a small fee. Tender Document Fees is the fee towards buying the Tender Document. The reason towards making Tender Document paid are many;
- To ensure that only Serious Bidders bid
- To recover the cost of making Tender Document
- To recover the cost of Tender Advertisement
- To recover the cost of efforts involved in tendering process
Please Visit http://www.tendertiger.com to view 1 Million Tenders

# EMD or Earnest Money Deposit - To ensure that a Bidder does not submit a Dummy Bid or back out at time of tender opening, Government Department collects a small refundable fee from each bidder, which is called EMD. EMD is always in form of a Demand Draft & cheques or cash are strictly not allowed. EMD is returned when all Bids are opened & tender is awarded. In case Tender is cancelled, the EMD is returned. Most of the time the EMD is not credited into Government Bank but is kept with Buyers in as it is form. After Tender opening the same is returned.
Some Government departments however deposit the EMD into their Bank and enjoy the Interest. Some departments which are not cash rich even go to the extent of using bidders money and poor bidder actually have to bribe accountants to get their EMD back.

After Bid is opened, if a Bidders refuses to take the contract, than his EMD is forfeited. EMD is generally less than 5% of the Tender Value.
Please Visit http://www.tendertiger.com to view 1 Million Tenders

# Bank Guarantee or BG - In High Value tenders the EMD can be as high as Crores of rupees. In such Tenders Bidders will not want to make a DD of the same and give it to Government because there will be huge interest loss till the time EMD is not returned. Hence in all such Tenders instead of EMD, Bank Guarantee is also allowed.

In case of Bank Guarantee, the Bank Issues a letter to Government a sort of undertaking that if Bidder Defaults, Bank will pay amount equivalent to Bank Guarantee amount. The Government purpose is solved, because if Bidder defaults, it will get the Money from Bank. In most of the cases, BG is allowed from only Nationalised Bank i.e. BOB, SBI, etc. Some Buyers also allowed Private Banks like ICICI, Citibank, etc.

To get a Bank Guarantee, the Bidder has to do the following
Option 1: Make an Fixed Deposit (FD) of amount equivalent to Bank Guarantee amount in the Bank & Bank in lieu of FD gives the Bank Guarantee. This way Bidders get Interest on his FD & on paying a small fee (up to 1-2%) he can get a Bank Guarantee. If bank gives 9% interest on FD & he is giving bank 1% interest on BG, Bidder get a net net 8% interest. If Bidder had given an EMD, he would have lost this 8% interest.

Option 2: Bidder can pledge collateral's like House, Offices, Machinery's, Raw Materials, etc. instead of Cash and still get a Bank Guarantee. Bank on the basis of valuation of his Collateral can issue Bank Guarantee.
For e.g. if a company has a turnover of 10 Cr, than Bank can issue it a Bank Guarantee of 1 Cr, if company makes FD of just 20 Lakh, because a company which is making 10 Cr turnover can anytime pay Rs.1 Cr to bank, if it defaults.
Please Visit http://www.tendertiger.com to view 1 Million Tenders

Security Deposit - Once it is decided that a Tender is awarded to a Bidder, he has to deposit a Security Deposit with the Buyers such that if he does not complete the task as per the work order, the Buyer can recover the loss by forfeitting his Security Deposit.
e.g. If a Bidders gets Rs.10 Cr contract to construct a Bridge withing 12 months , than he has to deposit a Security deposit of 10% i.e. 1 Cr with Buyers. Now if he does not complete the bridge on time or leaves it incomplete, the Government can forfeit his 1 Cr as penalty.

Security Deposit can be in form of EMD, Bank Guarantee, National Saving certificates, Cash, etc. Only when the Winning Bidders makes the Security Deposit, he gets his EMD Back.
Please Visit http://www.tendertiger.com to view 1 Million Tenders