Assignment Grouping BGN 233 PDF

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FACULTY OF ARCHITECTURE, PLANNING AND SURVEYING AP DIPLOMA IN BUILDING BGN BUILDER’S QUANTITIES AND ESTIMATING IAP116 3 GNAME MATRIC NOMUHAMMAD FAKHRI ZARFAN BIN AZMAN 2019296066WAN MUHAMMAD SYAHMI THAQIF BINWAN MUHAMMAD SUBRI2019260228MUHAMMAD NABIHAN ZAHIN BIN MATNASIR2019261148NAZMI HAIZAN BIN NA...

Description

FACULTY OF ARCHITECTURE, PLANNING AND SURVEYING AP116 DIPLOMA IN BUILDING BGN233 BUILDER’S QUANTITIES AND ESTIMATING I AP1163G

NAME

MATRIC NO

MUHAMMAD FAKHRI ZARFAN BIN AZMAN

2019296066

WAN MUHAMMAD SYAHMI THAQIF BIN WAN MUHAMMAD SUBRI

2019260228

MUHAMMAD NABIHAN ZAHIN BIN MAT NASIR

2019261148

NAZMI HAIZAN BIN NAZRI

2019212938

MUHAMMAD RIDZUAN BIN MUHAMMAD ALI

2019446738

SUBMISSION DATE : 07.12.2020 LECTURER’S NAME : MADAM AZIRA BINTI IBRAHIM

NO

TOPIC

PAGE

1.

Introduction

1

2.

Introduction OF Tender

2

3.

Types of Tender :

3-7

I.

Open Tendering

II.

Selective Tendering

III.

Serial Tendering

IV.

Negotiated Contract

V.

Package Tendering

4.

Content of Tender Document

8

5.

Tender Process

9-12

6.

Introduction of Contract

13

7.

Traditional Method

14

8.

Types of Contract :

15-17

i.

Unit Price Contract

ii.

Cost Plus Contract

iii.

Design Build Contract

9.

Conclusion

18

10.

References

19

1.0 INTRODUCTION Estimating consisted of calculating the number of different items to be used and the cost of the work to be paid. A decent estimate is an actual cost. Compliance with the actual cost of the estimated cost depends on the accuracy of the calculation and the precise visualization of what is to be accomplished. Clearly, correct estimation is critical. Under-estimating can cause consumers to be unexpectedly dissatisfied when the project is completed.Other than that,the depletion of the estimator's customer could be caused by over-estimating. . Estimation is the most significant thing among the practical dimensions of construction management. One that would lead to a professional career. You need to pay particular attention in order to grasp the estimation method. It is easy to understand, but without close consideration of its execution, one is unable to use the technique effectively for practical job processes and approaches.

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2.0 INTRODUCTION OF TENDER

Tendering is a process by which proposals from prospective contractors are approved to perform particular work packages for construction. It is important to adopt and observe the core values of fairness, openness, consistency and accountability, as well as to reiterate the principle that the distribution of the challenge to the best-placed community to meet and manage is essential to the success of a project. The words 'tendering' and 'estimating' are often used in the building to mean the same thing. A rough estimate of the net cost of carrying out the sum of the specified construction projects is the measurement. Tender is a final price or offer made to the buyer by the contractor that is the sum of money in something he has negotiated to do the job that can include not only estimated costs, but also overhead and profitability. There is also an emerging amount to consolidate vendors through set performance, including for instance,' organized supply teams' on infrastructure works; the main contractor, builders, contract workers, vendors, managers of services, and many more.

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3.0 TYPES OF TENDERS 3.1 OPEN TENDERING

Open tendering allows anyone to send a tender to provide the goods or services that are required. Overall, an advertisement will be put to suggest that the contract can be tendered and to provide any institution with a similar right to tender. There will then be a post-procedure for construction work that creates a brief invitation to arrange tenders from interested suppliers. This sort of pre-qualification stage is not equivalent to selective tendering. Open tendering has been blamed for receiving tenders/requests for information from enormous quantities of suppliers, some of which may be totally unsuitable for the contract and can therefore cost a lot of time, effort and money. Open tendering, however, offers the greatest competition and has the effect of attracting new or current suppliers to try and secure jobs. This typically comes in the form of a national or regional media advertisement announcing that a tender is required for the performance of a building contract. The system has drawbacks but allows contractors new to a location or those starting new businesses the right to tender or introduce themselves.

3.2 SELECTIVE TENDER

Selective tendering only allows vendors to submit tenders upon request. A preselected selection of prospective suppliers who are proven to be appropriate for a contract of the length, complexity and sophistication demanded by their reputation is ready. Consultants or experienced customers can hold 'listed' lists of potential suppliers and then periodically review the production to decide whether suppliers should remain on the database. Selective tendering can be perfectly useful for specialized or complex contracts or contracts where there are only a few suitable companies. More selective tendering would seem to be faster than unrestricted tendering. Some see it as less costly since there is no pre-qualification procedure as part of the bidding system itself, and only suppliers deemed to be qualified for the particular contract are allowed to request tenders. 3

After all, it is possible to exclude smaller suppliers or those attempting to establish themselves in a growing product, to minimize the likelihood of technological growth, and to incorporate prejudices in the tendering process, as companies may be removed from the accepted list due to lack of knowledge or individual preferences for unspecified reasons. It may also lead to prospective suppliers contacting consumers and continuing to check that they are on the appropriate list. Contractors are supposed to be listed on an official registry, often by an architectural company, local government or regulatory agency, held by a jobs body. Such organizations have considerable experience and an accepted list of the performance of contractors is regularly reviewed.

3.3 SERIAL TENDERING Serial tendering generally involve the preparation of tenders based on a typical or national bill of quantities or schedule of works. The rates submitted can then be used to value works over a series of similar projects, often for a fixed period of time following which the tender procedure may be repeated. Serial tendering may use where the client has a regular programmer of works that they would like to be undertaken by a single contractor, often minor works, repetitive works or maintenance work. The tender document will generally define the buildings that will be covered by the works, the term over which works may be required, an estimate of the likely total value of the works that will be required over term and estimate of the likely size of individual orders. The approximate extent of the ‘series’ of planned works will be known at the initial tender stage even though the design work on some of them may as yet be incomplete. Serial tendering is an effect, a standing offer to carry out a series of projects all based on the priced bills of quantities for the first project, which becomes the ‘master’ priced document. Serial tendering allows for a number of similar projects to be placed, with one contractor providing the incentive of a continuous flow of work for the contractor. Next, serial tendering have advantage. Firstly, get better quality in minimal cost. In case, search a better contractor like professional contractor will get less the budget from target price. Serial tendering also fewer set of document required. Usually, tendering must more document did because isolate the different information in

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document. Third, contractor performance known. Serial tendering give information to contractor for know what to do and follow the document. Next, the advantage is performance bond no required at all. Bond is important in building but this serial tendering can make less required at bond. Advantage will make less time to assessing tender. Serial tendering do simple tender and not to long time to assess. Serial tendering have a disadvantage in tender. First disadvantage is miss opportunities when for new comers. It is because to understand for new comers. Next, is less formality. Usually must make administration inquiries. Last, disadvantage for serial tendering is low in responsible. Almost contractor not to care with tender and document did.

3.4 NEGOTIATED CONTRACT

A negotiated contract is one where a specific firm is targeted for a variety of reason to perform the contract, even though there is more than one firm that can be perform the contract. Under usual circumstances a competitive tender or proposal would be issued. This different from a sole source situation which accurs when only one firm is available and capable of performing the contract or the urgency of the situation dictates than the competitive process cannot be used. Negotiating with a single supplier may be appropriate for highly specialist contracts or for extending the scope of an existing contract. It can give the client the confident or working with a supplier they already know can reduce the duration and costs of tendering and can allow early supplier involvement. However, unless the structure of the negotiation is clearly set out there is the potential for an adversarial atmosphere to develop, even before the contract has been awarded. Carrying out negotiations in the absence of competition so that both parties feel the outcome is fair can be complex and time consuming. Negotiation has advantage as a solicitation method. Negotiation is a more flexible method than the order two solicitation methods. It is because negotiations allow the government and the contractor to discuss the contractor’s proposal and contractors can revise their proposals during these discussions. While sealed bidding is limited to only two contract types. So any contract may be used with negotiation. Finally, negotiation can help the government and the contractor arrive at a fair and responsible price through an analysis of price and costs that drive the price. 5

Disadvantage of negotiation contract is there are fewer options for the client to choose between and so they may be less innovation. Besides, the cost may be driven up by the lack of competitive bidding. Third, there is heavy reliance on trust between the parties also unless it is carefully structured and controlled. The negotiation process can create an adversarial atmosphere, even before the contract has been awarded. Lastly, it can be seen as anti-competitive and exclusive with the potential for ‘cozy’ relationship to develop between the client and the supplier.

3.5 PACKAGE DEAL TENDERING AND TURNKEY CONTRACTS

A package and turnkey contract is one under which the contractor is responsible for both the design and construction of a facility. The basic concept is that in a Turnkey contract the contractor shall provide the works ready for use at agreed price and by a fixed date. The reality is that the employer wants to be and should be actively involved in the project at all stages. The terms is used more or less synonymously with expressions as ‘package contract’, ‘design and build’ or ‘design constructor’ This types of contract is often associated with commercial and industrial structures where simple repetitive design and speed of construction are the main criteria and with client who to retain the services of a contractor who given good service and value in the past and with whom a positive relationship exists. The advantage for this types is can reduced total time during the contractual process by having just one process instead of two separate ones. The does not necessarily imply less construction time. Next, get a ‘lower cost’ when integrating all the element under one provider. Besides, minimizing order of changes during the implementation of the project because the changes and adjustments fall under responsibility of the only contractor. This is proposal solution for smaller projects such as communications rooms, these usually have a limited budget for the project. Definitely, the main advantage of this types is the peace of mind the owner gets when it hand over full responsibility of the project. Disadvantage this types is a higher cost assumed due to the higher risk that comes with total responsibility, there is less information to prepare proposals and therefore bidders assume more risks. The typical way to counter the increased risk is by increasing the price. Besides, there is a greater disparity when comparing offer, both economically because each provider has different criteria for assessing the risk, as 6

technically cause of the different assumptions and varied criteria a when presenting solutions. Next, usually designs are oversized due to lack of information available at the time when the offer is being prepared, several tolerance factors are taken into consideration when referring to the capacity of the equipment and are factored into the assumed risks, causing higher dimensions and because of this higher prices in the equipment are presented in the offer.

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4.0 CONTENT OF TENDER DOCUMENT 4.1. CONDITION OF TENDER First, clients need to define the terms under which a tender will be accepted for assessment. The company must for instance, meet the criteria and any additional requirements needed for the tender. Secondly, clients must provide the closing date, time and place for tenders to be submitted. This is for suppliers to obtain information on tender submissions as well as date of pre-tender briefing sessions, client contact details are required. Furthermore, clients must provide the pricing details and requirements e.g. whether prices should include or exclude taxes such as GST. Finally, tender advertisements must follow policies and principles of the government.

4.2. SPECIFICATION In this section, all the specific information about the project that the client might be interested in must be outlined by the potential contractor. These specifications may include the required goods and services, the expected time frame for the project to be completed, as well as any associated pricing, delivery and performance requirements or needs. In the final assessment made by the client, this information could play a vital role.

4.3. CONDITION OF CONTRACT All relevant and necessary information on the rights and responsibilities of the client as well as the potential contractor shall be provided in this section of the tender document. Under this section of the tender document, all the terms and conditions of the work to be done must also be clearly outlined. This section is a must because in the transaction process, it ensures clarity, understanding and transparency.

4.4. TENDERERS RESPONSE SCHEDULE This section is completed by tenders to provide information to the client. Suppliers' details to show their compliance with functional, technological, quality and contractual specifications, including where applicable, a list of costs.

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5.0 TENDER PROCESS

Figure 5.0 showing stages of tender process.

5.1. TENDER ADVERTISEMENT A statement created by the client inviting the contractor to participate and execute the project in the tender. It is usually advertised by the client in print (local press) or electronic media. The details in a tender advertisement for a contractor is important to read and understand. The basic details, such as who our client will be, what sort of project, where the document can be bought, etc. There are three types of tender advertising: open tender, limited tender and pre-qualification tender

5.2 OPEN TENDER The main tendering procedures employed by both the government and private sectors are open tendering. Open tendering enables anyone to submit a tender to supply the required products or services. This type of tender is most common for the engineering and construction sector and provides an equal opportunity for any organisation to submit a tender. Open tendering creates the greatest competition between suppliers and has the benefit of generating opportunities to try and win work for new or existing suppliers. Not all those who bid may, however be appropriate for the contract and more time is needed to evaluate the tenders.

5.3. LIMITED TENDER Selective tendering allows the submission of tenders only by invited suppliers. These suppliers are those that are considered to be appropriate for a contract of the scale, scope and sophistication demanded by their track record. Selective tendering gives clients greater confidence that their requirements will be met. For specialised or complicated contracts, or contracts where there are only a few suitable companies.

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Smaller suppliers or those seeking to develop themselves in a new market may however, be excluded. 5.4. PRE-QUALIFICATION TENDER Prequalification is a way of recognising contractors that show that they are qualified and will be interested in a future project tender. It is not always used and it is not always necessary to use it. Without the need for prequalification, most contracts are publicly advertised for tendering. For broad, complex projects requiring specialised technical skills, prequalification is commonly used. Early Contractor Participation (ECI) also enables prequalification to provide an effective means of designing and preparing infrastructure projects in a cost-effective, more reliable and less adversarial structure in which skilled contractors can provide their expertise prior to project startup.

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Figure 5.1 showing sample of tender advertisement from IIUM

5.5. TENDER SUBMISSION The completed tender document will be submitted by the contractor depending on the client’s specific time and place for submission of tender. It will then be evaluated by the client in order to choose the best and most suitable contractor for their construction project.

5.6. TENDER SELECTION The tender committee meets at least 2 officers, one of whom is a technical team or from the management level, to open the tender box witness. The tender opening committee will list bids from the highest to the lowest from contractors submitted tenders. The bid list and tender paper shall be forwarded to the tender appraisal committee for the purpose of assessing and reviewing each tender issued. Upon conclusion of the selection process, the committee prepares a report and proposes to consider the qualified contractor. The selection stage will be carried out in 2 steps, which are the evaluation of the first stage and the evaluation of the second stage.

5.7. FIRST STAGE EVALUATION First stage of evaluation consists of completion of tender form, satisfactory of financial status, and satisfactory of current work performance.

5.7.1. COMPLETION OF TENDER FORM Firstly, tender form must be completed and free from errors. It should also be perfect, reasonable and complies with the standard practice of tendering process.

5.7.2. SATISFACTORY OF FINANCIAL STATUS Secondly, in order to execute the project, the contractor should provide evidence of satisfactory financial standing. For example, the contractor has to send the bank account of their 3 months company bank statement to show to the client their present financial position

5.7.3. SATISFACTORY OF CURRENT WORK PERFORMANCE 11

Contractors who sub...