The terms ‘Bid’ and ‘Tender’ are often used interchangeably during a procurement or bidding process. A bid and a tender represent two distinct aspects of a procurement process. It is important for the issuing organisation as well as the bidders to understand the nuances related to both these terms – Bid Document vs Tender Document. Read on to know more about the difference between bid & tender document.

The Buzzwords – Tenders and Bids 

A tender refers to an invitation by an organisation for vendors to participate and bid for a project. A bid is a response to this invitation by a vendor/bidder. After the closing time for a bid, the organisation selects the best possible bid based on a set criteria. This process involves two sets of documents – i.e. bid documents and tender documents.  Let’s read more regarding bid document vs tender document.

Tender Document – An Invitation

A tender is an invitation or a formal announcement by an authority (government or private) seeking goods, raw materials, services or works for a project. Tender documents encapsulate the project requirements, specifications like work schedule, technical specifications, the procurement criteria, the evaluation criteria and the instructions for submission of bids. It is like a blueprint that guides potential suppliers and contractors to put forth their proposals. The Government tenders in India follow a well-defined procurement procedure for awarding contracts to deserving bidders. These bidding companies look for tenders online or in the newspapers and participate in bids as per the instructions given in a tender document.

Types of Tender Invitations

To know more about the difference between bid & tender document, one needs to know about the types of tender invitations –

  1. RFT (Request for Tender) – An RFT is a formal document issued by an organisation to invite interested companies to submit bids for a well-defined project which includes set technical specifications, timelines, and evaluation criteria. They are used for standard projects, construction work, purchasing existing products or when specific solutions are desired.
  2. RFP (Request for Proposal) – The purpose of an RFP is to find potential vendors for a new or undefined project, and seek options and approaches for it. It only includes the general goals and objectives without detailed specifications. They are often used for complex projects, software development and consulting services.
  3. RFI (Request for Information) – An RFI is sent to fetch basic information from a supplier and is sent before an RFQ. The RFI seeks details like size of a potential supplier’s operation, number of employees, production lines and units, the type of products they can manufacture, whether they can deliver to a location and so on. An RFI is sent to multiple suppliers so that one can compare how each one operates and to compare their market experience.
  4. RFQ (Request for Quote) – The purpose of an RFQ is to obtain specific pricing information from vendors for a well-defined project. The organisation knows exactly what they need and needs quotes to compare pricings and terms from different bidders. 

To distinguish bid document vs tender document, you can see the difference in these invitations lies in the way these contracts are released. One needs to understand them before bidding for a project. Having a partner like BidAssist.com helps you to start looking for relevant tenders in this vast ocean of opportunities. Our dedicated managers make sure to find the best and the most relevant tenders for your business. Feel free to reach out on BidAssist support for more assistance.

Bid Documents – A Response

Bid Documents are prepared to respond to a tender by interested vendors to bid for a project. Bid documents should be collated in a way that the issuing authority is convinced that this bidder will be their ideal choice for the project. The bid documents generally include qualifications of the vendor, the proposed solution to execute the project, their technical approach, pricing, availability of products and so on. The bid documents are submitted in sealed envelopes to maintain fair competition and transparency in the bidding process. They need to be submitted in time before the set deadline. Once closed, the tenderer evaluates each tender proposal and the bidder with the best deal/proposal is awarded the contract.

Bid document vs Tender document – What is the confusion about?

As per the model tender document on the CPPP portal, an RFP (Request for Proposal) that is published by an issuing organisation is also called a Bid Document. What adds to this obscurity is that even international organisations like the World Bank and ILO refer to the tender documents issued by them as Bidding documents. In order to avoid this confusion, and standardise the nomenclature, the Indian government has started using the term RFP instead of Bid Documents in their tender notices.

A Model Tender Document

Government organisations are striving to improve good governance, transparency, fairness, competition, and value for money in public procurements by undertaking significant policy initiatives. A model tender document (MTD) has been developed that incorporates national and international best practices. As per the CPPP portal, a list of contents that a model tender document should include are:

  • Notice Inviting Tender
  • Instructions for online bid submission
  • Annexure-I (General Terms and Conditions)
  • Annexure-II (Specification)
  • Annexure-III (Technical Bid and Undertaking)
  • Declaration 
  • Annexure-IV (Financial Bid)

So the information included in a Tender Document includes general and special conditions of contract, schedule for requirements, services and activities schedule, work plan, performance standards and quality assurance, method statement, qualification criteria, critical material schedule, key personnel schedule, critical equipment schedule and so on.

Bidding Documents

The list of bidding documents to be submitted along with a bid depends on what is being asked in the tender documents, which essentially comes down to the same list of documents. It’s agreed that an answer is framed based on a question, but the answer cannot be the same as the question! Hence, using these terms interchangeably is not correct. However, it is still being done, so one has to be watchful while reading a proposal. For example – The Inland Waterways Authority of India had released an invite for an online bid for Supply and Installation of AIS equipment (22 Nos.) on NW-1 under JMVP-II (Arth Ganga) and it stated that “Bidding documents are available online on https://eprocure.gov.in/eprocure/app (website) for a non-refundable fee as indicated below, in the form of RTGS/ NEFT/ Demand Draft/ Cashier’s cheque/Certified cheque from any Scheduled/Nationalised bank payable at Noida/New Delhi in favour of IWAI Fund Jal Marg Vikas”. So, let’s start seeing the difference between bid & tender document and use the terms correctly for more clarity in future projects.

Conclusion

A tender is an invitation for procuring goods and works. Bidding is the next step wherein, interested bidders pitch their proposals to match the ask. Comparing Bid document vs tender document therefore you will find that they are interrelated but are completely different from each other. BidAssist can help you make sense of these documents and prepare them for a successful bidding.