A Survey of Tendering Practices in the Australian Construction Industry

Abstract

This paper presents the findings of a survey of the tendering practices of Australian civil engineering construction contractors. Common practices in assessing risks and opportunities, assessing the competition, setting margin, and developing competitive tendering strategies are discussed. A major conclusion is that much of the process is subjective and based on experienced judgement. Assessing the competition is almost always done on an informal basis without using historical competitor data. The margin-size decision (i.e. corporate overhead and profit) is usually done in the final few hours prior to tender submission with little or no formal methods of analysis. Most of the time, effort, and decision-making are directed towards estimating the direct costs, in formulating the construction methodology and design alternatives, and in assessing the risks and opportunities.