Competitive tendering was one of the main procurement methods for construction projects in the 20th century. Due to the disadvantages such as impacts of design change, quality of final products etc., continuous application of this tendering method to construction projects has become quite arguable. This research has examined and compared clients’ view and contractors’ view on competitive tendering in the Sudan construction industry. Considering their opposite positions in relation to competitive tendering, clients and contractors have been compared. 16 comprehensive questions were asked. The outcome shows that there is virtually no difference between clients’ view and contractors’ view in competitive tendering. Therefore, competitive tendering may be still efficient and effective in the 21st century as both parties are well aware of the advantages and disadvantages. Further researches are required possibly in other countries to verify the findings of this research.
Tendering is one of the important pre-construction stages that the client should pass through for any construction project to be initiated. Basically tendering is the client selection of the most suitable contractor from a group of contractors who are invited either in public or directly depending on the tendering method. The client will set a deadline for the contractors to submit their bids to be reviewed and evaluated by the team. The most commonly used tendering processes in the construction industry are competitive tendering and negotiation. The two processes have been used worldwide for the selection of contractors for construction projects. Competitive tendering is a method that allows the undoubted interests of all organizations in the construction industry. The data and documentations used in competitive tendering are beneficial to those personnel in the construction industry who have contributed in estimating of construction projects or forecasting future trends [
The objectives of this research are:
To investigate current practice of competitive tendering in the Sudan construction industry;
To compare clients’ view and contractors’ view on competitive tendering in the Sudan construction industry.
Competitive tendering involves the client awarding the contract to a certain contractor after going through the process of bid evaluation from a group of contractors who have shown their interests in winning the contract. Selection of contractors relies on the submitted documents which provide detailed descriptions of the plan on how the project will be executed and the corresponding cost of the construction services. Clients will also look through each of the contractor’s experience, financial status and their equipment [
Open tendering and selective tendering are two main competitive tendering methods. In open tendering, the tendering is advertised in local, national and international press. Project details together with the evaluation standards will be included in the advertisement and an invitation for all interested contractors to propose their bids. Selective tendering is a method of selecting tenderers and obtaining tenders by a limited number of contractors who are invited to tender. The tender list is made up of contractors who are considered suitable and able to carry out the work. This suitability is usually determined by pre-selection procedures.
These are several advantages and disadvantages of using competitive tendering for construction projects [
One of the objectives of competitive tendering is to achieve most efficient and best quality service to the client with the lowest possible price in both public and private sectors. The rules of competitive tendering does not allow for negotiation with the client after bids submission. So this will encourage the bidders to come up with their optimum bids and to be creative in their technical proposals to the client in order to succeed and win the contract.
Competitive tendering requires clients’ inspection on the level of services based on the specifications and required level of quality. This generates competition and results in improving the contractor’s performances in construction projects.
Competition is the one most effective ways in obtaining the best value for money. Competition motivates the contractors to provide the best services and to operate with their full capacities.
Competitive tendering also creates transparency which leads to the reduction of favoritism and corruption. It also
| Competitive Tendering | Negotiation |
|---|---|
| No discussion and deviation is allowed | Discussion is permissible as well as deviations |
| Less period of time is given for the contractors to study the project | Wide period of time is given for the contractors to study the project |
| Reduces risks to the client i.e. less cover priced bids | Promotes the use of cover prices |
| Expensive | Cheaper |
| Time consuming | Save time |
| Open Tendering | Selective Tendering |
|---|---|
| High risk to the client | Less risk to the client |
| Develop contractors reputation | Less chance of improving contractors reputation |
| Reduces the use of cover price by contractors | Encourages the use of cover priced bids |
ensures fair competition between tenderers.
However competitive tendering in the construction industry suffers from various disadvantages. These are:
Leading contractors are very demanded in the construction industry. They are extremely busy by committing to other projects to the extent that they might have a waiting list of clients. Competitive tendering cannot attract them.
In selection of contractors by competitive tendering, the only mean of communication between the client and the contractors is the bids. Rather there should be a specified period of time arranged by both parties to have a wide discussion about the designs and specifications in order to find out the necessary improvements.
In competitive tendering, the confirmation of designs and specifications are done by the client. If the client discovers some changes to the design after construction starts, this consequently creates additional costs.
The contractor might find the use of poor quality material is the solution to keep the project cost unchanged and ensures the existence of profit while meeting the required specifications. This will eventually end up with a low quality product.
In competitive tendering, the advertisement fees and tendering process costs are far higher than other methods of tendering such as selective tendering and negotiation.
Invitation or advertisement of the project to the contractors, promotion of the competition between them and final evaluation of their bids are all conducted by the client to find the most suitable contractor. However, the client can assign the selection of the contractor to a consultant engineer/designer or a project manager, relying on their expertise in this field. Advertisement of government projects can be done through several means such as local newspapers, online websites, journals like Engineering News and Records and other weekly or daily publications. In case of private projects (i.e. projects sponsored by a private client), typically the client restricts the process of advertising the project to a limited number of selected contractors. During the process of bids evaluation, the client should ensure that the contractors has submitted all the necessary documents, the contractor satisfies the qualification and experience requirements. Once the lowest bidder is selected then both the client and the contractor sign the contract documents.
The consultant engineers/designers are responsible for the design process and assisting the clients in formulating the tender and contract documents such as drawings, specifications, conditions of contract and other essential documents. One of the main tasks of the designers is to ensure that the structural design is compatible with the design brief, specifications, and statutory requirements.
Project managers are responsible exclusively to the client and acts in the client’s interests at every stage of the project. Project managers offer advice, uncoloured by any conflicting interest, on construction/project management.
Initially the contractors will come through the project’s requirements, drawing, specifications and bill of quantity which are prepared by the clients for them to decide whether to bid or not. At this stage of tender, the bidders should be creative and accurate since the time period is limited and very little to negotiate with materials and equipment suppliers, labor rates and subcontractors. The contractor will look into the project from different angles to make the decision of whether to bid or not, based on the factors such as project type, project size, type of client, availability of resources, degree of competition, conditions of contract, current market conditions.
The Republic of Sudan is located in northeast Africa. Sudan was considered as the third biggest African country and the ninth in the world rankings in terms of area before the segregation of South Sudan. South Sudan became an autonomous government in 2005 and an independent country in 2011. Before the agreement was signed by the North and South government of Sudan in 2005, there was a long civil war between these two governments. During this civil war period, the economy of Sudan was so poor and consequently the construction industry was not much developed. Since the agreement in 2005, Sudan has experienced stability in the economic status and the government initiated to develop the country. The government used considerable amount of its expenditure in developing infrastructure in the capital city and other major cities. The infrastructure projects include highways, drainage systems and building constructions. Companies in the private sector also became very active particularly in housing renovations. This background of the Sudan construction industry justifies the needs of this research in competitive tendering.
A questionnaire was developed based on the literature review. To comprehensively investigate the Sudan construction industry, the questionnaire attempted to obtain the respondent’s views on the advantages and disadvantages of competitive tendering as well as a comparison between both competitive tendering and negotiation. The questionnaire contained three sections with the following details:
・ Section [A]: Respondent background such as roles, responsibilities, experience, education, public sector or private sector;
・ Section [B]: To identify the strengths and weaknesses of competitive tendering, to compare competitive tendering and negotiation;
・ Section [C]: Preferred methods of tendering and comments.
51 responses from the survey were received in the Sudan construction industry. The main questions in section B consist of 16 comprehensive questions related to competitive tendering for construction projects (
The first step to be performed by SPSS analysis is to test the normality of the variables based on their significance values. The main purpose of this test was to know whether to use parametric or non-parametric tests. To apply parametric tests, homogeneity and normality of the variances should be shown. If the variable violated these conditions then the variable will be considered abnormally distributed and accordingly non parametric tests will be applied on it.
| Variables | Description |
|---|---|
| Q1 | Tends to improve efficiency and quality of construction services to the clients due to the competition between contractors |
| Q2 | Achieving the best value for money by considering the quality and suitability of the services to meet client’s requirements |
| Q3 | Reduces corruption and favoritism |
| Q4 | Generates competition between contractors and thus helps in improving their performance in the industry |
| Q5 | Promotes Collusion |
| Q60 | Some of the leading contractors may not tender |
| Q7 | Communication is restricted between the supplier (contractor) and the procurer (client) |
| Q8 | In case of design bid build, design changes after the construction starts results in high cost and delays |
| Q9 | Use of low quality materials and labors by contractors to obtain high profit |
| Q10 | Advertising and selection cost is expensive |
| Q11 | Competitive tendering promotes the submission of non-competitive bids by the contractors (bid shopping) |
| Q12 | Negotiated contracts are less risky in terms of cost overrun and time delay |
| Q13 | Changes are easily acceptable as long as the client agrees |
| Q14 | Early involvement of the contractors in the projects |
| Q15 | Can achieve cost savings |
| Q16 | Can shorten total project duration |
| Kolmogorov-Smirnova | Shapiro-Wilk | |||||
|---|---|---|---|---|---|---|
| Statistic | df | Sig. | Statistic | df | Sig. | |
| Q1 | 0.206 | 51 | 0.000 | 0.820 | 51 | 0.000 |
| Q2 | 0.196 | 51 | 0.000 | 0.858 | 51 | 0.000 |
| Q3 | 0.200 | 51 | 0.000 | 0.909 | 51 | 0.001 |
| Q4 | 0.262 | 51 | 0.000 | 0.790 | 51 | 0.000 |
| Q5 | 0.218 | 51 | 0.000 | 0.893 | 51 | 0.000 |
| Q6 | 0.180 | 51 | 0.000 | 0.924 | 51 | 0.003 |
| Q7 | 0.171 | 51 | 0.001 | 0.917 | 51 | 0.002 |
| Q8 | 0.176 | 51 | 0.000 | 0.888 | 51 | 0.000 |
| Q9 | 0.130 | 51 | 0.030 | 0.927 | 51 | 0.004 |
| Q10 | 0.161 | 51 | 0.002 | 0.942 | 51 | 0.014 |
| Q11 | 0.144 | 51 | 0.010 | 0.930 | 51 | 0.005 |
| Q12 | 0.210 | 51 | 0.000 | 0.856 | 51 | 0.000 |
| Q13 | 0.194 | 51 | 0.000 | 0.911 | 51 | 0.001 |
| Q14 | 0.232 | 51 | 0.000 | 0.866 | 51 | 0.000 |
| Q15 | 0.202 | 51 | 0.000 | 0.880 | 51 | 0.000 |
| Q16 | 0.205 | 51 | 0.000 | 0.888 | 51 | 0.000 |
abnormal distributions of data. Therefore non-parametric tests are more appropriate to be used.
In this research the significance level of 0.05 has been used. So if the probability of a particular demographic factor is less than 0.05, then the null hypothesis is rejected and considered as being ‘statistically significant and unlikely happening due to chance’ (
The survey participants comprise clients, project managers, consultants/designers and contractors/subcon- tractors. To make comparison between clients and contractors, these participants have been allocated into two groups-clients’ group (25 responses) and contractors’ group (26 responses). As project managers and consultants/designers work as clients’ representatives, they are included in clients’ group. Mann-Whitney is used in this research to examine and compare the two groups’ views. It can be concluded from the outcomes of the Mann-Whitney test that there is virtually no difference between clients’ group and contractors’ group in the views of the questionnaire except Q9 (
This research investigated and compared clients’ view and contractors’ view on competitive tendering in the Sudan construction industry. Despite their opposite positions in respect of tender price and different roles/re- sponsibilities, clients and contractors have almost the same view on the main aspects of competitive tendering. The questionnaire consists of comprehensive points of competitive tendering from various angles. Even though
| Significance Level | Null Hypothesis | Interpretation |
|---|---|---|
| P ≤ 0.05 | Rejected | Statistically significant & unlikely happening due to chance |
| P > 0.05 | Not rejected | Not statistically significant & likely happening due to chance |
| Mann-Whitney U | Wilcoxon W | Asymp. Sig. | |
|---|---|---|---|
| Q1 | 321.0 | 646.0 | 0.938 |
| Q2 | 277.0 | 628.0 | 0.351 |
| Q3 | 304.0 | 655.0 | 0.686 |
| Q4 | 325.0 | 676.0 | 1.000 |
| Q5 | 311.0 | 662.0 | 0.787 |
| Q6 | 304.0 | 655.0 | 0.686 |
| Q7 | 309.5 | 660.5 | 0.767 |
| Q8 | 314.0 | 639.0 | 0.832 |
| Q9 | 157.5 | 482.5 | 0.001 |
| Q10 | 317.0 | 668.0 | 0.878 |
| Q11 | 277.5 | 628.5 | 0.363 |
| Q12 | 283.0 | 634.0 | 0.420 |
| Q13 | 325.0 | 676.0 | 1.000 |
| Q14 | 280.5 | 605.5 | 0.389 |
| Q15 | 228.0 | 579.0 | 0.061 |
| Q16 | 323.5 | 674.5 | 0.977 |
competitive tendering has some disadvantages, it seems that this tendering method can still be efficient and effective to be used in the 21st century, as both parties are well aware of the advantages and disadvantages. Future research will be conducted in other countries to verify the finding of this research.
Byung Gyoo Kang,Mustafa Magdi Mohammed Elamin Elbashier,Boon Hoe Goh,Myung Kyu Song, (2015) A Comparative Study between Clients and Contractors on Competitive Tendering in the Sudan Construction Industry. Open Journal of Social Sciences,03,67-73. doi: 10.4236/jss.2015.37012