Tender process – case study

Jan 09, 2017

Nekkanti Mega Food Park

Bid Process Management
– Civil Works
Pre - requisites.

 Selection of contractor as per CVC guidelines

 Handing over encumbrance free site with statutory approvals

 Can initiate minor site development and road/plot marking before

PCB clearance but cannot start construction in full swing
 Ensuring ideal contract duration

 Freeze design

 Financial planning
Eligibility

• The contractor should have successfully completed at least one work of

similar nature in any one 12 months continuous period and costing more than 100
% of the estimated value or at least two similar works costing more than 50% of the
estimated value.
• Average Turnover not less than 100 % of the value of work, per annum in
last 3 financial years.
• The Contractor shall be a Class I Registered Contractor of CPWD or equivalent
of any State, Central or Quasi Government Institution. The contractor shall submit
an attested copy of the Registration certificate
• The Solvency certificate shall be for a minimum amount equaling 20 percent of
the (quoted tender price plus the amount of works on hand still to be executed) by
the Bidder.
Contractor Submission

• Complete credentials of the Bidder with respect to their financial and technical
capabilities to satisfy the “Qualification Criteria” as set out above.
• The jobs undertaken by the Bidder and executed during the last three
years, which satisfy the above “Qualification Criteria” along with brief scope of
work. Certificates of satisfactory project completion also need to be provided.
• List of litigation pending by/against the Company / Firms along with value.
• Details of own Plant and Machinery, Tools and tackles for Construction,
Infrastructure facilities.
• Organization Chart and details of Personnel.
• Audited financial statements / Annual reports for the past three years.
• Solvency Certificate from reputed banks.
Bid process Management

Type of contract
(QCBS/Sole
sourcing/Lump Financial bids Financial
sum/cost +fixed opened for
fee contract,etc qualified bidders Evaluation

Prepration of bid
documents (General Technical Negotiation with
conditions of Evaluation bidders
contract, BoQ etc)

Notice inviting Pre-qualification

tenders (News check and technical Final Pricing
paper AD) bid opening

Submission of
Clarification to pre- report to tender
Pre-Bid Meeting Award of Work
bid queries committee for
approval
Bid process Management
Notice Inviting Submission of
Expression of Technical
Bids by
Interest Evaluation
contractor

Evaluation of
Expression of Financial bids
Clarification to
Interest opened for Award of Work
pre-bid queries
qualified bidders

Package Submission of
wise/Location Financial report to tender
wise tender and Pre-Bid Meeting
Evaluation committee for
type of contract approval

Prepration of bid
documents
(General Request to bid to Negotiation with
Final Pricing
conditions of sucessful bidders bidders
contract, BoQ
etc)
General conditions of contract.
Condition Clause
Contractors submission with tender document
Bid Processing fee Rs. 10,000 + service tax (Not refundable)
EMD 1% of estimated value (Converted to PBG for successful contractor,
returned to other non-successful bids)
For Successful Contractor
Performance Bank 5% of contract value (will be returned to the contractor after
Guarantee defect liability period (generally 1 year))
Retention amount 5% in all RA Bills
(50% released with final bill and 50% after 6 months of final bill):
Penalty Clause (for time 0.5% of the total value of work or part there of per week upto 5 %
delay) of total contract value
SPV to successful contractor
Mobilization Advance 10% Mobilization advance on Bank Guarantee. (will be
periodically deducted from RA Bills (10%))
Bid document - contents.
Book Contents

Book 1 Invitation for Bids containing Sections as below

Section I Instructions to Bidders
Section II Forms of Bid and Qualification Information

Section III Conditions of Contract

Section IV Contract Data
Section V Forms of Securities
Book-2 Specifications
Book-3 Drawings
Book -4 Bill of Quantities
Discussion points – Bid process management
 Type of contract (Least cost / QCBS )

 Package wise contract

 Tender plan - Sequence

 Compound wall

 Site development and roads

 CPC / PPC

 Cold Storage

 Water supply and sewerage system

 External water supply

 Electrical works

 STP / ETP
Tender process - timeline

Process Timeline

NIT, Tender issue T

Pre-bid meeting T+10 days

Tender submission & Opening T+15 days (or T+15 days)

Technical and financial evaluation T+22 days

Financial Negotiation T+27 days

Award of work T+30 days

Bid Process Management
- Machinery
Pre - requisites.
 Selection of contractor as per CVC guidelines

 Eligibility for tender (Experience, turnover, etc)

 Type of bid ( Two envelope / Least cost etc)

 Conditions (EMD / Performance guarantee )

 Specifications with details of

 Equipment specification sheet

 Type (Supply / installation / AMC
 Softwares & Configuration
 General conditions of contract
 Period
 Negotiation
 Price condition / payment terms etc
 Insurance
 Warranty / AMC – Duration
 Special Instructions
Grant Process
Conditions for Release of Grant
 1st instalment of Grant – 30% of total Grant (within 10 months from
date of issuance of Final Approval)

 Establishment if TRA account

 Appointment of State Govt, nominee on the board of SPV for a tenure co-
terminus with the operationalising the project
 Increase in authorised capital to allow stipulated equity contribution
 Expenditure of at least 10% of the Eligible Project Cost
 Award of contracts worth at least 30% of Total Project Cost including at least 20%
of approved components of Basic Enabling Infrastructure

 2nd Instalment of Grant – 30% of total Grant

 Utilisation certificate for 1st installment of Grant
 Proportionate expenditure by SPV of the Eligible Project Cost equivalent to % of
grant released as 1st installment
 Proportionate contribution by SPV in TRA account equivalent to % of grant to be
released as 2nd installment
 Proof of possession of land for all PPCs along with construction schedule
 Commencement of construction of SDF sheds for MSEs
Conditions for Release of Grant
 3rd instalment of Grant – 20% of total Grant
 Utilisation certificate for 2nd installment of Grant
 Proportionate expenditure by SPV of the Eligible Project Cost equivalent to % of
grant released as 2nd installment
 Proportionate contribution by SPV in TRA account equivalent to % of grant to be
released as 3rd installment
 Completion of at least 40% of construction of PPCs and Expenditure of 40% of
total proposed cost for PPCs
 Completion of at least 50% Construction of of SDF sheds
 Allotment of at least 25% of allotable plots
 Commencement of construction of SDF sheds for MSEs

 4th Instalment of Grant – 20% of total Grant

 Utilisation certificate for 3rd installment of Grant
 Expenditure of 100% envisaged contribution of SPV including term loan and
equity on approved project components
 Allotment of at least 75% of allotable plots
 Commencement of operations in at least 25% of the units
 Completion and commissioning of Processing Unit(s) of Anchor Investor in the
Park
Way Forward
Action Points
Statutory Clearances
 Panchayat Approval
 Submission of requisite forms for PCB and DTCP Approval
 Ground water clearance
Bid Process
 Formation of Tender Committee
 Appointment of Administrative head for park (CEO)
 Grouping of tenders (Packages)
 Finalization of technical specification for machinery
Administrative
 Establishment of TRA account
 Appointment of State Govt, nominee on the board of
 Increase in authorised capital to allow stipulated equity contribution