Which procurement method to use

The problems associated with the traditional process can be solved by moving the responsibility evaluation from after bid opening to before bid opening — by prequalifying bidders in a two-step process.

In the first step, contractors are evaluated based on various qualifications-based criteria, such as past performance. Only those contractors meeting a minimum threshold are invited to submit a bid. Some of the advantages include:. Some people are concerned that limiting the number of bids received may lead to higher costs. However, the savings from eliminating project cost overruns, delays, and poor quality from less qualified contractors are likely to outweigh this expense.

An important variation of Design-Bid-Build is multi-prime contracting. In this method, the owner holds separate contracts with contractors in various construction work disciplines, e.

Using this approach, the owner or its construction manager, manages the overall schedule and budget. Projects in each construction discipline are bid separately, allowing the procurement manager to award construction contracts on the first portions of the project as soon as the respective aspect of design is completed.

The flexibility of this approach is a major benefit, when time of performance is a key factor. The owner has more control over the project schedule and sets the timeline for bidding individual portions of the work. Furthermore, the owner has the potential to realize savings by directly procuring major material items, such as structural steel or major mechanical equipment, and avoiding contractor mark-ups.

Research has shown that public construction projects organized with multiple prime contracts have 5 percent lower direct costs than those with a single prime contract. In Best Value Source Selection, contracts are awarded to the provider with the best combination of performance qualifications and price. Value is clearly a subjective term, but it can be quantified through multiple, weighted criteria and judged by a panel of evaluators.

It is important to determine non-price criteria and their relative importance based on the context of the bid: the type of project, scale, and required completion date.

Furthermore, this procurement method should help to reach clients main expectations, such as not increasing project cost, build within the expected construction time and many more.

Before moving on to procurement methods in construction, we should discuss the factors to be considered when deciding a procurement method or contract type.

Below are the key factors to choose suitable procurement method for a construction project ,. Below, we have described factors, and requirements with examples should consider before finalising procurement method. They have signed an agreement with the building owner, and they want to do particular modification to the building before commencing the operations. However, time is a critical thing here because they already started the paying rental for building.

Still, the building does not make any revenue at the period of modification. Budget or cost is a primary concern for all the clients. As an example- A person wants to build a house. He or she has carefully made some savings and wants to build the house within the money have, and do not want to exceed the budget. In this kind of situations, the procurement method selected should ensure there will no any budget exceeding. In some projects, the client wants to fulfil the maximum expected quality.

As an example- A client seeks to build a hotel. Furthermore, they want to build it with high-end finishes. The client has checked and selected all finishes, and they do not want to deviate any of it. Project requirements and restraints can make significant role when deciding the procurement root. When the government become a client restriction can come in. So procurement root should be very transparent for government projects.

Risks involved in the projects can affect certain procurement roots. Visit emeraldpublishing. Answers to the most commonly asked questions here. To read the full version of this content please select one of the options below:. Other access options You may be able to access this content by logging in via your Emerald profile. Rent this content from DeepDyve. Rent from DeepDyve. If you think you should have access to this content, click to contact our support team. Contact us.

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Delay and disruption.