Selecting The Client
Selecting The Client
Selecting The Client
AWARDED CONTRACT
Consultants
Subcontractor Subcontractor
The Owner does not pay General Contractors to prepare BID package/proposal.
The Owner develops BID Package internally or through 3rd parties. RFP JC
The Owner can BID out the project using any of the following options:
1. Design + BID + Construction
Note: Designer can be a General Contractor (one of the bidders!)
2. Design/Build BID
3. Multiple prime approach
3. Construction Management
Tendering considerations
RFP – Request for
PRIVATE TENDER Proposal
In order to participate in a Private Tender, your company will need to:
Have experience in recent similar projects (Technical Capability)
Have a good relationship with the Owner (Preferable, not always a key ingredient)
Financial capability
RFP Magna
Most of the Private BIDs have the following items in common:
Lump Sump Contracts or Maximum Price Guarantee.
In minor cases they use Unit Price Contracts
Contracts
Foreign Customers BID out projects under Design/Build Scheme
They provide Basic Engineering Design (“BED”) and accurate specifications
The General Contractors need to quantify the project and submit their proposal (take Risk)
Usually under the Master Format (BID document) http://es.scribd.com/doc/24615899/CSI-Master-Format-2004
Most of the local Customers like to BID projects under the Design-BID-Build Scheme
Using a Catalogue of Concepts
Major Concern: Information does not match or it is Incomplete! (Catalogue of Concepts vs
Drawings vs Specs) and Quantities of the different concepts are not correct (Who takes the Risk?)
Tendering considerations
RFP – Request for
Proposal
PUBLIC TENDER
General Contractors need to prequalify complying with Public Office screening process. (local, estate or federal)
NEED TO COMPLY AND FOLLOW THE LAW-PROCEDURES!
If your proposal does not comply with the Law, it will be disqualified (Ley De Obras Publicas y Servicios
Relacionados “LOPSRM”)
Another option, General Contractors can download BID packages directly on the official government pages
BIDs are reviewed directly by the Government Entity and the committee they have established
The Government Entity can decide on whichever proposal suits it better, usually they select based on the lowest
bidder and the GC MUST comply 100% with RFP and LOPSRM.
Sometimes you do not know against whom you are bidding the project. (sometimes you do, tricks…)
The Government Entity does not pay to General Contractors to prepare BID package/proposal.
Proceso de
The Government Entity develops the BID Package internally or through 3rd parties. Licitación
The Government Entity usually Tenders out the project using the following option:
Licitación CFE
Design BID + Construct BID strategy
*Designer can not be a General Contractor (usually designer does not BID)
*The Government Entity provides a Catalogue of Concepts and Specifications (Unit Cost
Approach) https://compranet.funcionpublica.gob.mx
Tendering considerations PRELIMINARY
ENQUIRY
To make a judgment on whether to tender, contractors must be given the following:
Client
Details of the client. Who are they?
Full particulars of consultants, including their duties and responsibilities.
Particulars of proposed site supervision to be provided by the Owner or consultants.
A description of tender documents, their expected date of issue, period available for tendering, acceptance period
for the tender and time when unsuccessful tenderers will be notified.
Whether the project has been the subject of a previous invitation to tender.
Latest date for receipt of acceptance of invitation to tender.
The number of tenders to be invited.
Project details
The location of the proposed works, including preliminary drawings and a site plan.
Description of the project.
Approximate cost of the project. Some client will tell you and some will not.
The date for commencement of the contract. WHY IS THIS IMPORTANT??? HR availability
The period for completion. Details of any phasing or Beneficial Occupancy.
Access Problems. Congested site? Reforma?
Tendering considerations PRELIMINARY
Project details (continuation) ENQUIRY
Special operational space requirements.
Ground conditions.
Sufficient dimensions and specification details to permit evaluation of the project. In which procurement method
they will not provide it???
Details of work by nominated sub-contractors, approximate value, and names if known. For which procurement
method this applies???
An indication of health and safety issues. Are we going Pemex? OSHA? God’s will?
Form of contract and contract particulars
Form of contract to be used.
Provisions for liquidated damages.
Proposed amendments to standard forms of contract and appendix.
If possible request these, usually they are negotiated before signing the contract:
Details of interim payments.
Retention conditions.
Bonding requirements +Details of insurance + Warranties and insurance policies required
Provisions for fluctuations in cost.
Tendering considerations PRELIMINARY
ENQUIRY
The initial decision to tender is made by the Development Manager, often in consultation with the Cost
manager and Office Director.
Matriz de
Not so fast…… lets analyze the risk more objectively Selección
4.4 Decision to Tender
Review the Information Provided in the RFP
To tender all the information for Pre-selection is required:
KEY INFORMATION OF THE PROJECT: TECHNICAL INFORMATION OF
Description of the Project’s scope of work THE PROJECT:
What document is the one that rules (governs) above the other ones? (Basis of your proposal)
Review the Information Provided in the RFP
Bearing capacity of the ground and seismic factors Hydrology
Geotechnical Study
Study
Water Table
Expansive Clay? Preliminary
Geotechnical
Underground Laminar Flow. Do you need to add a filter?
Can the cut material be reused to backfill? Does it need to be upgraded? (Compare costs-vs imported
bank material)
Types of Rock. (It is needed a special permit from the Army “SEDENA” to use explosives)
Recommendations for foundations, earthwork structure, location of approved bank materials.
Land Survey
Request the recommendation for the type and thickness of the asphalt (Light and Heavy Duty)
Site Levels, Coordinates, Official bank mark, Utilities Location, Street levels, Trees, Special Items on site
With this information, the Final Floor Level can be determine and the “balanced” site can be achieve
(cut/fill analysis)
“UTM” Universal Transversal de Mercator,
Hidrological Study
http://es.wikipedia.org/wiki/Sistema_de_Coordenadas_Universal_Transversal_de_Mercator
Understand the Pluvial Catch Basin. You base your pluvial design on it? Does a Detention Pond is
needed?
Return Period, Intensity, Incoming Pluvial Water.
Note: all rivers, creeks, lagoons, etc.. Are Federal Property, therefore a special permit is needed to relocate
them
Review the Information Provided in the RFP
Type of Contract (Lump Sump, Unit Price, Maximum Guarantee Price)
Scope of Work
Bonds (advanced payment, performance-completion of contract, warranty period)
Insurance (Builders Risk 100% of contract value, General Liability)
Milestones (Beneficial Occupancy, Substantial Completion)
Penalty- not accomplish Substantial Completion (0.2% per day, topped to 20 calendar days)
Payment of invoices: Process, Calendar of Payments
Change Orders
Safety items
Environmental Items
Confidentiality
Permits (Construction License) Agreement
Close Out items (As Build Dwgs, IMSS-social security, Equipment turnaround, punch list, etc..)
Cancellation or suspension of Contract by both parties
Confidentiality (“FCPA” = Foreign Corruption Policy Act)
Review the Information Provided in the RFP
Is the information provided complete? If not, request additional information through an RFI
Can it be generated? Is there sufficient time to complete the missing information?
The important consideration is to present a complete and supported proposal.
Do not share this information with the customer!…He can steal it and used it with another
company.
If you do not have sufficient time to generate the pending information, you should
specify your assumptions in a document within your Cost Proposal, “ASSUMPTIONS”
Have we completely understood the scope of work? Do we have experience and the technical
capability to execute this type of project?
Can we execute the project? Do we have the resources? Any specific environmental item?
Does the scope of work calls for any special Design or Construction item in which we do not have
previous experience?
Investigate in detail. Seek professional input or assessment RFI
Cooling or Freezer chambers, Press Pits foundations, Explosion relief walls or roof.
Does the scope of work requires for any special equipment?
Lead time to order, special utilities connection, setting/Installation
Elevators, Cooling Towers, Compressors, etc.
Review the Information Provided in the RFP
RFI´s «Request for Information»,
Can it be generated? Is there sufficient time to complete the missing information?
If the information provided in the RFP is incomplete or not clear, you can ask any
question related to the project to the Client (use special format AIA, “RFI”)
The RFI´s can be use to:
Guide other bidders to quote the same item or under the same circumstances
Learn the strategy that other Bidders are using to prepare their proposal
Understand the project’s scope of work and clear up any misunderstood items
Adendas
Are part of the bidding process RFI
Safety Manual
11. Formal Communications (Construction
Log Book) Change Order
13. Quality (3rd party), Right of the Owner (Specify who will do it) Down Payment
to do Quality test Bond
14. Safety standards What standards will we have to comply to? Annex, Safety Manual
15. Change Orders Definition and who will approve it?, Time of execution? Unit Cost? Markup?
Annex
16. Bonds Which will we use (1. advanced down payment, 2. Performance, 3. warranty, others?, with whom
should I buy them? NEVER FORGET TO CANCEL THEM!!!!!!
Performance
17. Insurance Duration, is it normal or standard practice? Bond
18. Warranty Period Duration, is it normal or standard practice? Want to become maintenance?
19. Contract Value Estimate Breakdown by concepts, for a Lump sum never present your overhead
Annex
20.Payment application procedure Warranty Bond
Define “x” period of time. Penalties if the customer Annex
doesn't pay on time Payment
Application
Parts of a Contract Close Out
21. Close Out items What is need to request he final payment Annex
22.Responsibilities (labor, demands, IMSS, Usually the General Contractor is the sole
taxes) responsible
24.Contract suspension Who has the power to do this, and how to proceed
25.Applicable laws and Jurisdiction In case of dispute, under which jurisdiction
26.SIGNATURE!!!!!!! Have they returned it signed from Tokio?
27. Retainage 5% retainage, this amount is paid when the Substantial Completion is achieved
Parts of a Contract - Summary
The more detailed are the Annexes & Exhibits, the
less Risk for your company!! Signed
Contract
It is important to read and understand the contract - If needed, hire a lawyer!
NOT Signed
First sign the contract, prior to starting construction!. Contract
A contract is an agreement between two parties, therefore you have the right to change, add or
delete any item. Remember, once signed, you have to comply! Or………
Should include all verbal agreements negotiated with the owner / client.
Regarding Payment:
The invoice should be paid by the owner 2 or 4 weeks after it has been approved.
Recommendation to add to the Contract:
That the applications should be approved by the Owner in a period no longer then 7
days after it has been formally submitted.
That in case the Owner does not pay in the agreed time, the General Contractor can stop
the execution of the construction and the Owner will need to pay interests (10-12% anual rate).
Be able to charge for the materials already on the site.
Parts of a Contract – Deal Breakers
Run !!!!
1.- Cláusulas que mencionen que pagaremos aún y cuando no nos paguen.
2.- Que paguemos todos los gastos en caso de haber algún desacuerdo.
3.- Que se tenga que indemnizar el proyecto al 100% si es responsabilidad del cliente y para su
propio beneficio.
4.- Que no puedas cobrar por retrasos por el cliente.
5.- Terminación del contrato que solo el cliente tenga que pagar por el material y lo que este
puesto en obra el día de la terminación de la obra, hay compromisos ya hechos y pagados con
proveedores y subcontratistas!!