Abstract:
Companies must have the capability to deal with various bidding situations successfully in today’s highly competitive construction market. The first step that the companies need to consider is whether to bid or not to bid when they receive a tender invitation. The contractor’s decision is affected by various factors and influences. This decision is highly reliant to the specific project and the macro environment. It is difficult to make this crucial decision in a short time frame by the management team.
In Pakistan, bidding process has many flaws and short comings that need to be improved to make the process better. Only a few companies have proper departments for bidding. Not having professionals affect the percentage of winning bids as well as financial loss to the firm if they have made the wrong bid.
The present study investigated the factors affecting the bid/ no bid decision making and the focus group was on the medium to large sized contractors in the construction industry of Pakistan. A questionnaire survey was conducted to collect the data.The main objective of this study was to identify the main factors that affect bid or no bid decision of medium to large size contractors in Construction Industry of Pakistan.
Nine main factors used for evaluating bid no bid decision of contractors were identified by literature review. These main factors were divided into thirty sub factors which were ranked using severity index analysis. The top five sub factors for large sized contractors were sequenced as current financial capability of the client, history of client’s payments in past projects (considering delays, shortages), financial status of your company, terms of payment and consultant’s attitude, characteristics and stability in needs in the same order. The top five sub factors for medium sized contractors were sequenced as history of client’s payments in past projects (considering delays, shortages), current financial capability of the client, and availability of resources within region, consultant’s attitude, characteristics and stability in needs and financial status of company.
