Chapter 3 Common types of tender processes
There are three common tender processes.
Request for tender (RFT)
This process is the most common. It is used when:
- the scope of the required supply is known;
- price is the most important selection criteria;
- documentation and contract conditions have been finalised; and little or no negotiation is required.
Request for proposal (RFP)
RFPs are more often used when there are elements of uncertainty to a project, this may include:
- technology or procedures are new or being used in new applications;
- documentation has been developed but not finalised;
- the scope of the market is not fully known; or
- a purchaser is looking for innovative options.
Negotiations usually take place with one or more proponents before a contract is entered into.
Request for an expression of interest (REOI)
This process is more often used when:
- the scope or identity of the potential market is not known;
- feasibility is still being tested;
- a small number of better suppliers can be identified early to save the cost of assessing a lot of tenders;
- documents have not been fully developed and market input is needed; or
- there may be useful, but unknown, technologies in the market.
A short list of potential contractors are then invited to submit full tenders or proposals.