An invitation to tender, or ITT, is a formal document distributed by the buyer which formally invites suppliers to bid for a contract of works (goods or services). It can be known as a call for bids or a request for tender.
An ITT is quite simply an offer for a supplier to apply to win the work. It is not a guarantee that the work will be awarded to the supplier. Indeed, ITT’s are usually distributed to up to a dozen organisations who the buyer believes may be capable of fulfilling the work.
Sometimes an ITT follows a PQQ (Pre-Qualification Questionnaire) which acts as a pre-screening stage to ensure that those invited to tender meet certain criteria. This is particularly common in the public sector.
Invitations to tender will usually be issued via email or through an online portal.
What is the difference between an Open ITT versus a Closed ITT?
An open ITT means that any vendor who can provide a guarantee of performance may offer their goods or services. A closed or restricted ITT means that vendors have been pre-selected or qualified through a process such as an expression of interest or PQQ. In this case only those who have ‘qualified’ are eligible to tender.
What does an ITT look like?
There is no set template for an ITT. The information contained within them very much depends upon the industry within which the Buyer operates. Broadly speaking, most ITTs will contain the following:
1. Introduction and overview
This may include detail on the company and background to the project.
2. Scope of work
The detail behind the goods or services that the Buyer wishes to purchase. The length of this section will often be dependent upon the complexity of the goods / services required. For example, it could include technical aspects, especially within sectors such as the construction industry, where technical drawings and plans may be required.
3. The tender process
This could include detail on the various stages of the tender process and anticipated timeframes, such as deadlines for submission and planned contract implementation date.
4. Assessment
The assessment is likely to take multiple factors into consideration. This could include:
- Commercial aspects such as price or contractual compliance
- Service capability such as ability to deliver, quality of provision
- Longer-term factors such as the ability to add value in other areas, strategic fit for the organisation
- Financial aspects such as the company’s financial track record
- Level of compliance with the ITT (did they understand all aspects of the ITT, is the bid in accordance with the instructions, have they adhered to timescales)
5. Conditions of contract
Outlining specific aspects of the contract which should be acknowledged upfront.
6. Feedback policy
The method by which feedback will be provided to bidders, usually including timeframes.