Open tendering is the preferred competitive public procurement method used for acquiring goods, services and infrastructure works. It is executed in accordance with established procedures set out in the procurement guidelines and detailed in the standard bidding
Open tendering is also known as open competitive bidding, open competition or open solicitation, and the procurement notices used to call for bids for these requirements are identified as: Invitation for Bids or Invitation to Tender.
The fundamental requirements of open tendering are that they should:
- Be open to all qualified and interested bidders,
- Be advertised locally (and internationally, when required),
- Have objective qualifications criteria,
- Have neutral and clear technical specifications,
- Have clear and objective evaluation criteria, and
- Be awarded to the least-cost provider, without contract negotiations.
It is presumed that this procurement method fosters effective competition and adds value for money; however, there are arguments to the contrary given that the open tendering method is strictly procedures-based and was primarily designed for the procurement of simple goods. As a result, it is not suitable for complex procurements where the focus is more on the output and outcome of the contracting process rather than on strict adherence to standards.
Some disadvantages of the open tendering process are:
- Lengthy timeframe for completion of the procurement action,
- Requires strict adherence to procedures,
- Assumes existing internal capacity for the completion of clear and precise specifications,
- Restricts suppliers‘ participation in determining the technical specifications,
- Limits the possibility of building long-term relationship with suppliers,
- Focuses only on a least-cost solution,
- Suppresses innovation, and Excessive formalism may limit supplier participation in the tendering process.