Effective Management of Suppliers - Assignment Example

The inaccuracies in bidding can be costly to the respondent or lead to losses to the tendering firm. Introduction and Articulation of the problem A tender is handled as an offer to perform some work for a certain sum of money (firm price), or a certain quantity of benefit (cost plus or cost reimbursement). The tender which is presented by the competing companies is usually based on an invoice of amounts, an invoice of estimated quantities or other requirements which allow the tenders to obtain greater degrees of accuracy or precision which is known as the statement of work.

The tendering procedure is widely used in both the public and private sector for the purchase of products or services often referred to as the procurement process. Both the respondent and the tendering party need to be careful of guaranteeing the precision of the certification interchanged and claims made during the tendering and procurement procedure. Where a declaration is found to be incorrect or deceiving, a wide and common legal disclaimer as to the precision of the declaration will be inadequate to get over such a finding.

The exchange of information, in the tendering procedures, especially in the viewpoint of discussing and identifying costs will be appropriate in an evaluation of the issues where a following claim of deceptive and misleading conduct occurs in regards to the original documentation of the tender. The choice in tendering demonstrates the significance of guaranteeing the precision and completeness of details included in tender records and otherwise offered during a tendering procedure as well as representations made during that procedure.

The attention of this requirement has often existed for the concerned individuals planning the proposal but organisations using the process of tendering to entice providers need to also be cautious in guaranteeing the details they provide to prospective bidders at the pre-contract level and during the process of tendering is not deceiving in any way. Accuracy in the bidding process should be upheld because the work may be overvalued leading to the party offering the work paying more for the job while they could have incurred lesser costs.

The tender may also be valued at a lower price than it should leading to the firm offering the job incur losses or make insignificantly small profit. Besides pricing, there is need for accuracy when specifying the time you will take to complete the tendered job. Accurately setting a date will mean that there will be ease in meeting the specified deadline. Literature review An estimate can be precise, low or great. A precise estimate usually results in the most cost-effective project price. In cases of either an underestimation or an overestimation, it often results in higher actual expenses.

According to Aibinu and Pasco (2008), causes of inaccurate estimates in the project may occur from two places: prejudice linked with the project itself and prejudice associated with the calculation methods used and the working environment Preparing the cost estimate of the work is one of the most challenging tasks in managing a project because it has to be done before the accomplishment of the project (Oberlender 1993). Estimation of the price of establishing projects requires extensive skills and knowledge.

Because of insufficient design details in the early stages of the design, it is particularly hard for quantity surveyors to arrive at an accurate price estimate. A