Decision criteria for Tenders and Quotations

23/03/2024 0 By indiafreenotes

Tenders are formal and structured invitations to suppliers to submit a bid to supply goods or services. They are often used by governments, public sector organizations, and large private companies to ensure transparency, fairness, and competitiveness in procurement processes. Tenders specify the goods or services required, the terms of the contract, and the criteria for selection. Responding to a tender involves preparing a detailed proposal, including pricing, timelines, and compliance with the specified requirements. The tendering process is designed to eliminate bias and favoritism, ensuring that the contract is awarded based on merit, such as price, capability, and experience.

  • Price:

The cost of the tender offer is a crucial factor, but it’s evaluated against the value and quality of the service or product offered.

  • Quality:

The quality standards of the products or services proposed, including compliance with specifications and standards.

  • Capability:

The supplier’s ability to deliver the required goods or services, including their experience, resources, and technical skills.

  • Delivery:

The supplier’s ability to meet delivery timelines and the reliability of their supply chain.

  • Financial Stability:

The financial health of the supplier to ensure they can sustain service delivery over the contract period.

  • Sustainability and Environmental Impact:

Consideration of the supplier’s environmental policies and practices, including sustainability in the supply chain.

  • Innovation:

The supplier’s ability to offer innovative solutions that could provide competitive advantages.

  • Risk Management:

Assessment of potential risks involved with the supplier and their mitigation strategies.

  • Aftersales Service:

The quality of support and maintenance services offered post-purchase.

  • Compliance with Legal and Regulatory Requirements:

Ensuring the supplier adheres to all relevant laws, regulations, and ethical standards.


Quotations, or quotes, are written estimates provided by suppliers outlining the price and terms under which they are willing to supply goods or services. Unlike tenders, quotations are usually less formal and can be solicited from a single or a small number of suppliers. Businesses request quotations when they need to understand the cost implications of a purchase before making a decision. A quotation details the prices, quantities, and specific conditions related to the sale of goods or services. It becomes a binding contract once accepted by the buyer, outlining the terms of the transaction, including delivery, payment, and any other conditions agreed upon.

  • Cost-effectiveness:

Evaluation of the quotation price against the budget and the overall value it brings.

  • Specificity:

How well the quotation addresses the specific needs and specifications requested.

  • Flexibility:

The supplier’s willingness to adapt to changes or customize offerings as per requirements.

  • Payment Terms:

Favorable payment terms that align with the organization’s cash flow and financial planning.

  • Validity Period:

The time frame for which the quoted price is valid, ensuring it aligns with the project timeline.

  • References and Past Performance:

Historical performance and reliability of the supplier based on references or previous engagements.

  • Quality Assurance:

 Guarantees or warranties offered to ensure the quality and durability of the products or services.

  • Supplier Relationship:

The potential for building a long-term relationship with the supplier for future business.

  • Technical Support:

Availability of technical support and training to use the products or services effectively.

  • Confidentiality and Data Security:

Measures taken by the supplier to protect sensitive information and ensure data security.