Survey slams 'huge' cost of tendering

The average spend on bidding costs by construction consultants and contractors is "huge", a survey by Reading University has revealed.
The results of the survey put the average cost of construction tendering at 3% of the value of the project, while the average pre-qualification costs run
to 1.5%.
"If you have to do both, that adds up to 4.5% and even then you might lose the bid," said Will Hughes of Reading University. "So when a contractor is winning one bid in five, that means 22.5% of its budget is spent on bidding costs - this is huge."
Philip Collard, managing director of Marketing Works, said: "Earlier estimates had already suggested that £3bn to £4bn is spent in construction on win-work activities. I wish the captains of industry would pick up on this.
"In the survey, companies were asked to split win-work activities into 33 categories, with one of these being 'copying and distribution of tender documentation to others'. The replies showed that 2% of turnover is being spent in photocopying and re-mailing documents, suggesting that e-bidding is the next obvious step for anyone looking to improve margins."
Don Ward, chief executive of construction supply chain body Be, said: "Some procurement routes are a con. Competing bids all contain design effort, which adds value. The client should be paying for this."
<F03C> How much do you spend bidding for work? To calculate your actual bid costs - and contribute to the on-going survey by the University of Reading - go to www.constructionmarketing community.com/research