Tenders can be invited in competition from a list of suitable contractors, with subsequent examination and recommendation on selection, or, alternatively, an offer price can be negotiated with one or more chosen contractors.
For reasons of transparency some clients may not be permitted to negotiate tenders directly with a preferred bidder. There is also a general belief that "best value" is achieved by competitive tendering.
Negotiation can follow a competitive tendering exercise but if this is seen as 'the norm" or common practice then there is a risk that contractors will not submit their best price on the basis that it will in any case be negotiated down. Negotiation of follow-on contracts is common practice and can save time and expense; the negotiation usually being on the basis of applying the previously tendered rates to the new contract, possibly subject to an inflationary uplift if there is some time between the original tender and the follow-on contract.
If tenders are to be negotiated then it is best to start with an element of trust between the parties and for there to be a degree of confidence in our skills and knowledge of current building rates and prices. We keep up to date with building costs by constantly analysing tender results and rates and can respond very quickly and effectively.