bid calling - all star training · made, the contracting officer can request from the bidder a...

© 2016 All Star Training, Inc. 1

Bid Calling

A Call for Bids

A call for bids or call for tenders or invitation to tender (ITT) (often called tender for short) is a special

procedure for generating competing offers from different bidders looking to obtain an award of

business activity in works, supply, or service contracts. They are usually preceded by a pre-

qualification questionnaire (PQQ).

Types of Calls for Bids

Open tenders, open calls for tenders, or advertised tenders are open to all vendors or contractors who

can guarantee performance. Restricted tenders, restricted calls for tenders, or invited tenders are only

open to selected pre-qualified vendors or contractors. This may be a two-stage process, the first stage of

which produces a short list of suitable vendors.

The reasons for restricted tenders differ in scope and purpose. They are called because there is

essentially only one suitable supplier of the services or product, there are confidentiality issues such as

military contracts, there are reasons for expedience such as emergency situations, and there is a need to

weed out tenders who do not have the financial or technical capabilities to fulfill the requirements

Origin of the Term

Dictionaries explain the etymology as coming from Old French tendre, which means, "to offer". The

following is apparently a false etymology: When merchant ships arrived at a port of call, they would

post a notice describing the goods they wished to buy or sell. This notice was delivered ahead of the

ship by a tender—a small boat—and hence the process became known as tendering.

Double Envelope System

In an open bid or tender system, a double envelope system may be used. The double envelope system

separates the technical proposal (statement of work) from the financing or cost proposal in the form of


two separate and sealed envelopes. During the tender evaluation, the technical proposal would be

opened and evaluated first followed by the financing proposal. The objective of this system is to ensure

a fair evaluation of the proposal. The technical proposal would be evaluated purely on its technical

merits and its ability to meet the requirements set forth in the Invitation without being unduly skewed

by the financing proposal.

Tender Box

A tender box is a physical mailbox that is used to

receive the physical tender or bid documents. When

tender or bid is being called, a tender or bid number is

usually issued as a reference number for the tender box.

The tender box would be open for interested parties to

submit their proposals for the duration of the bid or

tender. Once the duration is over, the tender box is

closed and sealed and can only be opened by either the tender or bid evaluation committee or a member

of the procurement department with one witness.

Security Deposit

Registered contractors are usually required to furnish a bond for a stipulated sum as security or earnest

money deposit to be adjusted against work done.

Locating Tenders

Public sector organizations are legally obliged to release tenders for works and services. In the majority

of cases these are listed on their websites and traditional print media. Electronic procurement and

tendering systems or e-procurement are also increasingly prevalent. A number of companies provide

subscription alert services, which send notifications of relevant tender documents to the subscriber.


An array of private organizations also assists businesses in finding out about these tenders. Cost may

vary from a few pounds a week to a few hundred. Because of the special language and sometimes

difficult-to-grasp procedures, some organizations also offer company tender writing training, or do the

writing for them.

First Price Sealed Bid

Sealed first-price auction, also known as a first-price sealed-bid auction (FPSB). In this type of auction

all bidders simultaneously submit sealed bids so that no bidder knows the bid of any other participant.

The highest bidder pays the price they submitted. This type of auction is distinct from the English

auction, in that bidders can only submit one bid each. Furthermore, as bidders cannot see the bids of

other participants they cannot adjust their own bids accordingly. This kind of bid produces the same

outcome as Dutch auction. Sealed first-price auctions are commonly used in tendering, particularly for

government contracts and auctions for mining leases.

Sealed Bidding Law and Legal Description

A sealed bid is a document enclosed in a sealed envelope and is submitted in response to invitation to

bid. Sealed bids received up to deadline date are generally opened at a stated time and place usually in

the presence of anyone who may wish to be present and evaluated for award of a contract.

According to 48 CFR 14.101, the elements of sealed bidding are preparation of invitations for bids,

publicizing the invitation for bids, submission of bids in sealed covers, evaluation of bids, and contract

award.

Generally, reasonable time is given to prospective bidders to prepare and submit bids in all invitations.

After the opening of bids, contracting officers examine all bids for mistakes. In cases of any apparent

mistakes and in cases where the contracting officer has reason to believe that a mistake may have been


made, the contracting officer can request from the bidder a verification of the bid, calling attention to

the suspected mistake.

A sealed bidding is considered to be a preferred method to award goods and services contracts. Such

contracts are awarded to the bidder whose bid meets the

requirements set forth in the invitation for bids and to those

who submit the lowest bid price or lowest evaluated bid price

United States differs from England

Bid calling in the United States differs from England. We have

written extensively about auctioneer bid calling. For those in

the United States, bid calling is nearly all uniform in one respect, where bid calling in England is

distinctly different. How does bid calling in the United States differ from England? In the United

States, auctioneers customarily communicate with the audience two numbers: The “have” and the

“want.” For instance, an auctioneer in Nebraska, for example, would almost assuredly ask for a bid of

$500 and if a bid was made for $500, the auctioneer would then communicate to his audience that he

“had” a bid of $500, and “wants” a bid of $550. This type of exchange between the auctioneer and the

audience would continue, such as, “I have $500, and I want $550, $550, $550 .. I’m at $500, bid $550,

$550, now $550 …”

In England, however, an auctioneer in London would typically suggest a starting bid, for example, by

saying “Who would start the bid at $500?” Once a bid of $500 was made, the auctioneer would say, “I

have $500" or “I’m at $500" and basically wait for the next bid to be made. Once a hand went up, or


otherwise another bid was made, the auctioneer would accept this bid and state a new amount —

typically the amount set by the pre-established increments of the auctioneer. For example, if the

increments at around $500 were $50, the next bid would be $550.

The key difference here is that in England, the “want” is not expressly noted, but rather implied. In the

United States, the “want” is expressly communicated.

Are there advantages or disadvantages to either of these methods? Apparently not. It seems more so

that bidders prefer whichever method has become familiar. Bidders accustomed to English style bid

calling find the United States method unusual, and those bidders in the United States find the English

style unusual.

Finally, the other key difference typically noted is the speed in which the bid calling is communicated.

In the United States, most auctioneers talk fast — faster than those auctioneers in England. However,

this isn’t to say that the auctioneers in either culture actually sell items quicker than the other. The

actual sale speed (minutes per item, or items per minute) might favor the United States auctioneers just

a bit, but isn’t greatly different.

As more and more people become familiar with other countries, and other customs, it is becoming less

unusual to hear English-style bid calling in the United States, and United States-style bid calling in

England. In fact, Sotheby’s and Christie’s in New York still utilize English-style bid calling, due to

their English heritage and tradition.

Bid Calling Calories

CBS News report from 2005 notes that about 45 million Americans diet each year. For 2005, the

United States had household population of 288.4 million, so we might conclude that about 16% of the

U.S. population is dieting at any one time. Auctioneers who bid call expend energy, and therefore bid

calling does burn calories — but how many? It appears no formal study has been performed, but like

activities (such as vigorous singing, both standing and sitting) has been evaluated.


Based upon known calorie burning numbers for singing, it appears that one hour of bid calling while

sitting burns about 100 calories and one hour of bid calling while standing burns about 132 calories.

We also note that men typically burn more calories than women for the same activity. Thus, male

auctioneers would burn a bit more than our above numbers, while female auctioneers would burn a bit

less.

Too, calorie burning varies by a person’s weight. Generally, heavier people burn more calories than

thinner people given the same activity.

Given that it isn’t unusual for an auctioneer to bid call for several hours for an auction, it appears that

five (5) hours of bid calling burns approximately 550 calories, on average.

Other than burning calories, bid calling has other physical effects. Heart rate is increased, and the entire

activity is normally aerobic in nature. Such activity conditions the heart and lungs with increased

oxygen and increases muscle tone.

Vigorous bid calling can be anaerobic in nature, which tends to

produces lactic acid. This can accumulate in the muscles and is

responsible for muscle ache, and possibly also fatigue.

It appears bid calling is generally a healthy activity — and it

burns calories.

Unethical Bid Calling

I’ve decided to start a series of posts on what I would characterize as creative, unethical, and probably

illegal bid calling techniques I’ve witnessed over the years. While I believe most all auctioneers act in

an ethical, moral and legal manner, there are some auctioneers acting the opposite, while bid calling,

and it is quite concerning.

Standard Bid Calling


Standard bid calling in the United States involves the auctioneer suggesting a price a bidder might bid,

the bidder bidding that amount, and then the auctioneer asking for a higher bid. Commonly, these two

numbers (what is bid, and what is desired) are called the “have” and the “want.”

For example, an auctioneer might say, “I would like $100 for this item,” and as a bidder raises his card,

the auctioneer would continue, “I have $100, and I’d like $125 …” and so forth. However, way too

many auctioneers (even if that was only 1) bid call in creative, unethical and probably illegal fashions.

The Shadow Bidder

In this scheme, as an example, the auctioneer has two bidders, Mary and Julie. Mary bids $25 and the

auctioneer’s hand moves over to point toward Julie with the following statement: “I have $25 and now

$27.50 and give me $30.” In other words, Julie is asked to bid $30 because the previous bid is $27.50

— although it isn’t, but rather $25, which Mary bid. The $27.50 bidder is actually Mary’s shadow (or

Julie’s), which bid the next bid, causing Julie to bid one higher increment.

This technique continues as Julie bids $30, the shadow bids $32.50 and Mary is asked to bid $35. Mary

does bid $35 and the shadow can even raise the increment to bid $40, so Julie is asked to bid $45. This

is typically continued until the auctioneer senses one bidder is about to stop bidding, and of course, the

shadow stops bidding too.

I witnessed this all day at an auction not too long ago. Only one bidder stopped bidding while the

shadow was “on,” and in that case, the auctioneer said sold to his own number, as he didn’t have any

bidder on at that time (only the shadow). Unethical bid calling? Yes. Creative? Yes. Illegal? Maybe

not, as we’ll explore in a future post, but not a good excuse to conduct this type of bid calling

nonetheless.

Proxy Bidding

The practice of a bidder putting in a sealed bid on a property because they are unable to attend the

auction in person. The proxy bid will need to be received by the auctioneers prior to the auction and


will need to detail the bidder's maximum bid price. The auctioneer will only open this sealed bid whilst

up on the rostrum and will bid on the proxy bidders behalf.

Reserve Price

The reserve price is the lowest amount for which a property will be sold. This is never an amount in

excess of the guide price and it is rarely disclosed. Very occasionally, the property is sold subject to a

declared reserve which is publicised during the marketing campaign. The reserve price is simply put in

place to protect the vendor's position.

Spotter

The auctioneer will often have a spotter, who will stand next to the auctioneer looking at parts of the

room the auctioneer is not covering at any particular time. The auctioneer may not wish to look away

from the bidder when he is in the process of 'knocking down' a property, and thus relies on the spotter

to identify any further bids in the room.

Auctioneer

Mike Brandly, Auctioneer, CAI, AARE has been an

auctioneer and certified appraiser for over 30 years. His

company’s auctions are located at: Mike Brandly,

Auctioneer, Keller Williams Auctions and Goodwill

Columbus Car Auction. He serves as Adjunct Faculty at

Columbus State Community College and is Executive

Director of The Ohio Auction School.

Nebraska Auctioneers Association (NeAA)

(Aurora, NE) The Nebraska Auctioneers Association (NeAA), a 230-member trade organization

representing the auctioneering profession of Nebraska, announced the winners of the 2010 Bid


Calling & Ringman Championship on Sunday, August 1, 2010. The Championship Competition

was held in conjunction with the Hamilton County Fair in Aurora, Nebraska. Twenty-nine

contestants competed for the title of Bid Calling Champion and nine contestants competed for

the Ringman Champion title in a live auction with more than 300 spectators in attendance.

The Bid Calling competitors were judged on presentation, chant, voice quality, body language,

and other elements of effective auctioneering along with a personal interview. Justin Schultis,

Schultis & Son, Inc, Fairbury, NE, won the title of Champion. The Reserve Champion was

Tyler Runge, Buss Action & Realty Co., Columbus, NE. Placing Runner- up was Regina

Andrijeski, Brott Auction Service, Curtis, NE. Receiving the Rookie of the Year award was

Jeremy Crozier, Gary Juranek & Associates Auctioneers, Persia, IA.

The Ringman competitors were judged on presentation, enthusiasm, audience observation, and

communication with the auctioneer along with a personal interview. Winning the Ringman

Championship title was Russell Puchalla, Heartland Auction Co., Roca, NE.

Rounding out the auction finalists were: Justin Banzhaf, Banzhaf Angus & Auctioneer,

Bellevue, NE; Dallas Hansen, Hansen Auction Service LLC, Plainview, NE; Gary Juranek,

Gary Juranek & Associates Auctioneers, Council Bluffs, IA; Mark Kliewer, Kliewer Auction

Service, Kearney, NE; Brent McCall, McCall Auctions & Real Estate, Onawa, IA; Duane

McClain, Auction Services Unlimited LLC, North Platte, NE; Johnny Walker, Nebraska

Auction Service, Trenton, NE.

The Bid Calling champion won a trophy-belt buckle, plaque, and entry fee to the 2011

International Auctioneers Championship at the National Auctioneer Association Convention to

be held in Orlando, FL. Rural Radio Network - KRVN, KTIC, and KNEB, sponsored the


championship trophy. The winners’ plaques and the top finalist prizes were sponsored by

Midwest Messenger of Tekamah, NE.

The Nebraska Auctioneers Association promotes the auction method of marketing by providing

professional training and support for auctioneers in Nebraska. Bruce McDowell of McDowell

Auction Service in Trumbull, NE is the President of the Association, which is headquartered in

Lincoln, Nebraska.

Assiter Auctioneers Training Course

The Assiter Auctioneers Training Course offers one on one coaching from two of the most

talented auctioneers in the world! Spanky and Amy Assiter own a national, independent auction

company, as well as being independent contractors for some of the largest auction companies in

the world. They will share their vast knowledge of bid-calling expertise with you and help you

develop a chant and on-the-block sales techniques that are custom fit for your goals in the

auction business. If you are a beginning auctioneer or a seasoned veteran, Spanky and Amy can

help you advance your bid calling skills, in turn, advancing your career.

“The greatest thing I did for myself as a

young auctioneer was to seek bid-calling

training from a past world champion livestock

auctioneer! The money that I spent on that

training paid off immediately and came back

to me in dividends. You can’t afford NOT to

take advantage of bettering yourself! It’s never too late or too soon.”


Amy Assiter

“While I believe that an auctioneer’s great sounding chant doesn’t make him or her the best auctioneer,

I do believe that a great chant lends credibility to that auctioneer’s first impression…and we all know

that the first impression is the most important one. It gets your foot in the door, so you can show them

what you can really do!”

Tom “Spanky Assiter”

Other Polished Bid Calling Auctioneers

Jim Pennington

Jim Pennington of Bakersfield, California is Auction raised. The son and grandson of auctioneers, he

sold his first equipment auction at age 16 and was the 2000 International Livestock Auctioneering

Champion in Calgary, Canada. Jim is a past president of the California State Auctioneers Association,

and a life member of the National Auctioneers Association. He has been featured as a speaker at the

National Auctioneers Convention on the topic of bid calling.

During his auction career of 25 years, Jim was the owner and auctioneer at Western Stockman's Market

Inc., one of the largest livestock auctions in the country. During his auctioneering career, he sold over a

billion dollars worth of assets. Jim was also the founder of Pacific Auction Exchange, Inc. Real Estate

Auction Company. He has a passion for teaching up-and-coming auctioneers through the WCCA

auctioneer courses.

Jim has produced a nation-wide infomercial about auctioneering as a career titled "Get Rich, Go

Auction." He has also authored a how-to book, DVD and CD about auctioneering, auctioneer courses,

and the opportunities in the auction industry.


Jim's desire to be the best inspired the formation of the World Champion College of Auctioneering by

bringing together the best auctioneers in the world to afford their students the opportunity to pursue

their goals of becoming the best as well.

Max Olvera

Max started out pursuing his auctioneer dreams at a young age. At eleven years old, Max was featured

on the national television show, Real People, as the nation’s youngest auctioneer. Since then, Max has

gone on to be a World Champion Auctioneer, winning the title in 2000.

For eighteen years, Max was the auctioneer and the manager of the Cattlemen’s Livestock Market in

Galt, California, one of the nation’s premier livestock auction markets. He is currently the lead

auctioneer and co-owner of the Turlock Livestock Auction Market, holding three sales per week.

Max is passionate about auctions and auctioneering. Each year he looks forward to teaching the WCCA

auctioneer course, giving his experience and expertise to the students.

Ralph Wade

Regarded by his peers as one of the best bid callers of all time, Ralph has dedicated time to teach others

the art of bid calling, expanding his talent by producing three instructional videos including

“Auctioneering My Way”.

Ralph was the 1974 World Champion Livestock Auctioneer and also the 1995 International Champion

Livestock Auctioneer. He is currently lead auctioneer for

Superior Livestock Auction, the nation’s largest live satellite

cattle auction, selling nearly 2 million head of cattle per year.


Ralph currently resides on the Gross Gavel Ranch just outside of Oklahoma City, raising and training

champion cutting horses.

Auction

An auction is a process of buying and selling goods or services by offering them up for bid, taking bids,

and then selling the item to the highest bidder. In economic theory, an auction may refer to any

mechanism or set of trading rules for exchange. There are several variations on the basic auction form,

including time limits, minimum or maximum limits on bid prices, and special rules for determining the

winning bidder(s) and sale price(s). Participants in an auction may or may not know the identities or

actions of other participants. Depending on the auction, bidders may participate in person or remotely

through a variety of means, including telephone and the internet. The seller usually pays a commission

to the auctioneer or auction company based on a percentage of the final sale price.

Call Auction

In a call auction participants indicate their willingness to buy or sell units of a security by placing an

order to buy or sell some number of units at their buying or selling price. At some point in time the

orders collected so far are matched together to form contracts. Different auctions follow different rules

about the acceptance of orders, feedback about orders in the system, rules for updating or withdrawing

orders, when to do the match, how to do the match, and the form and content of the resulting contracts.

Auctions can also become more complex in the definition of a unit to include variable attributes and

bundling options.

History of the Auction

The word "auction" is derived from the Latin auge, which means, "I increase" or "I augment". For most

of history, auctions have been a relatively uncommon way to negotiate the exchange of goods and

commodities. In practice, both haggling and sale by set-price have been significantly more common.

Indeed, prior to the seventeenth century the few auctions that were held were sporadic and infrequent.


Nonetheless, auctions have a long history, having been recorded as early as 500 B.C.

Oldest Auction House

The oldest auction house in the world is Stockholm Auction House (Stockholms Auktionsverk). It was

established in Sweden in 1674. During the end of the 18th century, soon after the French Revolution,

auctions came to be held in taverns and coffeehouses to sell art. Such auctions were held daily, and

catalogs were printed to announce available items. Such Auction catalogs are frequently printed and

distributed before auctions of rare or collectible items. In some cases these catalogs were elaborate

works of art themselves, containing considerable detail about the items being auctioned.

Sotheby's, now the world's second largest auction house, held its first auction in 1744. Christie's, now

the world's largest auction house, was established around 1766. Other early auction houses that are still

in operation include Dorotheum (1707), Bonhams (1793), Phillips de Pury & Company (1796),

Freeman's (1805) and Lyon & Turnbull (1826). During the American civil war the Colonel of the

division sold goods seized by armies at auction. Thus, some of today's auctioneers in the U.S. carry the

unofficial title of "colonel". The development of the internet, however, has led to a significant rise in

the use of auctions as auctioneers can solicit bids via the internet from a wide range of buyers in a

much wider range of commodities than was previously practical.

Construction Bidding


Construction bidding is the process of submitting a

proposal tender to undertake, or manage the undertaking

of a construction project.

The tender is treated as an offer to do the work for a

certain amount of money (firm price), or a certain

amount of profit (cost reimbursement or cost plus). The

tender which is submitted by the competing firms is

generally based on a bill of quantities, a bill of approximate quantities or other specifications which

enable the tenders attain higher levels of accuracy, the statement of work.

For instance, a bill of quantities is a list of all the materials (and other work such as amount of

excavation) of a project which have sufficient detail to obtain a realistic cost, or rate per described item

of work material. The tenders should not only show the unit cost per material/work, but should also if

possible, break it down to labour, plant and material costs. In this way the individual who is selecting

the tender will be quite confident that the tender is feasible. Bids are not only chosen on cost alone.

Sometimes contractors submit lower tenders to win the contract and win the work. Either the costs that

the contractor incurs is greater than the price he is charging the client (as a consequence of a lower

tender determining the contract sum), and thus is likely to go insolvent, or he will claim for "loss and/or

expense" due to discrepancies in the contract documents (this can be done deliberately). The lowest

tender is not always a feasible tender. The lowest tender is the most likely to increase the contract sum,

the most throughout the course of the project.

Bid Solicitation

Bid solicitation is the process of making published construction data readily available to interested

parties, including construction managers, contractors, and the public. There are several services,


including government entities and private data services, that allow project owners to release project

details to solicit and obtain contractor bids. These services act as a gateway for project owners to

release project information to a large group of contractors, general contractors or subcontractors in an

attempt to solicit bids. Many of these services are subscription based or charge a flat rate for project

data.

Types of Project Delivery

The most common methods of construction project delivery include design-bid-build (DBB), the

design-build (DB), the construction manager as constructor approach and a negotiated approach. Each

of these methods have advantages and disadvantages and all can be used to successfully plan, design

and undertake a given construction project.

Traditional Procurement

The traditionl procurement method is the most common construction delivery method. This process

begins with an owner selecting an architect to prepare construction documents. These are prepared

using drafting standards such as the Institute of Civil Engineers ICE Conditions of Contract, or the

NEC Engineering and Construction Contract. In most cases, the architect will release these

construction documents publicly, or to a select group of general contractors, who will then place a bid

on the project which reflects what they believe cost of construction will total. This bid is inclusive of a

multitude of subcontractor bids for each specific trade. The general contractor’s fee is generally built

into the bid cost. Most government contracts are bid competitively using this method.

Digital Procurement


The digital procurement method is the emerging method. There are various sited such as Tender

Chamber, Callbids.com and so on that provide Free service for tender calls. The casual and home

owners projects usually announce free while the formal tenders

need to be secured by deposits.

Design-Build

Design-Build (or design/build, and abbreviated D-B or D/B

accordingly) is a construction project delivery system where, in

contrast to traditional "design-bid-build" (or "design-tender"), the design and construction aspects are

contracted for with a single entity known as the design-builder or design-build contractor. The design-

builder is usually the general contractor, but in many cases it is also the design professional (architect

or engineer). This system is used to minimize the project risk for an owner and to reduce the delivery

schedule by overlapping the design phase and construction phase of a project. Where the design-builder

is the contractor, the design professionals are typically retained directly by the contractor.

History

The design build delivery system often cites the original "Master Builder" model used to build most

pre-modern projects. Under the Master Builder approach, a central figure of the architect held total

project accountability. From inception to completion, the master builder was the key organizational

figure and strictly liable to the owner for defects, delays, and losses. The design/build system is a return

to some of the fundamentals of the Master Builder approach.

Bid Jargon

Auctioneer

One that conducts an auction.

Bid


To issue a demand, to direct, to utter, to invite, to attend, or to summons an event or auction; to make

an offer to pay a specific price for goods and or services.

Bidding

A request to appear considered as a group, as at an auction.

Procurement

To get by special effort; to obtain or acquire.

Tender

Tender is a formal offer of money or service in payment of an obligation. A written offer to contract

goods or services at a specified cost rate or bid and to offer money as formal exchange.

bid calling - all star training · made, the contracting officer can request from the bidder a...

Documents