type of contracts and tendering procedure

8/13/2019 Type of Contracts and Tendering Procedure

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Neeraj LalVice President

Shalby Hospitals

TYPES OF CONTRACTSTENDERING PROCEDURE


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Types of Contracts:Choosing type appropriate contract type

is essential to successful performanceunder a contract.

The type of contract determines the cost

and performance risks which are placedon the contractor.

There are two broad contract groups--

fixed price and cost reimbursement.

Within each of these groups, there are

various types of contracts which can be

used individually or in combination.


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Firm Fixed Price Contracts

This type of contract requires thecontractor to successfully performthe contract and deliver conformingsupplies or services for a priceagreed to up front.

This type of contract places themost performance and cost riskpaid.


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cont...It if costs them more than they expected,they still get the amount originally agreeupon. If it costs them less, they make

more profit.

A firm-fixed price contract is suitable forsupplies and services that can be

described in sufficient detail to ensure

complete understanding of therequirements by both parties andassessment of the inherent risks of

performance.


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Other Fixed Fixed Price Contracts Within the fixed price contract group you

can award contracts with:

economic price adjustment factors toallow for industries where costs fluctuate

frequently either up or down various incentive types which can be

used to reward good performance or to

impose provisions to deduct for poorperformance


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Cont...various incentive types which can beused to reward good performance or toimpose provisions to deduct for poorperformance.

price redetermination provisions whichpermit issuing an order on a fixed pricebasis and allow for revisiting the

reasonableless of that pricing laterduring the contract performance.


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Cost Reimbursement Contracts A cost reimbursement contract allows for

payment of all incurred costs, within apredetermined ceiling, that can be

allocated to the contract, areallowablewithincost standards, and reasonable.

Therefore, all types of costreimbursement contracts place the leastcost and performance risk on thecontractor.


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cont.....

However, this type of contract is

required when the uncertainties of

performance will not permit afixed price to be estimated withsufficient accuracy to ensure a fair

and reasonable price is obtained.


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Within the cost reimbursement

category there are: Cost type - which involves payment of allincurred costs within a estimated cost.

Cost sharing - where the Governmentand the contractor agree to split the costof performance in a predeterminedmanner. No fee is given.

Cost-plus-fixed-fee - which allows forpayment of all incurred costs within apredetermined amount plus an agreed

upon fee which will not change.


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Cost-plus-incentive-fee - which provides

for adjustment of the fee (either up ordown) using a predetermined formulabased on the total allowable costs inrelation to total targeted costs.

Cost-plus-award-fee - which provides fornegotiation of a base fee with an awardfee which can be given based upon a

judgemental evaluation by theGovernment of contractor performanceand cost control.


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Tendering Procedure

1)Single tender

2)Limited tender3)Public / open tender

4)Global tender


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The set of tender form may consist of:

The scope of tenders The cost of tender documents

No. of copies to be submitted]

Time & date of submission & openingof tenders

Place of delivery

List of documents enclosed with

Security deposit condition

Terms & conditions of order


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Thank You

type of contracts and tendering procedure

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