Procurement & Tendering Glossary

Procurement Glossary

Understanding the language of procurement is essential for successful bidding. Here are the most common terms you'll encounter on the platform and in tender documents.

Tender

A formal invitation from a procuring entity for suppliers to submit offers (bids) to provide goods, services, or works.

Request for Proposal (RFP)

A procurement document that asks suppliers to propose solutions and pricing for a specific need. RFPs evaluate both technical capability and price.

Request for Quotation (RFQ)

A simpler procurement method focused primarily on price. Used for standard goods or services where specifications are clear.

Expression of Interest (EOI)

A preliminary stage where organizations express their interest in participating. Shortlisted firms are then invited to submit full proposals.

Procuring Entity

The organization issuing the tender ??? typically a government agency, municipality, international organization, or private company.

Bid Bond / Bid Security

A financial guarantee (usually 1???5% of bid value) required from bidders to ensure they don't withdraw their bid after submission.

Performance Bond

A guarantee provided by the winning bidder to ensure contract obligations are fulfilled. Typically 5???10% of the contract value.

CPV Code (Common Procurement Vocabulary)

A standardized classification system used to categorize procurement subjects. The system uses numerical codes (e.g., 45000000 for Construction).

Pre-Qualification

A screening process where the procuring entity evaluates potential suppliers' capabilities before inviting them to bid.

Technical Evaluation

Assessment of a bid's technical merit, including the proposed methodology, team qualifications, experience, and technical approach.

Financial Evaluation

Assessment of the price/cost component of a bid. May use lowest-price, quality-cost ratio, or value-for-money methods.

Best and Final Offer (BAFO)

A request from the procuring entity for shortlisted bidders to submit their final pricing. Used in negotiated procedures.

Contract Award

The formal decision to assign a procurement contract to a specific supplier. Award notices are typically published publicly.

Framework Agreement

A long-term arrangement (1???4 years) between a procuring entity and one or more suppliers. Individual orders are placed against the framework as needed.

Addendum

An official modification to a tender document after it has been published. Addenda may extend deadlines, clarify requirements, or change specifications.

Consortium / Joint Venture (JV)

An arrangement where two or more companies combine their capabilities to submit a joint bid.

Due Diligence

The process of verifying information about a tender or procuring entity before committing resources to bid preparation.

Debriefing

A post-award meeting where unsuccessful bidders receive feedback on their submissions. Important for improving future bids.

Single Source / Sole Source

A procurement method where only one supplier is invited to submit a proposal. Used when the required goods or services are only available from one source.

Open Tender

The most common method, where any qualified supplier can submit a bid. Maximum transparency and competition.

Restricted Tender

Only pre-qualified or invited suppliers may submit bids. Used for specialized or sensitive procurements.