Tender words in plain English: RFQ, RFP, ITT and more
What RFQ, RFP, ITT, standing offer, addendum, bid bond, holdback and other public tender terms mean, in plain language for BC trades.
Short answer
An RFQ asks for prices and usually goes to the lowest compliant quote. An RFP asks for a proposal scored on several criteria, including price. An ITT is a formal tender won on price. A standing offer or supply arrangement is a pre-approved list you join once and are called from later. An addendum changes the tender before it closes.
Public tenders have their own vocabulary, and the same thing can go by different names on different portals. These are the terms you'll see most on BC service contracts, each in a sentence or two.
Types of calls
RFQ: request for quotation
The buyer asks for prices on a clearly defined job. The lowest quote that meets every requirement usually wins. Common for smaller and simpler work.
RFP: request for proposals
The buyer describes what it needs and asks how you would do it. Proposals are scored against published criteria such as experience, approach, staff, safety and price, and the highest score wins. Used when the buyer cares about more than price.
ITT or ITB: invitation to tender or invitation to bid
A formal call with a fixed scope, usually won by the lowest compliant bid. Common in construction. Bids are often binding once they're submitted and can't be withdrawn for a set period.
RFSQ or RFQual: request for supplier qualifications
A first stage that picks who is allowed to bid later. You send your experience and credentials, not a price. Only qualified suppliers are invited to the second stage.
RFI or RFEI: request for information or expressions of interest
The buyer is asking what's out there, not buying yet. Responding is optional, but it puts you on the buyer's radar and sometimes shapes the eventual tender.
ACAN or NOIA: advance contract award notice, notice of intent to award
The buyer plans to give the work to one supplier without competition and is announcing it first. If you can do the work, you can usually respond before a deadline with a statement showing you're capable, and the buyer may have to compete it instead.
Lists you join once
Standing offer
An offer you make once, with set prices or rates, that the buyer can call on whenever it needs the work over a period. It's not a contract until the buyer places a call-up. The federal government uses standing offers a lot.
Supply arrangement
Similar to a standing offer, but prices are set later when the buyer runs a mini-competition among the suppliers on the list.
Qualified supplier list or prequalified list
A buyer's list of firms it will invite to quote for smaller jobs. Worth getting on with the municipalities and school districts near you, because much small work is never posted publicly.
In the tender documents
Addendum
An official change or answer to questions issued before closing. Addenda can change the scope, the forms or the closing date, and you usually have to list or sign every one in your bid.
Closing date and time
The exact moment bids must be in, almost always enforced to the minute. Check the time zone and whether submission is on a portal, by email or in person.
Mandatory requirement
Anything the bid must include or meet, often marked "must" or "shall". Missing one usually means the bid isn't evaluated.
Mandatory site meeting
A site visit you must attend to be allowed to bid. The tender lists the date, time and place.
Evaluation criteria
How bids will be scored and what each part is worth. Read this section first in an RFP.
Irrevocability period
How long your bid must stay open and unchanged after closing. The tender sets it, and it's often a couple of months.
Term and extension options
How long the contract runs, plus any extra periods the buyer can choose to add, such as "three years plus two one-year options".
Money and risk
Bid bond or bid security
A guarantee from a surety company that you'll sign the contract if you win. Often 10 percent of the bid price.
Performance bond
A surety's guarantee that the work will be finished if you can't. Often 50 percent of the contract value.
Labour and material payment bond
A guarantee that your workers and suppliers get paid.
Holdback
Money the buyer keeps back from each payment until the work is done and lien periods have passed. Under BC's Builders Lien Act the holdback is 10 percent, kept until 55 days after the work is certified complete or finished.
Unit rates and lump sum
Unit rates price each piece of work (per hour, per visit, per square metre). A lump sum is one price for the whole scope.
Safety and compliance
WorkSafeBC clearance letter
A letter showing a firm is registered with WorkSafeBC and in good standing. Buyers ask for one because they can otherwise be liable for a contractor's unpaid premiums. See the paperwork buyers ask for.
Prime contractor
The party responsible for coordinating health and safety on a work site, including subcontractors. Many BC tenders name the successful contractor as prime contractor.
COR: Certificate of Recognition
WorkSafeBC's certification for employers with an audited health and safety program. Voluntary, but it earns points on some bids and an annual WorkSafeBC incentive.
Still stuck on a word?
Ask the buyer. Every tender names a contact for questions and a deadline to ask them. Questions and answers usually go out to everyone as an addendum, so you're not giving anything away. For the bigger picture, read how to win government contracts in BC.
Sources
Rules and forms change. Check the official page before you rely on a detail here.