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Run the tender process

Several rules and directions govern how you must run a tender.

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You should always give suppliers enough time to prepare proper responses to a tender.
The minimum period for a tender will depend largely on whether or not you’re engaging in a covered procurement, as well as how you're approaching the market.
You should try to get enough quotes or tender responses to ensure competitive tension.
Generally, the supplier must bear their own costs of responding to an approach to market.
If an expert adviser helps you prepare tender documents, you must exclude them from tendering for the work.
Review the 'sourcing online' learning module and learn how to run the tender process.

Give suppliers reasonable time to respond

You should always make sure the tender period gives prospective suppliers reasonable time to effectively prepare their submissions or bids and price the work.

After all, the more prepared they are, the more likely you’ll find the right supplier and achieve a successful procurement outcome.

Wherever possible, you should allow potential suppliers to respond to the tender electronically.

Beyond this, different rules apply to how long you must keep a tender open. These depend on the value, complexity and urgency of the work, as well as how you publish the tender.

Tender periods for covered procurements

If your procurement is for:

goods and services valued over $680,000 (excluding GST)
a construction contract valued over $9,584,000 (excluding GST)

it may be covered by Australia’s international trade agreements and subject to the requirements in board direction, PBD-2019-05 Enforceable Procurement Provisions.

Read more about Enforceable Procurement Provisions.

The following minimum tender periods apply for covered procurements. However, you must make sure you give suppliers enough time to prepare and lodge their submissions, taking into account your reasonable needs.

No set period:

Where you have a genuine and urgent need for the procurement. Examples include responding to a critical issue or an emergency.

10 calendar days:

Where you’re procuring commercial goods or services non-government businesses can routinely buy.
Where you’ve approached the market within the last 12 months for substantially similar goods or services and stated at the time you’d make another approach.
Where you’ve included a notice of the procurement in an annual procurement plan and published it on buy NSW Tenders at least 40 days and not more than 12 months before you publish the tender.

25 calendar days:

All other tenders.

The Department of Customer Services launched Tenders on July 1 2024 to create a more secure and integrated market opportunity process.

Suppliers will have a more streamlined experience, making it easier for them to do business with NSW Government.

Tender periods for non-covered procurements

You can decide on the most suitable tender period, taking into account your reasonable needs and the suppliers’ ability to prepare and price their submissions. However, we recommend the following minimum tender periods for non-covered procurements.

No set period:

Where you have a genuine and urgent need for the procurement. Examples include responding to a critical issue or an emergency.

10 calendar days:

Where you include the tender on buy NSW Tenders as part of your annual procurement plan.
Where you’re buying the goods or services through a panel contract, standing offer or NSW Government prequalification scheme.
Where you’re approaching the market as part of your recurring procurement arrangements.

25 calendar days:

In any situation where you publish the tender on buy NSW Tenders.

30 calendar days:

In any situation where you don’t publish the tender on buy NSW Tenders.

Number of quotes or tenders

You must always look to achieve value for money, especially in high value and prescriptive contracts. One way you can do this is to make sure you receive enough quotes or tenders to create competitive tension.

You should also attempt to make sure you encourage small to medium enterprises (SMEs) to participate. Where appropriate, this should mean inviting at least one SME to tender or quote.

When you’re sourcing from a scheme, you should follow the scheme guidelines for buyers.

You are also allowed to procure using a lower number of quotes for some types of procurements. These include some low-value contracts, contracts with small businesses and procurements involving an Aboriginal-owned enterprise.

Assistance with costs

Generally, the supplier must bear their own costs of responding to an approach to market.

In special circumstances, you may offer assistance with the cost of tendering. If you do, you must include details in the approach to market documents.

Special circumstances should be limited to high-cost procurements and extenuating circumstances. Your agency head must approve any reimbursement before you can pay a supplier.

Considerations when tendering for construction procurements over $100 million

Tender periods

When you're procuring construction or infrastructure contracts worth more than $100 million, you should consider Infrastructure Australia's time benchmarks for the procurement process. This is especially important where the procurement involves a design and construct, public/private partnership (PPP) or alliance-type delivery model.

For complex projects under $100 million, such as construction work with significant design elements, a longer tender period may also be needed.

Your procurement may also be covered by Australia's international trade agreements and subject to board direction, PBD-2019-05 Enforceable Procurement Provisions.

Tender responses and evaluations

For projects valued above $100 million you should consider requiring tenderers to demonstrate their capacity for successful collaboration with the NSW Government. Ask them to provide at least two referees who can verify their ability to collaborate with NSW government, their past performance, any legal and contract disputes, and their commitment to resolving commercial issues, ensuring successful outcomes.

If a tenderer has no prior experience with the NSW Government experience you should consider requesting two referees from contracts within the last 5 years. Ideally, these referees should be CEOs or directors, who can comment on the tenderer's legal and contract disputes history and their ability to resolve commercial issues.

Also, consider any existing performance data the agency has on the tenderer's work with the government.

NSW Bid Cost Contributions Policy

The NSW Government will consider contributing up to 50% of an unsuccessful bidder's estimated costs, where:

you can demonstrate a bid cost contribution provides value for money
the bidder submitted an appropriate bid but wasn't awarded the contract, and
the bidder agrees the NSW Government owns any intellectual property contained in the bid, where reasonable.

We make contributions based on your assessment of the bidder's costs, not theirs. We won't consider contributions for projects with an estimated total capital cost of $100 million or less.

If you're considering bid cost contributions as part of a tender, you should always first seek NSW Treasury's consent before you release any expression of interest (EOI). NSW Treasury will provide this, so long as you meet the conditions of the Bid Costs Contributions Policy.

You should also include the proposed contribution in the total project funding envelope that you present to the ERC or Cabinet for approval before you begin the procurement process.

Using external advisers

Where you engage an expert adviser to help prepare request for tender (RFT) documents, you must exclude them from also tendering for the work.