The below is a review of a few tenders on GeBiz (Singapore government tendering platform) for arborist services. For the first two tenders the quotes were competitive, as they were quite close to one another. As for the rest of the tenders, the lowest bidders were just undercutting everyone else. Could they even cover their overheads with that kind of asking price?
In all cases, the lowest bidders won the tender. Currency in Singapore dollars.
Quotation No.: DEFEPS3000024993 (Ministry of Defense)
Company A - $24,000
Company B - $15,360
Lowest bid is 36% lesser than second lower bid
Quotation No.: HDB000ETQ16000520 (Housing and Development Board)
Company A - $3500
Company B - $2696
Lowest bid is 23% lesser than second lower bid
Quotation No.: JTC000ETQ16000105 (JTC Corporation)
Company A - $60,000
Company B - $12,000
Company C - $29,500
Company D - $2998
Lowest bid is 75% lesser than second lower bid
Quotation No.: HDB000ETQ16000490 (Housing and Development Board)
Company A - $15,050
Company B - $13,300
Company C - $4,650
Company D - $10,000
Lowest bid is 53% lesser than second lower bid
Quotation No.: JTC000ETQ16000100 (JTC Corporation)
Company A - $2000
Company B - $1800
Company C - $1100
Company D - $2936
Company E - $700
Company F - $13 (8+5)
Lowest bid is 98% lesser than second lower bid
There may have been a misunderstanding of the quantity that was being bidded for by Company F. There were two items to bid for and combined to give the final bidding price. Item 1 is to assess the first 10 trees, and item 2 is to assess the next trees in blocks of 10. For example, the contract owner could choose to have the first 10 trees assessed based on item 1's price, and the next 30 trees assessed based on item 2's price times 3 (30 divided by 10 is 3).
Company F may have misunderstood that the bidding was based on the assessment of one tree.
If the latter was true, then his bid should be $130, and hence the lowest bid was 81% lesser than second lower bid.
Will this model of competitive bidding be sustainable when competitors are bidding on average >50% lesser than the next company?
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