Commercial Evaluation

This is the second stage after the technical evaluation. Commercial evaluation varies from one country to another due to special laws in government projects. In private-sector projects, the owner has the right to employ whatever evaluation system he feels best matches his requirement. In some countries, on government projects, a contractor-bidder can choose the system of evaluation. The system being followed should be stated on the tender package.

While cost always remains an important factor, other factors such as time and quality also need to be taken into account. Choosing the bidder who provides the lowest price may not be the best criterion if that price has emerged from a mistake in calculation or from the scope of what the contractor is proposing to cover not being made sufficiently clear. The impacts on the project will be felt in the time taken for completion or in the quality of the final result. Although the experience and capability of the contractor will be covered by the technical evaluation, that technical evaluation may have been accepted on the basis of the bidders proposals only just passing the 70-per cent threshold mentioned earlier.