What is a tender?

In procurement, a tender takes shape when a buyer opens a competition under set rules, and each supplier taking part replies with a complete, priced offer on the buyer's documents. The supplier answers the buyer's questions, prices the work in the buyer's schedule and signs the declarations the buyer requires, and the buyer evaluates every tender it receives against the same published criteria. This is the procurement sense of the word, the one used in tender documents, in public procurement law and by bid teams.

The meaning stops at the offer and the competition it sits in. The stages a buyer runs, the procedure it chooses and the work of writing a winning response are separate subjects with their own names: the tender process, procedure types, and bid or tender management.

Two meanings of tender in procurement

In business and procurement, a tender means two things: the competition a buyer runs and the offer a supplier submits. The surrounding words show which one is meant.

The competition a buyer runs

A buyer that puts a contract out to tender publishes what it needs, sets a deadline and the competition rules, and invites suppliers to make offers. "Out to tender", "a live tender" and "the tender closes on Friday" all use the word for the competition.

Followed across its stages, from the published notice to the award and, in public contracts, the standstill period, the competition is the tender process. The buyer runs it, and bid teams follow it from the supplier's side.

The offer a supplier submits

In the second sense, a tender is what the supplier sends back: its complete, priced offer, made on the buyer's documents and by the buyer's deadline. Tender documents and procurement law use the word this way, and call the supplier that submits one the tenderer.

This is the side the bid profession works on. BSI's PAS 360:2023, the UK code of practice for bid and proposal management, covers how suppliers prepare their responses, and states that it is not guidance on the procurement activities a buyer carries out.

Telling the two apart

The verb usually settles it. A tender that is issued, published or run is the competition; a tender that is written, priced, signed, submitted or withdrawn is the offer.

So "the tender asks for three case studies" refers to the buyer's competition and its documents, while "the tender came second on price" refers to one supplier's offer. Tender as an adjective, legal tender as currency and a tender offer for shares share the spelling and nothing else.

What a tender is made of

A tender includes the supplier's answers to the buyer's questions, its price in the buyer's schedule, the forms and declarations the buyer requires, and the attachments it asks for, all arranged in the structure the buyer sets. That is what tenders are in practice: the buyer's structure, completed by the supplier.

Answers and price

The answers respond to the buyer's questions one by one: scored questions within their word or page limits, and pass/fail questions in the form the buyer gives. Each answer sits where the buyer placed the question, because evaluators mark against their own question list.

The price goes into the buyer's pricing schedule, in the units, lots and currency it sets. A supplier's own rate card is no substitute for that schedule.

Forms and declarations

Alongside the answers sit the forms the buyer requires, such as a form of tender, declarations on the grounds for exclusion, and statements on subcontracting or joint bidding.

Attachments in the buyer's format

Attachments are the documents the buyer lists as required, such as certificates, insurance evidence, accounts, CVs, case studies or method statements, each named and supplied as instructed.

The buyer sets the format of all of it. One European Investment Bank tender dossier required a technical offer and a financial offer in separate PDF files, each on the bank's own templates. A tender is built to that structure, not to the supplier's house style or its usual proposal layout.

What submitting a tender commits the supplier to

Submitting a tender commits the supplier to the terms set in the buyer's tender documents. In the buyer documents below, those terms include a validity period for the offer, no changes after the deadline, acceptance of the buyer's terms over the supplier's own and, on award, an obligation to deliver what was offered.

The validity period

The validity period is the time during which the supplier must stand by its tender. In one European Commission invitation to tender, the buyer states the period in the contract notice and describes it as the time in which tenderers may not modify the terms of their tenders in any respect.

The length differs by buyer. The European Investment Bank dossier bound tenderers for 180 days after the submission deadline, and the bank could ask them to extend it.

No changes after the deadline

In the EIB dossier, the deadline was the cut-off. Before it, the dossier allowed the tender to be amended or withdrawn; after it, no amendments were allowed.

The buyer's terms over the supplier's own

In the same Commission invitation, submitting a tender implies acceptance of all the terms and conditions in the procurement documents and, where appropriate, waiver of the tenderer's own terms.

The same document states that the submitted tender is binding on the tenderer awarded the contract. Award turns the offer into an obligation.

A tender guarantee where one is asked

Some buyers ask for a tender guarantee alongside the tender. In another European Commission tender dossier, tenders can be accompanied by tender guarantees, and a guarantee must cover any extension of the validity period.

In that dossier, a tenderer who refuses a request to extend validity keeps its guarantee, but its participation in the procedure ends.

Public and private tenders

A public tender is run by a public buyer under procurement law. A company runs a private tender under its own purchasing rules, and its terms come from that company's documents.

Public tenders under procurement law

Directive 2014/24/EU in EU member states and the Procurement Act 2023 in England, Wales and Northern Ireland set the rules for public tenders.

Within those rules, the buyer chooses a procedure.

Private tenders under a company's own rules

A private company buying for itself is not a public buyer, and its tender terms are set by the invitation it issues.

How a tender differs from a bid, a quotation, an RFP and an ITT

A tender and a bid overlap almost entirely. A quotation is a price-led offer, an RFP is the buyer's request, and an ITT or RFT is the invitation a tender answers.

Tender and bid

On the supplier's side, a bid and a tender are close to the same thing, and the job titles show it. BSI lists tender managers and tender writers alongside bid managers and proposal managers as the readers of PAS 360.

Where the two words differ, bid is the broader term. It covers any competitive offer and the whole effort behind it, including commercial deals with no formal competition. Tender points to a formal competition run under published rules.

Tender and quotation

A quotation states a price for defined goods or services, usually in answer to a request for quotation (RFQ), with little written response beyond the price and its terms. In a tender, price is one part of a fuller offer, judged alongside answers, declarations and attachments against published criteria.

The line blurs when a buyer runs an RFQ with fixed rules and a deadline. What decides it is whether the supplier is making a full offer under published criteria or pricing a specified item.

Tender and RFP

An RFP, or request for proposal, is the buyer's document, and the supplier's reply is a proposal.

The RFP and the tender sit on opposite sides: one asks, the other answers. Where an RFP sets a formal competition with a deadline and binding terms, the proposal a supplier sends works as a tender in all but name.

Tender and the ITT or RFT

An invitation to tender (ITT), or request for tender (RFT), is the buyer's set of documents inviting tenders. It states the questions, the format, the deadline, the award criteria and the terms a tender accepts. The tender is the supplier's response.

In UK public procurement, the ITT is often the scored stage after a selection questionnaire, where the full tender is written. The invitation sets the rules, and the tender is what is judged against them.