For all its positives, properly tendering a project requires a major investment of time on the part of commercial real estate owners and their teams. Even simple tender processes require hours of preparation on the part of the project manager, and then typically require several days for the vendors to prepare their tenders, followed by leveling, negotiation, and, finally, award.
When speed of completion is critical to a job, spending too much time on the tendering process can bog down managers’ schedules, reducing the attractiveness of the financial returns for the project. That’s why it’s important to set timing guidelines with your team and your vendors.
So, how long should the tender process take for commercial real estate projects? Our data, based on the last 1,500 RFPs that have been run through the Procore system, provides some key insights.
Evaluating Timing in Stages
In order to analyze how long owners typically give vendors throughout the tendering process, we looked at our procurement data at three different stages:
Invite to first tender: This number represents the length of time owners are giving their vendors to submit a first round of tenders. It measures the amount of time it takes from when the first tenderer gets invited into Procore for an RFP response to the time the first tender is received back through the platform.
First tender to last tender: This is typically the period where tenders are revised to reflect any clarifying questions, or the length of time from initial tender submission to the conclusion of the best and final offer. It is the length of time between the owner’s receipt of the first tender to the receipt of the last tender, including revisions.
Last tender to award: This is the time frame between final tender submissions and tender award. Based on our experience with our partners and clients, this likely reflects the time for any final negotiations and clarifications, including the internal approval and sign off process to award tenders.
Best Practices to Apply with Your Teams
According to our data:
- Invite to first tender: The median number of days it takes from inviting tenderers to answer an RFP to receiving the first tender is 7.8 days.
- First tender to last tender: The median number of days from first tender to last tender received by an owner is 4 days.
- Last tender to award: Owners takes an average of 8 days to award the tender.
It’s important to keep in mind that these numbers can vary widely by project size and complexity. In fact, as the chart below shows, it varies quite a bit.
For smaller, less complex projects valued at under $100k, the median timing is only about five days from tender invite to first tender, three days for all tenders to be received and 6.7 days between last tender received and award. But for larger jobs, including those over $1M, the median days out to tender is 16 days, or just over two weeks.
Based on this information, best practices show that it takes about two and a half weeks for a tendering process from the day you send the RFP to awarding a tender.
Most Popular tender Due Date
We often joke in customer training that Friday at 5pm is the most common tender due date. After all, what project manager wouldn’t want to kick up their feet at the end of a long week and relax by leveling tenders?
We may get a good laugh at this, but what do the numbers say? Based on our data, it turns out our intuition was right. Friday is the most popular day tenders are requested to be returned from vendors, with almost twice as many tenders due on Friday than any other day of the week. Whether the project managers are actually leveling the tenders over the weekend is questionable. Another idea is that managers expect vendors to be late in submitting their information, and proactively give them the extra days over the weekend to submit.
A properly run tender process is key to the relationships between the owner’s team and vendors. A clear understanding of timing expectations starts that relationship off on the right foot.
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