No to public tenders? An examination of the reason why tenders choose not to participate in publicly-commissioned construction projects
Student thesis: Master Thesis and HD Thesis
- Christoffer Nielsen
- Christian Christiansen
4. term, Management in the Building Industry (cand.tech.), Master (Master Programme)
This master thesis is produced by students enroled at Aalborg University, Department of Civil Engineering, specialized in Construction Management in the Building Industry, in the period September 2017 - January 2018.
"What is the motivation to bid on a public project if the right price, the right time and the good quality aren't appreciated and we can't be considered another time?"}
(quote from one of the interviews in the thesis from an employee from the building industry)
This master thesis examines the conditions for publicly-commissioned construction projects, as well as the reasons that tenderers choose not to participate in these projects. The thesis is limited to focus on projects offered in accordance with the Danish Public Tenders Act. It is relevant to address this issue as there is a political desire to increase the competition on public projects in order to achieve an ideal relationship between the quality of delivery and the price of services. This wish seems to be in contrast to the fact that a significant proportion of the industry's companies apparently choose to not participate in these projects, thereby weakening the competition. This has awaken a curiosity to investigate the reasons why public assignments are deselected and the thesis is based on the following research question: Why do private tenderers deselect public projects under the Public Tenders Act? The thesis is defined only to include projects under the Public Tenders Act, as these projects has the largest interface in the industry's business segments. Using a method triangulation of qualitative and quantitative research methods, the thesis starts with a qualitative analysis of a range of tenders, in order to identify the possible reasons for the deselection. This is supplemented by interviews of three stakeholders from the industry and the results are subsequently validated through a quantitative questionnaire survey to assess whether the results can be generalized to the whole building and construction industry. The thesis addresses all parties in the industry and is based on the assumption that the reader has a basic knowledge of the industry's processes and possible challenges. As the thesis is based on the tenderers' viewpoint on the issue, the thesis is regarded as particularly relevant for contracting entities in order to understand what changes that could lead to more tenderers bidding on the projects.
"What is the motivation to bid on a public project if the right price, the right time and the good quality aren't appreciated and we can't be considered another time?"}
(quote from one of the interviews in the thesis from an employee from the building industry)
This master thesis examines the conditions for publicly-commissioned construction projects, as well as the reasons that tenderers choose not to participate in these projects. The thesis is limited to focus on projects offered in accordance with the Danish Public Tenders Act. It is relevant to address this issue as there is a political desire to increase the competition on public projects in order to achieve an ideal relationship between the quality of delivery and the price of services. This wish seems to be in contrast to the fact that a significant proportion of the industry's companies apparently choose to not participate in these projects, thereby weakening the competition. This has awaken a curiosity to investigate the reasons why public assignments are deselected and the thesis is based on the following research question: Why do private tenderers deselect public projects under the Public Tenders Act? The thesis is defined only to include projects under the Public Tenders Act, as these projects has the largest interface in the industry's business segments. Using a method triangulation of qualitative and quantitative research methods, the thesis starts with a qualitative analysis of a range of tenders, in order to identify the possible reasons for the deselection. This is supplemented by interviews of three stakeholders from the industry and the results are subsequently validated through a quantitative questionnaire survey to assess whether the results can be generalized to the whole building and construction industry. The thesis addresses all parties in the industry and is based on the assumption that the reader has a basic knowledge of the industry's processes and possible challenges. As the thesis is based on the tenderers' viewpoint on the issue, the thesis is regarded as particularly relevant for contracting entities in order to understand what changes that could lead to more tenderers bidding on the projects.
Language | Danish |
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Publication date | 10 Jan 2018 |
Number of pages | 75 |