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  Analytical Report on Tender Process Monitoring

Reviewing the conducted work it must be mentioned that in spite of difficulties arising in the process of preparation of tender documents and complications in obtaining of information about the conducted tenders, Slavutich companies successfully participate in implementation of the Projects, Chernobyl NPP Programmes and spent the biggest part of the Slavutich Town Executive Committee budget financing.


In order to conduct more detailed analysis on defining of dynamics of Slavutich companies’ participation in Tender procedures, activities were conducted in several directions:

1. The draft of the Contract about cooperation between SSE ChNPP and ME BDA. In the framework of this Contract it was planned to conduct joint work on providing with information relative to the Tenders conducted by SSE ChNPP;

2. The letter – inquiry for information about tenders conducted in 2004 and participating of Slavutich companies in procedures was prepared and sent to the address of the Tender Committees Chairmen;

3. By means of the developed questionnaire, Slavutich entrepreneurs were surveyed in order to study the most frequent comments and mistakes in Tender documents, participating of the companies in Tenders.

Analysing participating of Slavutich companies in spending of budget funds for implementation of the Projects and Chernobyl NPP Programmes and performance of the Plan of Slavutich development the following may be mentioned:

1. Chernobyl NPP Tender Committee conducted the biggest amount of Tenders during 2004 – 433. Slavutich companies – winners of the Tender processes in 2004 made 32%. Total sum of the Contracts signed with Slavutich companies was 31,000,000 hrvn.

2. Tender Committee of Slavutich Executive Committee conducted 36 Tenders and spent 434,099.80 hrvn of the budget funds. Two Tenders (catering of the children and purchasing of medicines) were conducted under the procedure "Open Tenders". In the second half of 2004 Slavutich companies sent 17 proposals to the Tender Committee. As the result of conducted Tenders 4 companies signed the contracts for the total sum of 94, 438.36 hrvn.

3. As before, the main procedure of the Tender processes is request for the Price Quotations. In order to participate in this procedure the company has to be known, i,e, has experience of participating in Tender procedures, corresponding qualification in conducting of the work or providing services, constantly increases its production potential and pay enough attention to advertising to be promoted in the market. In other words, companies have to be known, and in this case, they will be given preference as business partner.

Slavutich companies less participate in International Projects. More often their participation includes communication, lease and transport services.

10 Slavutich companies participate in the Project of PKTRO construction, one contract was signed on the "Shelter" Object Project, 7 Contracts were signed on the Project of LRTP construction in the second half of 2004. It was conditioned by the complexity of tasks, non-correspondence of the companies’ technical potential to the set conditions of fulfilling of the work. Among the most frequently occurred comments on the Tender proposals the following may be mentioned:

• Incomplete Tender Proposals;

• Term of Tender Proposals is less than the Customer has claimed;

• Non-correspondence of qualification data, formal approach while submitting of information about the candidate’s qualification.

• Insufficient detailed elaboration of the schedules of work performance.

• Absence of "Supplier’s Quality Programme"


Effectiveness of Slavutich companies participation in Tender processes looks as following

As you can see in diagramme in the second half of 2004 the largest amount of Tender Proposals (153) submitted to Chernobyl NPP Tender Committee by Slavutich companies.

For further successful participation of the companies in Tender processes the Managers of Tender Committees gave the following recommendations:

• Revise the price policy of the company;

• Study the issue of possible uniting of companies in order the increase production potential;

• Constantly improve qualification of working staff;

• Prepare Tender documents have to be prepared more attentively.

In order to increase production potential and to win in the Tender processes there were given examples of united companies.

Such examples are shown in the following diagramme:

publication

In this diagramme you can see that the companies do not work enough in this direction.

In order to study the opinion of Slavutich entrepreneurs on the given issue the questionnaire was developed including the questions which made possible to define the effectiveness of participation of the company in the Tender procedures. Slavutich entrepreneurs were suggested to answer the questions in written and oral forms.

As a result of the conducted survey among 64 companies and subjects of entrepreneurial activity the conclusion was made that the biggest amount of participants (29) submitted their Tender Proposals to Chernobyl NPP Tender Committee. 62 Tenders were won and 57 Contracts were signed after the participation. At the same time it is necessary to mention that there if rather high percentage of turning down of Tender Proposals of the companies because of formal signs (37). More often they are:

• Incorrect drawing up of the package of Tender Proposal (there is no candidate’s address, number of purchasing etc.)

• Delay in submitting of the Proposal according to the terms,

• Submitting of the Proposal only in one copy.

14 companies and subjects of entrepreneurial activity submitted their application for participation in the Tender Procedures of International Projects. The result of the participation is 20 victories and 18 signed Contracts. Private entrepreneurs proposing themselves as experts on different directions of activities and companies providing services dominate in this group. Three proposals were turned down because of formal signs.

13 participants submitted their proposals to the Tender Committee of Slavutich Executive Committee. There were 17 positive results. 11 Contracts were signed. 5 Tender Proposals were turned down on formal signs.

Eleven companies sent their Proposals to other regions and 27 Proposals were the best at the results of the conducted Tenders. The Contracts were signed on all these Proposals.

Slavutich entrepreneurs suppose that the most often reason of turning down of Tender Proposals is biased attitude from the side of Tender Committees. Incorrectly chosen price policy of the companies (overprice of Proposals by the subject of entrepreneurial activity and issues of advance on a contract while performing of more considerable work) is on the second place.

There are positive examples of uniting of companies in order to increase production potential and successful participating and winning in Tender processes (e.g. companies "Dioro", "Palvy", "Northen Power Laboratory", "Perspective" and others).

Almost all surveyed entrepreneurs showed a great interest in participating in seminars, trainings, obtaining of different consultations. Aspiration to obtaining of additional knowledge and skills demonstrates Slavutich companies’ readiness for work in the direction of increasing of effectiveness of participating in Tender processes.

After conducted monitoring there are the following results:

1. There is positive dynamics of Slavutich companies participating and winning in Tender processes. Referring to the information given by Chernobyl NPP Tender Committee in 2004 32.3% of the total amount of the Contracts are signed with Slavutich companies (in 2003 this pecentage was 20,7%). There is also quality growth of winning of Tenders by Slavutich companies.

2. Considerable part of Tenders is conducted on the procedure of Price Quotations. That is why Slavutich companies have to participate in Tenders constantly. As a result of conducted Tenders and fulfilling of Contract obligations the experience of collaboration is registered and it is considered in further as every Tender Committee has a list of suppliers of work and services.

3. Weak point of Slavutich companies is still price policy and insufficient level of economics knowledge. It is necessary to pay more attention for preparation of the staff and their participation in different training projects and programmes, trainings and seminars.

4. It is necessary to turn to information resources of Tender Committees publishing information about planned Tenders (pages of the Tender Committee on ChNPP Web-Site, official periodicals "Bulletin of State Purchases" World of Tenders") on constant basis.

5. In order to provide assistance for companies in increasing their competitiveness in the market of work and services it is necessary to conduct thematic seminars:

  • Ways of Increasing of Management Level;
  • Obtaining of Additional Permissions and Licenses;
  • Assistance in Preparation of Tender Documents;
  • Improving of Staff’s Qualification;
  • Implementation of Quality Assurance Programme’
  • New Technologies in Construction.


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