Originally published in October 2024. Refreshed with new information and republished in November 2026. 

Types of Tendering in Construction

A guide for public sector buyers

Choosing how to take a public sector construction project to market can have a significant effect on competition, timescales, risk, supplier engagement and the quality of the eventual outcome.

Open tendering, selective tendering, two-stage tendering, design and build, frameworks and contract models may all influence how a project is procured, but they do not all describe the same thing.

This guide explains the terminology, outlines the statutory procedures available to public sector buyers under the Procurement Act 2023 and explores the wider tendering approaches commonly used across construction.

Jump to:

• Tendering and procurement in construction: what is the difference?

• Construction tendering under the Procurement Act 2023

• Open tendering in construction

• The competitive flexible procedure for construction projects

• Where does selective tendering in construction now fit?

• When might shortlisting be appropriate?

• Where does negotiated tendering fit?

• Can a public body negotiate directly with one contractor?

• Other types of tendering in construction

• Construction framework tendering

• Tendering through a dynamic market

•The role of early contractor engagement in construction tendering

• How Procurement Hub supports construction tendering

Tendering and procurement in construction: what is the difference?

Procurement is the complete process through which a buyer identifies a requirement, develops a commercial strategy, approaches the market, selects a supplier, awards a contract and manages delivery.

Tendering is one part of the procurement for construction process. It is the stage at which suppliers are invited to compete for a contract and submit information about matters such as price, quality, capability, delivery programme, risk, BNG and social value.

There are so many options when it comes to construction tendering in the UK because one process doesn’t fit all projects. When you’re embarking on a public sector construction project, it’s often the nature of the specific contract that helps to determine the best tendering route.

Construction tendering under the Procurement Act 2023

For public procurement projects governed by the Procurement Act 2023, which became law from February 2025, there are now two competitive tendering procedures:

• The open procedure

• The competitive flexible procedure

Both procedures are run through the publication of a tender notice. The open procedure is a single-stage process open to any interested supplier. The competitive flexible procedure enables the contracting authority to design a proportionate process suited to the requirement.

This represents a change from some of the legacy ways to tender for construction projects, but now elements such as shortlisting, negotiations and various tender stages can all be combined into a single flexible procedure, which are required to be clearly explained in the tender notice and associated documentation.

Open tendering in construction

Under the Procurement Act 2023, the open procedure is a single-stage process through which any interested supplier can submit a tender.

It can suit relatively straightforward construction requirements where:

• The specification and required outcomes can be clearly defined from the outset.

• The buyer does not need a separate shortlisting stage.

• Dialogue or negotiation is not required.

• The market has enough capable suppliers to support meaningful competition.

• The authority has sufficient resources to evaluate all compliant tenders received.

Advantages of open tendering

• Broad access to the opportunity

Publishing an open opportunity can attract contractors of different sizes and backgrounds, including SMEs and suppliers that have not previously worked with the buyer.

• Transparent competition

Every interested supplier can review the opportunity and decide whether to submit a tender, supporting openness and equal access.

• A straightforward process

Where the requirement is well developed, the open procedure can provide a relatively simple route from tender notice to evaluation and award.

Potential limitations of open tendering

• A high number of responses

A well-publicised opportunity may attract numerous tenders, increasing the time and resources required for clarification and evaluation.

• Unsuitable submissions

Some suppliers may submit tenders despite not having the capability, capacity or experience needed to deliver the project.

• Limited procedural flexibility

The open procedure does not include a separate participation stage through which the number of suppliers can be reduced before tenders are submitted. Complex projects requiring dialogue, negotiation or progressive shortlisting may therefore be better suited to a competitive flexible procedure.

The competitive flexible procedure for construction projects

The competitive flexible procedure enables public-sector buyers to design a procurement process around the nature, complexity and risks of the contract.

It can include one or more stages and may incorporate:

• Conditions of participation and supplier shortlisting.

• Initial and final tenders.

• Dialogue with participating suppliers.

• Negotiation where appropriate.

• Presentations, demonstrations or site visits.

• Progressive reductions in the number of suppliers or solutions.

• Refinement of requirements or award criteria where permitted.

• A best and final offer stage.

The procedure must remain transparent and proportionate. Buyers need to explain how it will operate in the tender notice and procurement documents, treat participating suppliers equally and follow the process you have published. Government guidance confirms that the procedure can be designed as a bespoke, multi-stage process incorporating commercial techniques such as negotiation and dialogue.

This flexibility can make the procedure particularly useful for complex construction projects where the buyer needs to test deliverability, explore technical solutions or involve contractors before every aspect of the design has been finalised.

Where does selective tendering in construction now fit?

Selective tendering in construction usually means that only a shortlist of suitable contractors is invited to submit a full tender. Under the Procurement Act 2023, selective tendering is not a separate public procurement procedure.

A public-sector buyer can achieve a similar result through a competitive flexible procedure or by using an existing framework agreement to access pre-approved suppliers.

When might shortlisting be appropriate?

Shortlisting can be useful where:

• The project requires specialist construction experience.

• Preparing and evaluating a full tender will involve significant time and cost.

• The market contains many potential suppliers but only a smaller number have the required capability.

• The project needs dialogue, negotiation or multiple evaluation stages.

• Security, technical or operational requirements are particularly complex.

The selection criteria must be relevant and proportionate. Requirements that are unnecessarily restrictive could prevent capable SMEs or newer market entrants from competing.

Where does negotiated tendering fit?

Negotiated tendering is a process through which a buyer negotiates with one or more contractors over matters such as scope, price, risk, programme or technical delivery.

Public bodies are not able to select one contractor simply because negotiating directly appears faster or because that supplier has specialist experience.

Within public procurement, negotiation can instead form part of a properly designed competitive flexible procedure or some framework solutions. Several suppliers might participate initially, with negotiation or dialogue taking place during clearly defined stages before final tenders are evaluated.

Can a public body negotiate directly with one contractor?

A public contract can only be directly awarded without a competitive tendering procedure where a legal justification applies. Those circumstances are defined by the Procurement Act and should not be interpreted simply as permission to choose a preferred contractor for convenience. A transparency notice and other procedural requirements may also apply. This is to ensure that the process is fair and adheres to the principles and objectives of the current regulations.

This statutory form of direct award should not be confused with awarding a call-off contract without competition under the terms of an existing framework. A framework may permit an award without further competition where its terms and objective selection mechanism allow it.

Other types of tendering in construction

Alongside the statutory procedures, several construction tendering strategies can influence how suppliers are engaged and how a project moves towards contract award.

Single-stage tendering

In single-stage tendering, contractors submit a complete tender based on sufficiently developed project information. The buyer evaluates the submissions and selects a contractor without a separate pre-construction appointment.

This approach can work well when:

• The design and specification are well developed.

• The scope is stable.

• The buyer wants competitive pricing before appointment.

• There is limited need for contractor input into the design.

The effectiveness of single-stage tendering depends on the quality of the tender information provided by the buyer. Gaps, uncertainty or a high likelihood of shifting scope can result in risk allowances, qualifications, pricing changes or disputes later in the project.

Two-stage tendering

Two-stage tendering brings a contractor into the project before the full construction price and contract are finalised.

During the first stage, contractors may compete on matters such as preliminaries, overheads, profit, experience, methodology and the capability of the proposed team. The selected contractor then works with the buyer and design team during a pre-construction stage. The parties subsequently seek to agree the final scope, risk allocation, programme and price.

Potential benefits include:

• Earlier contractor involvement.

• Improved buildability and programme planning.

• Earlier input from specialist subcontractors.

• Better identification of design and delivery risks.

• An opportunity to begin preparatory work while the wider design develops.

However, competitive tension may reduce after the first-stage appointment. Buyers therefore need clear processes, open-book information where appropriate and an agreed position if the parties cannot reach acceptable second-stage terms.

For public bodies, a two-stage strategy must sit within a compliant procedure or an appropriate framework process.

Serial tendering

Serial tendering can be used where a buyer expects to deliver a series of similar projects or repeat works.

A contractor may initially be appointed through a competitive process, with the resulting rates, pricing structure or tendered information used as the basis for later projects. Prices are generally adjusted to reflect matters such as inflation, location, project-specific requirements and market conditions.

Serial tendering can reduce duplicated procurement and help develop continuity across a programme. It is most suitable where:

• The works are genuinely similar.

• The programme and potential future requirements are sufficiently defined.

• The contractual arrangement permits subsequent projects.

• The pricing mechanism remains demonstrably appropriate.

• The buyer can continue to evidence value for money.

Public bodies cannot assume that an initial tender creates an unrestricted right to award future work. The proposed programme, scope and award mechanism must be supported by the original procurement and contract arrangements.

Tendering through a dynamic market

A dynamic market is a pre-existing procurement route that includes a list of suppliers that have met defined conditions for membership and are eligible to participate in future procurements under that market.

Unlike a closed framework, a dynamic market generally remains open to new suppliers that meet its conditions. Contracts awarded through a dynamic market must be procured using a competitive flexible procedure, inviting eligible suppliers from the relevant part of the market to participate.

This can be valuable where:

• Supplier markets change regularly.

• The buyer wants to encourage SME participation.

• Different categories or geographical areas are required.

• There is an ongoing programme of works.

• Specialist contractors may enter the market over time.

Dynamic markets replace Dynamic Purchasing Systems for new procurements under the Procurement Act, although some legacy DPS arrangements established under the previous rules remain operational during the transitional period.

The role of early contractor engagement in construction tendering

Early contract engagement enables buyers to draw on practical delivery expertise before the project scope, programme and commercial approach are fully fixed. Contractors can help test buildability, identify supply-chain constraints, highlight risks and challenge assumptions around materials, phasing and timescales. This can result in clearer tender documents, more realistic budgets and fewer costly changes once work begins.

It can be particularly valuable when using a procurement framework that permits direct award under its terms. Engaging the selected framework contractor early can help the buyer develop the requirement and agree how risks, pricing and project outcomes will be managed before the call-off contract is finalised. The buyer must still follow the framework’s award mechanism and maintain a clear audit trail showing why the supplier and route are appropriate.

Over the longer term, strong and transparent supply-chain partnerships can create further efficiencies. Greater visibility of future work helps contractors plan labour, materials and specialist capacity, while repeat collaboration enables teams to standardise processes and apply lessons from earlier projects. This strategic approach can reduce duplicated effort, avoidable variations and whole-life costs while improving certainty for both the buyer and delivery partners.

How to choose the right construction tendering approach for your project

The quickest process is not automatically the best one. Buyers should always consider the specific project, the market and your own capability before deciding how to proceed.

Project value and proportionality

The time, complexity and cost of the procurement should be proportionate to the value and risk of the contract. A relatively straightforward works package may not need a complex multi-stage procedure, but a strategically important development may justify more extensive engagement and evaluation.

Complexity and specialist requirements

Projects involving secure environments, occupied buildings, heritage assets, challenging ground conditions, specialist engineering or demanding sustainability standards may require more detailed supplier assessment or dialogue.

Urgency

A framework or existing procurement solution will usually offer a faster route than starting a new procurement process from scratch.

Design maturity

Where the scope and design are complete, single-stage tendering may support clear price comparison. Where significant design development remains, early contractor involvement or two-stage tendering may help identify risks and improve buildability.

Internal resources

An open procedure may appear simple but can create a substantial evaluation workload. A complex competitive flexible procedure also requires careful planning and active management. Buyers should assess whether they have the skills and capacity to run the proposed process effectively.

Market capacity

Early market engagement can help buyers understand supplier appetite, capacity, delivery constraints and realistic timescales before finalising the procedure. It can also identify whether requirements are unnecessarily limiting competition.

The Procurement Act permits preliminary market engagement before publication of a tender or transparency notice, provided it is conducted fairly and does not give any supplier an unfair advantage.

Risk allocation

Construction tenders can become expensive or difficult to compare when suppliers are asked to accept risks they cannot control. Buyers should consider which party is best placed to manage each risk and ensure the proposed contract model supports the procurement strategy.

Opportunities for SMEs

Large contract packages, disproportionate financial requirements and unnecessarily demanding experience criteria can exclude capable smaller suppliers. Appropriate lotting, regional packages, dynamic markets and proportionate conditions of participation can help widen access and encourage SME involvement.

How Procurement Hub supports construction tendering

Running a compliant tender is only part of delivering a successful public sector construction project. Buyers also need a route that is proportionate to the requirement, provides access to capable suppliers and supports the intended project outcomes.

At Procurement Hub, we offer a range of ready-made procurement solutions and support services, including:

Construction frameworks for major projects, refurbishment, asset management and decarbonisation.

Framework call-off competitions through which eligible suppliers can compete for a specific requirement.

Awards without competition under framework terms where the relevant framework permits this and provides an appropriate selection mechanism.

Dynamic Purchasing Systems and Dynamic Markets offering access to qualified suppliers and competitive procurement for individual contracts.

Tender support services covering areas such as procurement strategy, tender documentation, evaluation and process management.

Supplier networks spanning national organisations, SMEs and specialist contractors.

These options can reduce duplicated procurement activity while giving buyers flexibility to select a route appropriate to the project’s value, complexity, timescale and risk profile. Procurement Hub’s solutions include fully compliant frameworks and DPS or Dynamic Market routes supported by pre-approved supplier networks and a managed procurement team.

There is no single construction tendering approach that will suit every project. Starting with the requirement and understanding the different routes available to public buyers will help you make a more informed decision.

Explore our public sector construction procurement solutions or contact our specialist team about your next project to help you decide on the right construction tendering route.