Analysis of Factors affecting Construction Project Tender Winning in Small Qualification Contractors

Abstract

Finding employment in the construction sector almost always involves a tender process, which is essential for the construction entrepreneurs because the company's continuity depends on it. Tender qualifications and requirements must fulfill several stages, namely the administrative, qualification, technical, and price evaluation. The purpose of this research is to predict the relationship between certain variables. The Partial Least Square (PLS) method is deployed since it can directly analyze the latent variables, indicator variables, and measurement errors and determine the complexity of the relationship between several variables and their indicators. Eight main factors were successfully obtained: Regulations, Company Qualifications, Administration, Equipment Resources, Human Resources, Construction Safety Plan, Financial, and Technology and Information Systems. Using the SEM-PLS also resulted in estimating the significance value of the factors influencing the highest tender winner determinants: Human Resources obtained a value of 84.5% and the Financial variable attained a value of 82.3%. This research is expected to assist contractors in getting acquainted with the level of significance of the tender winners’ determinants for the construction projects. Contractors can also prepare and improve the Human Resources factor by conducting advanced training, certification, and competency development that supports its technical capabilities. Contractors need to obtain a deep understanding of the tender requirements, and with a high experience level they can make more appropriate and competitive offers.

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