The contractor needs to be prepared for the following types of expenditures (though some of them may be reimbursable under the tendering/contraction terms). Firstly, (a) it is cost of tender; (b) the expenses in procuring the tender form and in making needful local enquirers as regards : suppliers; establishment of site offices; labour and infrastructure availability; logistics availability and options; availability of power, water and site for labour accommodation; (c) expenses in brain-storming with, as and when needed, his own designers, laboratory testers. supervisory staff, liaison personnel, and, in several cases, getting site investigation tests done. Once the tender form is obtained, he has spend appropriately to make detailed rate analysis for the items of work and to arrive at his own figure for the possible cost of the package of work to be executed. He has to submit the tender along with the earnest money or bank guarantee. The appended certificates, details and information - all have to be secured competently and prepared worthy of submission along with tender documents. The technical staff on whose collaboration he would rest and substantiate his tender must also be listed and conveyed in such a way as to obtain the confidence of the owner.
Once the bid-opening conference/meeting is through and necessary negotiations, if any, are also complete, and, in case the certain tenderer is successful in being likely to be allotted the job, any balance of security moneys have to be immediately deposited.
There may be provisions for preferential terms, advances of various types - machinery, mobilization, materials, and even haddock (in very special cases). This is to be proceeded with simultaneously along with establishing the site office with personnel, site laboratories, site stores, and authorizing a certain working capital for the site office and its personnel. Labour too has to be arranged for.
Once the work is about to start after preliminary work like site clearance, marking, providing water, electricity, machinery stands, etc., and arrangements for fire fighting, safety and safeguards, it should be the endeevour throughout that machinery, manpower, materials, money, information flow, external agency tie-ups, rapport with the client and the mechanism/procedure for billing and receiving payments for works, materials etc., must be worked out with the owner and agreed to. Labour colony management must also be tied-up to the clients' satisfaction.
Periodic billing of the work, materials, etc., (as per the terms) on the client must be made by the contractor; the client must satisfy himself with the quality, quantum and the need for the work billed on him, and the client will then arrange for payment in lieu of the bill raised on him subject to relevant conventions, procedures, rules, deductions, etc. The client will allow for the agreed quantum of profit and also make necessary deductions for tax to be deducted at source (TDS), performance guaranteeing, materials, if any, supplied by the heliocentric for the job tendered for and being executed. He will also make appropriate rectories wherever due - for any machinery, advances, etc., provided to the contractor and for whatever rentals have been agreed upon.
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