Jurisdiction(s):
United Kingdom

Key definition

Two-stage tendering definition

What does Two-stage tendering mean? Two-stage tendering describes a construction procurement method in which the employer appoints a contractor at an early stage on the basis of an initial tender against outline design information and a basic programme, with price elements limited to preliminaries, overheads and profit, key rates and methodology. The second stage involves the same contractor working with the employer (and the design team) to advise on buildability, develop the specification and detailed designs, plan the works and procure work packages, usually under a pre-construction services agreement, before finalising the contract sum on an open-book basis for construction. This two...

Two-stage tendering in construction: legal and practical overview of stages, use of PCSAs, open-book pricing, risk allocation, and advantages and disadvantages versus single-stage tendering

Published by a LexisNexis Construction expert

Practice notes

This Practice Note sets out the ‘two-stage tendering’ method widely adopted to procure building schemes. Many clients opt for two-stage tendering to bring a contractor on board sooner. It allows the client and the chosen contractor to collaborate in the second phase, with the contractor contributing to design, buildability and value engineering, while firming up the final price for the works. Two-stage tendering is most often applied when letting lump sum contracts, in both traditional and design and build procurement.

How does it differ from traditional single stage tendering?

Two-stage tendering is increasingly favoured as an alternative to the classic single stage route. Under single stage tendering, contractors submit a bid for the scheme on the basis of a design illustrated by drawings and a specification or, for design and build, the employer’s requirements and an agreed programme. After reviewing the returns, the employer selects the contractor it intends to appoint and with whom it will enter the building contract. As a result, the contractor typically has no pre-construction involvement in the project before signing the building contract and commencing the works. There is therefore no early contractor involvement before contract award under the single stage model approach...

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Web page updated on 21/05/2026

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