Hudson Insight Series: PQQs in Construction

A PQQ in construction is used by buyers as the first stage of selection for potential suppliers.

This blog will cover everything that is asked for within a PQQ and how they are commonly formatted. It will also cover some frequently asked questions about PQQs in construction.

What is a PQQ in construction?

A PQQ stands for pre-qualification questionnaire. They’re used as part of the tendering process when a buyer is looking to procure works, goods or services.

Essentially, a PQQ in construction requires you to note basic company information, confirm statements of non-collusion and more. They can end up being quite a lengthy process, but there are some variations of PQQs in construction. It varies from buyer to buyer and depends on how they want to procure.

Is there any other format for a PQQ in construction?

Standard Selection Questionnaire

A PQQ in construction can also be referred to as a standard selection questionnaire (SQ). The aims of an SQ are to simplify the supplier selection process for smaller enterprises. It typically includes a self-declaration that you don’t meet any grounds for exclusion.

PAS91

A more common form of PQQ in construction is the PAS91. It is a standardised type of PQQ used in the construction industry. They are used by buyers to filter suppliers who might not be eligible, thus ensuring they’re getting top tier suppliers.

You must pass the PAS91 in order to progress onto the invitation to tender (ITT) stage. PAS91s are designed with small and medium-sized enterprises (SMEs) in mind. It simplifies the PQQ process thus encouraging more SMEs to become suppliers.

The PAS91 helps buyers identify the most suitably qualified suppliers quickly. This is because by passing, you are demonstrating that your business is qualified, fitting the minimum standards for the contract.

If you are a Constructionline member, you are automatically compliant to some PAS91 questions. Although this saves you a lot of time, it doesn’t mean you can skip this stage completely. You will most likely still need to complete a few questions in the PAS91.

The 2017 amendment to PAS91 now includes new questions covering mandatory reasons for exclusion and legislation. These relate to the Immigration Act and the Minimum Wage Act.

What does a PQQ in construction ask for?

You may be wondering what exactly a PQQ in construction asks for. Typically, you will be required to add information to the following 11 sections.

Company information

The first piece of information that is required for a PQQ in construction, is your company’s information. This includes your registration and VAT number. You will also be required to state what type of organisations you are and the contact details.

Grounds for mandatory rejection

This section simply required you to answer ‘yes’ or ‘no’ to questions relating to various statements. These are often to do with conspiracy, corruption, fraud and bribery.

Grounds for discretionary rejection

The grounds for discretionary rejection are similar to the grounds for mandatory rejection. You’re required to answer a series of ‘yes’ or ‘no’ questions stating your business hasn’t been convicted of criminal offences.

Economic and financial standing

For the economic and financial standing section, you will typically be asked for three things:

Annual turnover

Contractors will assess your annual turnover via your latest financial accounts. You should only apply to tenders that are 40 – 50% of your annual turnover and no more. Any higher, and it’s unlikely that you will be approved.

Financial ratios

You may be asked to attach asset test ratios. These may be assessed automatically through your attached accounts as part of your tender submission. Some PQQs require you to input this separately within the document. If unsure, your accountant should be able to support you with this.

Insurance

Buyers will want you to be aligned with the requirements set for insurance. Typically, buyers will allow you to increase your levels of insurance.

If you are unsure if you meet the necessary requirements, read the full specification. It will usually note the requirements and pre-requisites needed.

Technical and professional ability

A buyer will obviously want to know that your business is qualified to carry out the job at hand. They often want to see examples of past contracts you have completed that are of a similar scope. They may ask for up to three case studies within the last five years.

A strong response will include evidence from past clients, and you may be asked to attach past client’s information on. This is so they can be contacted by the buyer to confirm the accuracy of the information you provide. Backing up these case studies with concrete evidence will get you in the buyer’s good books.

An example of a typical question asking you to demonstrate your technical ability shared across PQQs in construction is:

“Please provide details of up to three contracts from either or both the public or private sector, that are relevant to the Authority’s requirement. Contracts for the supply of services should have been performed during the past three years.”

The word count for answers can vary from as little as 150 over 1000. If this seems a little overwhelming, you could try breaking the question down into key sections. This is known as the STAR method that helps you detail the:

- Situation – an introduction.
- Task – the specifics of the tasks at hand.
- Actions – how you delivered the contract, including key challenges faced.
- Results – detail the success of the contract and emphasise why you’re the best business for the job.

It may also be worth noting any unexpected complications you faced while fulfilling these contracts and how you overcame them. This allows you to demonstrate initiative, problem-solving skills and flexibility which are key with any construction project.

Staff and subcontractor’s information

You most likely will be required to provide the staffing and subcontractor information you intend to use if successful. You’ll likely need to demonstrate that they have the capabilities and experience to guarantee a successful project. This can include:

- CVs
- Summary introductions to team members
- Provisions of qualification documents

You want to convey to the contractor that you know what you’re doing and can deliver the project successfully.

Project-specific questions

This includes technical capability such as any qualifications and accreditations and project-specific questions. Some examples of potentially relevant qualifications and accreditations needed for a PQQ in construction are:

- ISO 9001; 14001; 18001
- CSCS Card
- CPCS
- BIM
- SSIP
IOSH
- Subcontractor
- CHAS
- SafeContractor
- Health and safety

The buyer wants to be assured that your company works to the highest health and safety authority. It is one of the most important sections of a PQQ in construction. They want to be sure potential suppliers can deliver the work as safely as possible. You need to demonstrate clear levels of accountability to ensure works are delivered in accordance with the appropriate regulations. For example:

- CDN 2015
- Health and Safety At Work Act 1974

If completing a PAS91 – you will be exempt from completing this section if you have:

- Completed a PAS91 question set within the last 12 months.
- A formally recognised management system such as OHSAS 18001;2007 or ISO 45001;2018.
- A SSIP health and safety accreditation such as SafeContractor or CHAS.

If you don’t have these, then you will be asked a series of questions regarding your health and safety policies and procedures. Areas that could be covered are:

- The training of staff and how you keep them up to date regarding health and safety practices.
- Risk assessment and accident reporting (RIDDOR).
- Reviewing policies, procedures and compliance with best practice.

Quality assurance

A PQQ in construction is likely to have a section on quality assurance. For this, suppliers will often have to answer noting their approach to performance management. This can include the likes of:

- Quality assurance and training procedures.
- How you manage the underperformance of employees and how you discuss this with them.
- Reviews of policies, procedures and compliance with best practice.
- Inspections, audits and any other means of performance management you may use.

If you’re certified with ISO 9001 and provide a certification to show this, you can be exempted from completing this. If you don’t, you can provide training records and even inspection reports to back this up.

Environmental management policy

A businesses environmental management policy is an ever increasingly important section within a construction PQQ. You will be required to provide evidence responses to the questions. This could be done with the provision of policies and procedures your company holds. They must state that youC’re undertaking the appropriate due diligence to minimise your environmental impact. Areas that can be covered include:

- How you’re reducing waste and encouraging recycling.
- Reducing carbon emissions.
- Training and maximising environmental awareness.
- This can be bypassed, however, if you hold an ISO 14001.

Equal opportunities policy

You will need to include your company’s equality and diversity policy. This is to ensure you are maximising equal opportunities for all employees regardless of sex, relationship status or ethnicity. Your business’s equal opportunities policy needs to be in line with the Equality Act 2010.

Need help completing your PQQ for construction?

Here at Hudson Succeed, we offer four bid writing packages to suit your businesses’ needs. For more information on how we can help you complete a successful PQQ in construction, get in touch.

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