We are a small business being asked to tender for the supply of trees and shrubs over a period of years using a NEC3 supply Contract. This the first time we have seen this type of contract. We have been asked to tender against a price schedule of trees and shrubs AND also show the percentage for overheads and profit. What should be included in these fee percentages? The contract also says this percentage will be used in compensation events, how?
OK - first question is do you have a copy of the Supply Contract, and if not you need to get hold of one. For compensation events (and there is a list of what would be a compensation event in clause 60.1) that only affect the quantity of goods and services being provided then the rates within the Pricing Schedule are used and the percentage for overheads and profit would not apply. For any other compensation events, there will be a quotation submitted by you identifying costs that will be incurred in terms of people, equipment, plant and materials included in the goods, work subcontracted by the Supplier and lastly transport. The fixed “overhead ad profit” percentage you declared at tender stage in contract data part 2 will then be applied to those costs.
You will find more information within the “Guidance Notes” that is a separate book. If you do not have these, you can buy the full contract set or simply the “SC contract bundle” using the following link at a cost of £85 which includes the contract, guidance notes and flow charts: