Factors Affecting on Tender Pricing of Infrastructure ... · Factors Affecting on Tender Pricing of...

Factors Affecting on Tender Pricing of Infrastructure Projects

in the Gaza Strip

البنية التحتية العوامل المؤثرة على تسعير عطاءات مشاريع

في قطاع غزة

By:

Noor K. Al-Ghazalli

Supervised by:

Dr. Bassam A. Tayeh

Assistant Professor of Structural Engineering

A thesis is submitted in partial fulfillment of the

requirement for Degree of Master of Science in Civil

Engineering, Infrastructure Construction, The Islamic

University of Gaza

October, 2017

زةــغب ةــالميــــــة اإلســـــــــامعـالج

والدراسات العلياشئون البحث العلمي

الهـنـدســـــــــــــــــــةة ـــــــــــــــليـك

البنيــــــــــة التحتيـــــــــــةـــــر ـــماجستيــ

The Islamic University Of Gaza

Research and Postgraduate Affairs

Faculty of Engineering

Master of Infrastructure

II

إقــــــــــــــرار

أنا الموقع أدناه مقدم الرسالة التي تحمل العنوان:

The Factors Affecting on Tender Pricing in Infrastructure

Projects in the Gaza Strip

على تسعير عطاءات مشاريع البنية التحتية في قطاع غزةالعوامل المؤثرة

أقر بأن ما اشتملت عليه هذه الرسالة إنما هو نتاج جهدي الخاص، باستثناء ما تمت اإلشارة إليه حيثما ورد،

لنيل درجة أو لقب علمي أو بحثي لدى أي االخرين وأن هذه الرسالة ككل أو أي جزء منها لم يقدم من قبل

.مؤسسة تعليمية أو بحثية أخرى

Declaration

I understand the nature of plagiarism, and I am aware of the University’s policy on

this.

The work provided in this thesis, unless otherwise referenced, is the researcher's own

work, and has not been submitted by others elsewhere for any other degree or

qualification.

:Student's name نور خليل الغزالي اسم الطالب:

:Signature نور الغزالي التوقيع:

:Date 30/05/2018 التاريخ:

III

نتيجة الحكم

IV

Abstract

Purpose: Studying the factors affecting on the tender pricing for construction projects,

especially the infrastructure projects in the Gaza Strip, throughout (1)studying the main

factors affecting on tender pricing by considering the project parties (The owner, the

consultant, the contractor and the donor), in addition to the market and the project, and (2)

Identification of the most important problems that the contractor deals with in pricing the

tender.

Research Methodology: A number of researches and scientific papers related to the field

of study were studied. A questionnaire was designed according to the quantitative scale

methodology in this research. The final version of the questionnaire was obtained by (1)

Arbitration of the questionnaire by 12 experts in construction especially in infrastructure

sector in the Gaza Strip, where they were used to revise and measure the clarity and ease of

understanding of the factors included in the questionnaire, and 122 questionnaires were

distributed to the parties involved (construction companies and consulting offices).

The questionnaire results: Throughout previous studies and arbitration of the

questionnaire, 61 indicators were collected, divided into six sections, as follows: (1)

Factors affecting on tender pricing which are related to the owner, consists of 11 factors,

(2) Factors affecting on tender pricing which are related to the consultant, consists of 6

factors, (3) The factors affecting on tender pricing which are related to the contractor,

consists of 27 factors, (4) factors affecting on tender pricing which are related to the

donor, consists of 6 factors, (5) factors affecting on tender pricing which are related to the

market and the external environment, consists of 11 factors, (6) factors affecting on tender

pricing which are related to the project, consists of 7 factors. The RII of the group of

factors related to the owner was 78.89%. The highest factors were the financial

performance of the owner, and the accuracy in estimation the work to be implemented,

and RII of the group of factors related to the consultant was 81.33%. The highest factors

were the accuracy of the quantities listed by the consultant in the Bill of quantities, and

the quality and accuracy of the tender documents provided by the consultant. The most

significant factor was the coordination between the owner and the project donor, the

requirements of the financial payments for the project, The RII of the group of factors

related to the market was 79.00%. The most important factor was the status of the

crossings and the continuous closure thereof, and the change in local currency prices.

V

الملخص

تتميز صناعة التشييد بطبيعة معقدة وتواجه عدة تحديات من ضمنها ارتفاع التكاليف عما تم تسعيره في الغرض:ذلك كان الغرض من هذا البحث، دراسة العوامل المؤثرة على العطاءات، والمنافسة ما بين المقاولين، وبناء على

تسعير عطاءات مشاريع التشييد خصوصا مشاريع البنية التحتية في قطاع غزة، وذلك عن طريق هدفين أساسيين هماقاول، متحديد أهم العوامل المؤثرة على تسعير العطاء والتي لها عالقة بأطراف المشروع )المالك، االستشاري، ال( 1)

تعريف بأهم المشاكل التي يقوم بها المقاول في تسعيره (2) والممول( باإلضافة إلى السوق وطبيعة المشروع نفسه، للعطاء.

تم دراسة العديد من األبحاث واألوراق العلمية ذات العالقة بمجال الدراسة ومن خاللها تم تصميم منهجية البحث:ي هذا البحث، وتم الوصول إلى النسخة النهائية من االستبانة عن طريق تحكيم استبانة وفق منهاج المقياس الكمي ف

من الخبراء في مجال التشييد قسم البنية التحتية بغزة، حيث تم االستعانة بهم من أجل تنقيح 12االستبانة من قبل على األطراف المعنية بتعبئتها استبانة 122وقياس مدى وضوح وسهولة فهم العوامل الواردة في االستبانة، ثم تم توزيع

ة(.وهي )شركات المقاوالت والمكاتب االستشاري

(1)مؤشر، قسمت لستة أقسام، كالتالي: 61من خالل الدراسات السابقة وتحكيم االستبانة تم تجميع نتائج االستبانة:العوامل المؤثرة على تسعير (2)، مؤشر 11العوامل المؤثرة على تسعير العطاءات ولها عالقة بالمالك والتي اشتملت

العوامل المؤثرة على تسعير العطاءات ولها عالقة (3)مؤشرات، 6العطاءات ولها عالقة باالستشاري والتي اشتملت 6العوامل المؤثرة على تسعير العطاءات ولها عالقة بالممول والتي شملت ((4مؤشرا، 27بالمقاول والتي اشتملت

11العوامل المؤثرة على تسعير العطاءات ولها عالقة بالسوق والبيئة الخارجية والتي اشتملت على (5)مؤشرات، .مؤشرات 7العوامل المؤثرة على تسعير العطاءات ولها عالقة بالمشروع نفسه والتي اشتملت على (6)مؤشرا،

مقسمة على 61جميع العوامل والتي عددها وتم استخدام التحليل العاملي، لترتيب المؤشرات، حيث أظهرت النتائج أنوكان أعلى العوامل %78.89مجموعات، كان متوسط الوزن النسبي لمجموعة العوامل المؤثرة ولها عالقة بالمالك 6

هو األداء المالي للمالك، ودقة المالك في تقدير األعمال التي سيتم انجازها، وكان متوسط الوزن النسبي لمجموعة تأثيرا حيث كان أعلى العوامل تأثيرا مدى دقة الكميات التي يدرجها %81.33عوامل المؤثرة ولها عالقة باالستشاري ال

االستشاري في جداول الكميات، وجودة ودقة وثائق العطاء التي يقدمها االستشاري، وكان متوسط الوزن النسبي ن أعلى العوامل تأثيرا قيام المقاولون بزيارات ميدانية حيث كا %78.89لمجموعة العوامل المؤثرة ولها عالقة بالمقاول

لموقع المشروع، ودراسة وثائق العطاء بشكل دقيق، وكان متوسط الوزن النسبي لمجموعة العوامل المؤثرة ولها عالقة لدفعات احيث كان أكثر العوامل تأثيرا التنسيق بين المالك والجهة الممولة للمشروع، ومتطلبات %79.22بالممول

حيث كان أكثر %79.00المالية للمشروع، وكان متوسط الوزن النسبي لمجموعة العوامل المؤثرة ولها عالقة بالسوق العوامل تأثيرا وضع المعابر واإلغالق المستمر لها، والتغير في أسعار العمالت المحلية.

VI

الحكيم العليم أنت إنك علمتنا ما إال لنا علم ال سبحانك قالوا

صدق الله العظيم

{ 32سورة البقرة، آية }

VII

Dedication

This research is dedicated to all people who inspired, supported and encouraged me. " To my Parents, thanks for your lovely support."

" To my Wife, sons for their encouragement, support and putting up with the long

hours.

" To my Brothers and Sisters, thanks for making my life happy ."

" To my great teachers, thanks for all the things you have done for me."

" To my friends who encourage and support me."

" To those who taught me success and patience."

VIII

Acknowledgements

I would like to introduce my thanks and gratitude to those who have been the cause of

the continuation and completion of my life. Those who have stood with me in the most

difficult situations, and motivated me to persevere. I offer you the most beautiful words

of thanks and gratitude from a heart that respects you.

Special thanks to Dr. Bassam Tayeh, for his contribution and valuable opinion, also

my thanks to the staff and deans of the faculty of Engineering, in the Islamic University

of Gaza.

Great thanks to contractors and consultants in the Gaza Strip, for their enormous help

in collecting surveys and their participation in the questionnaire.

IX

Table of contents

Abstract… ........................................................................................................................................... IV

V..…………………………………………………………………………………………………الملخص

Dedication .......................................................................................................................................... VII

Acknowledgements ..........................................................................................................................VIII

List of Abbreviations ....................................................................................................................... XIV

Chapter 1 Introduction ....................................................................................................................... 2

1.1 Background .......................................................................................................................... 2

1.2 Statement of the Problem ................................................................................................... 2

1.3 Research Hypothesizes ........................................................................................................ 3

1.4 Research Limitation ............................................................................................................ 4

1.5 Research Layout .................................................................................................................. 5

Chapter 2 Literature Review .............................................................................................................. 7

2.1 Introduction ......................................................................................................................... 7

2.2 Definition and Concept ....................................................................................................... 7

2.2.1 Definition of Tender and Tendering Process .................................................................... 8

2.2.2 Definition of Project Team ................................................................................................. 8

2.2.3 Definition of Tender Pricing ............................................................................................... 8

2.2.4 Definition of Cost Overrun ................................................................................................. 9

2.2.5 Definition of Project Finance .............................................................................................. 9

2.2.6 Relationship Between Donors and Owners ..................................................................... 10

2.3 Pricing Strategy ................................................................................................................. 10

2.3.1 Market Based Pricing Strategy ........................................................................................ 11

2.4 Causes of Cost Overrun .................................................................................................... 11

2.5 Cost Control ....................................................................................................................... 13

2.6 Cost Estimation ................................................................................................................. 13

2.6.1 The Purpose of Cost Estimation ....................................................................................... 14

2.6.2 Types of Construction Cost Estimation ........................................................................... 14

2.6.3 Classification of Construction Cost ................................................................................. 15

2.7 Elements of Tender Cost ................................................................................................... 17

2.8 Finalizing Tender Pricing ................................................................................................. 19

2.9 Factors for the Questionnaire........................................................................................... 22

Chapter 3 Research Methodology .................................................................................................... 28

3.1 Introduction ....................................................................................................................... 28

3.2 Research Framework ........................................................................................................ 28

3.3 Research Period ................................................................................................................. 30

3.4 Research Location ............................................................................................................. 30

X

3.5 Research Population and Size .......................................................................................... 30

3.5.1 Research population: ........................................................................................................ 30

3.6 Questionnaire Content ...................................................................................................... 31

3.7 Pilot Study .......................................................................................................................... 36

3.8 Validity of the Research .................................................................................................... 37

3.8.1 Content Validity of the Questionnaire ............................................................................. 37

3.8.2 Statistical Validity of the Questionnaire .......................................................................... 37

3.8.3 Criterion Related Validity ................................................................................................ 37

3.8.3.1 Internal Consistency ......................................................................................................... 37

3.8.3.2 Structure Validity of the Questionnaire .......................................................................... 38

3.9 Reliability of the Research ................................................................................................ 39

3.9.1 Split Half Coefficient ......................................................................................................... 39

3.9.2 Cronbach's Coefficient Alpha: ......................................................................................... 40

Chapter 4 Results and Discussion ..................................................................................................... 42

4.1 Scope ................................................................................................................................... 42

4.2 One -Sample K-S Test for Normality .............................................................................. 42

4.3 Research Hypothesis ......................................................................................................... 43

4.3.1 Hypothesis #1: .................................................................................................................... 43

4.3.2 Hypothesis #2: .................................................................................................................... 57

Chapter 5 Conclusions and Recommendations ................................................................................ 66

5.1 Introduction ....................................................................................................................... 66

5.2.1 Findings About the Factors Affecting on Tender Pricing Related to the Owner......... 67

5.2.2 Findings About the Factors Affecting on Tender Pricing Related to the Consultant . 67

5.2.3 Findings About the Factors Affecting on Tender Pricing Related to the Contractor . 68

5.2.4 Findings About the Factors Affecting on Tender Pricing Related to the Donor ......... 69

5.2.5 Findings About the Factors Affecting on Tender Pricing Related to the Market ....... 70

5.2.6 Findings About the Factors Affecting on Tender Pricing Related to the Project ........ 71

5.3 Recommendations ............................................................................................................. 72

5.3.1 Recommendations For the Contractors in the Gaza strip ............................................. 72

5.3.2 Recommendations For the Consultants and Owners in the Gaza strip ........................ 73

5.3.3 Recommendations During the Preparation of Tender Documents ............................... 74

5.4 Recommendations for Further Research ........................................................................ 74

References ............................................................................................................................................ 76

Appendix (A): Questionnaire in English ........................................................................................... 81

Appendix (B): Questionnaire in Arabic ............................................................................................ 87

XI

List of Tables

Table (2.1): Factors affecting on tender pricing related to the owner ................................................... 22

Table (2.2): Factors affecting on tender pricing related to the consultant ............................................. 22

Table (2.3): Factors affecting on tender pricing related to the contractor ............................................. 23

Table (2.4): Factors affecting on tender pricing related to the domor................................................... 25

Table (2.5): Factors affecting on tender pricing related to the market .................................................. 25

Table (2.6): Factors affecting on tender pricing related to the project .................................................. 26

Table (3.1): Company or institution type .............................................................................................. 32

Table (3.2): Respondent's qualification degree ..................................................................................... 32

Table (3.3): Respondent's job in the company ...................................................................................... 33

Table (3.4): Respondent's experience years in an infrastructure sector ................................................ 33

Table (3.5): Company's experience years in an infrastructure sector.................................................... 34

Table (3.6): The company's recently implemented project cost ............................................................ 34

Table (3.7): The financial value of an implemented projects in the last 5 years ................................... 35

Table (3.8): The Likert scale ................................................................................................................. 36

Table (3.9): The correlation coefficient between each paragraph in the field ....................................... 38

Table (3.10): The correlation coefficient between each paragraph in the field ..................................... 38

Table (3.11): Structure validity of the questionnaire ............................................................................ 39

Table (3.12): Split Half coefficient ....................................................................................................... 40

Table (3.13): Cronbach's coefficient alpha ........................................................................................... 40

Table (4.1): One -sample K-S test for normality .................................................................................. 42

Table (4.2): RII and P-value for factors related to the owner ............................................................... 44

Table (4.3): RII and P-value for factors related to the consultant ......................................................... 46

Table (4.4): RII and P-value for factors related to the contractor ......................................................... 48

Table (4.5): RII and P-value for factors related to the donor ................................................................ 51

Table (4.6): RII and P-value for factors related to the market .............................................................. 53

Table (4.7): RII and P-value for factors related to e project ................................................................. 55

Table (4.8): Mean for factors affecting on tender pricing in the Gaza Strip ......................................... 57

Table (4.9): One-way ANOVA test for differences between the factors due to company type ............ 58

Table (4.10): Scheffe test for multiple comparison due to company type ............................................ 59

Table (4.11): One-way ANOVA test for differences between the Factors due to Qualification

Degree ................................................................................................................................................... 59

Table (4.12): One-way ANOVA test for differences between the Factors due to Respondent’s job in

the company .......................................................................................................................................... 60

Table (4.13): Scheffe test for multiple comparison due to Respondent’s job in the company.............. 61

Table (4.14): One-way ANOVA test for differences between the Factors due to respondent’s

experience in Infrastructure sector ........................................................................................................ 61

Table (4.15): One-way ANOVA test for differences between the Factors due to company’s experience

years in an infrastructure sector ............................................................................................................ 62

XII

Table (4.16):One-way ANOVA test for differences between the Factors due to the last implemented

project’s cost. ........................................................................................................................................ 63

Table (4.17): One-way ANOVA test for differences between the Factors due to the financial value of

the implemented projects in the last five years. .................................................................................... 64

XIII

List of Figures

Figure (3.1): Framework of the research Methodology............................................................... 30

Figure (3.2): Percentages of respondent's due to qualification degree ..................................... 32

Figure (3.3): Percentages of respondent's due to respondent's job in the company ................ 33

Figure (3.4): Percentages of respondent's due to respondent's experience years in

infrastructure ...................................................................................................................................... 34

Figure (3.5): Percentages of the recently implemented project's cost ....................................... 35

Figure (4.1): RII for the factors related to the owner................................................................... 45

Figure (4.2): RII for the factors related to the consultant ........................................................... 47

Figure (4.4): RII for the factors related to the market ................................................................. 54

Figure (4.5): RII for the factors related to the project ................................................................. 56

XIV

List of Abbreviations

ANOVA : Analysis Of Variance

CFs : Critical Factors

GDP : Gross Domestic Product

NGOs : Non-Governmental Organizations

PPP : Public-Private Partnership

RII : Relative Importance Index

SIGMA : Support for Improvement in Governance and Management

SPSS : Statistical Package for Social Science

Chapter 1

Introduction

2

Chapter 1

Introduction

This chapter presents a general introduction to the research, which provides problem

statement, aim, objectives, hypotheses, limitations and an overview of chapters.

1.1 Background

The pricing process is very useful, as it enables construction companies to determine their

direct costs, and provide a maximum cost that is less economical for them to do. Similarly,

the estimated cost could lead to a situation in which the contractor suffered losses. If the

contractor is selected, the estimate should also provide the basis for project budgeting and

control. The construction industry is widely diversified and there are many factors affecting

the results of its projects. As construction projects become larger and more

complex, the management and challenges of these projects become more complex to

succeed. Over the past few years, many construction projects in Gaza have bypassed the

time line with additional costing problems, especially in infrastructure projects, faced many

obstacles to the contracting process and companies, and generally contract employment fails

to take what it deserves to proportionally develop. It is clear that successful bidding is critical

to the presence of contractors. However, the basic fact of competitive bidding, particularly

in key actions, is that the lowest bids are often the least exposed to risks that can have serious

consequences. So in this dissertation, you need to examine these problems from the point of

view of contract parties (landlord, donor institutes, consultants, contractors).

1.2 Statement of the Problem

The construction project goes through the concept stages, design chart, bidding, contracting,

construction, service, and maintenance. Key participants and stakeholders are different from

the stages, as is the case with relevant technical know-how, technologies and professional

experiences (Meng, 2012). Each construction project is unique and has unique complexities

and risks across many issues at all stages of the construction process (Adnan et al. , 2011).

In the past few years, many of construction projects in the Gaza Strip, particularly in

infrastructure projects, have faced problems in the bidding process for reasons that are

believed to be beyond the control of contractors and their owners.

3

Therefore, This thesis is trying to study this phenomenon and investigating the factors

affecting on tender pricing in an infrastructure projects in the Gaza Strip from the

perspective of the contract parties.

1.3 Research Aim, Objectives, and Hypothesizes

Research Aim

The main aim of this research is to investigate the critical factors affecting on tender pricing

in an infrastructure projects in the Gaza Strip.

Research Objectives

There are many objectives, which can be summarized as the following:

1. To determine the factors affecting on tender pricing in the Gaza Strip.

2. To investigate the problems resulting from tender pricing mistakes.

Research Hypothesizes

Using a structured questionnaire and by analyzing the collected data, and by testing the

following hypothesis:

Hypothesis 1"H0": Null Hypothesis: There is no a significant statistical relationship at

level (α ≤ 0.05 ) in respondents evaluations for critical factors related to the owner which

affected on tender pricing in the Gaza Strip.

Hypothesis 1"H1": Alternative Hypothesis: There is a significant statistical relationship at

level (α ≤ 0.05) in respondents evaluations for critical factors related to the owner which


Hypothesis 2"H0": Null Hypothesis: There is no significant statistical relationship at level

(α ≤ 0.05 ) in respondents evaluations for critical factors related to the consultant which



level (α ≤ 0.05) in respondents evaluations for critical factors related to the consultant

which affected on tender pricing in the Gaza Strip.


(α ≤ 0.05 ) in respondents evaluations for critical factors related to the contractor which


4


level (α ≤ 0.05) in respondents evaluations for critical factors related to the contractor which



(α ≤ 0.05 ) in respondents evaluations for critical factors related to the donor which affected

on tender pricing in the Gaza Strip.


level (α ≤ 0.05) in respondents evaluations for critical factors related to the donor which



(α ≤ 0.05 ) in respondents evaluations for critical factors related to the market which affected



level (α ≤ 0.05) in respondents evaluations for critical factors related to the market which



(α ≤ 0.05 ) in respondents evaluations for critical factors related to the project which affected



level (α ≤ 0.05) in respondents evaluations for critical factors related to the project which



(α ≤ 0.05 ) in respondents evaluations for critical factors due to company type.


level (α ≤ 0.05 ) in respondents evaluations for critical factors due to company type.

1.4 Research Limitation

The scope of the thesis is to show the main factors affecting on tender pricing of

infrastructure projects in the Gaza Strip, and the limitation are as the following:

1. The research only for infrastructure construction projects in the Gaza Strip.

2. The research is based on questionnaire only.

5

3. The sample of this research is the project-related parties, i.e., Contractors,

Consultants, Donors, and owners.

1.5 Research Layout

The thesis consists of five chapters as follows:

Chapter 1: Introduction: Which contains a general introduction to the subject of the

thesis. It describes the research background, statement of the problem, research aim and

objectives, research limitations and research layout.

Chapter 2: Literature review: Which discusses general concepts of criteria which

considered as a key performance indicators and critical factors, and also mentioned the

previous studies in this field.

Chapter 3: Methodology: Which defines the process of the methodology that will be

applied through the research.

Chapter 4: Results and Discussion: Which presents the results of the research and

discusses them in details.

Chapter 5: Conclusions and Recommendations: Which states the conclusions and

recommendations for the research.

6

Chapter 2

Literature Review

7

Chapter 2

Literature Review

2.1 Introduction

Tender evaluation is the stage in which the contracting authority determines which tenders

meet the specific requirements, preferably on the basis of the pre-announced award criteria,

which are either the lowest price or the most economical bidding tender. The tenderer, whose

tender was awarded as the lowest price or most economically beneficial, as the case may be,

was awarded the contract (SIGMA, 2011).

Over the last few years, many of construction projects in the Gaza Strip have exceeded the

schedule and cost, and many obstacles faced the contracting companies for reasons that are

believed to be beyond the control of contractors and owners. These problems and obstacles

have led to many of claims and conflicts (Shweiki et al., 2013).

This chapter contains basic definitions and concepts related to the pricing process of

infrastructure projects and tendering, and investigating the factors which influencing the

pricing related to the project's parties. A detailed literature review and background survey is

included as well.

2.2 Definition and Concept

Public infrastructure projects have been funded and fully built by the state, but the large

capital required along with excesses often cost and lack of demand due to bias optimism and

strategic underestimation often led to haunted public infrastructure projects (Flyvbjerg et

al., 2004).

In the present, public infrastructure projects are often developed within the framework of

the specialized public-private partnership (PPP) or private financing initiative in which the

private party provides a public service or a project with significant financial, technical and

operational risks (Palmer, 2000) .

According to Goatham (2016), the causes of project failure is important, without a common

definition of "success", there is no clear basis for distinguishing between success and failure.

On the surface, the definition of success may seem relatively simple, but in reality different

people know success in different ways, i.e. the project is a success if it delivers all or more

of what it will be, regardless of schedule or budget performance.

8

2.2.1 Definition of Tender and Tendering Process

FIDIC (1987) defines the "tender" as the bid submitted by the contractor to the employer for

the implementation and completion of the works and the handling of any defects in

accordance with the terms of the contract, as accepted in the letter of acceptance.

(Karim, 2009) defined "Tender process" as an offers from one bidder or a number of

competitive bidders hoping that they will be given work, services or goods. The whole

bidding process in the construction and engineering sector is a comprehensive and complex

procurement process and a very costly exercise for the employer and tenderer (Teo, 2009).

Special bidding for large and complex projects can be very costly process for employers and

tenderers, but this will be money that's well spent if goals are met successfully (Tamimi,

2009).

Many experts in the construction industry agree that the appropriate tender process meets

two objectives: (a) the employer obtains a competitive and realistic price for the project he

intends to do, and (b) the contractor or the bidder conducts investigations before submitting

the tender, fully understands the requirements or nature Proposed work and employer

requirements.

2.2.2 Definition of Project Team

A team is a group of people who have a predetermined purpose to achieve a goal or set of

goals through collective efforts, resources and responsibility for results achieved.

Oyedele (2010) described a team as a few people who have complementary skills committed

to a common purpose, performance goals, It has mutual responsibility. In the context of a

construction project, a team can be described as a group of people assembled for a temporary

endeavor to achieve a specific goal. Project teams play an important role not only in

traditional projects such as the development of new products, systems design, and

construction but also in implementing organizational change, the transfer of technology

concepts and the implementation of unique projects such as construction (Thamhain, 2004).

The project team is an employee, or an external consultant or a contractor appointed to work

in full or in part time on specific tasks in the project. Team members involved in task

definition, estimation, and measurement as well as doing the work. They must be involved

in project management to make them more committed to the project. So they can identify,

investigate and suggest possible solutions to some problems (Lintz, 2013).

2.2.3 Definition of Tender Pricing

9

Building construction pricing is very complex. because of the construction industry nature

which was very fragmented and very competitive. Contractors must provide the competitive

bids dealing with risks and uncertainties associated with bidding. A great deal of current

information such as demand, cost, competition, etc. are needed to be forecasted, to enable

bids to be set and adjusted to the required profit levels.

(Shipley's, 1981) showed that the importance of corporate goals in their pricing policies and

tactics, while Davis (1978) stated earlier that the price must be chosen to achieve the

company's goal. So, many pricing objectives have been identified. Assael (1985) determined

three main types of pricing objectives which are as the following:

1. Objectives related to cost

Achieve return on investment, and a specific time period to recover the cost of investment.

2. Objectives related to competition

Taking into consideration market share, discouraging competition and providing a barrier

to entry into other companies.

3. Objectives related to demand

To meet the expectation of the clients.

2.2.4 Definition of Cost Overrun

Cost overruns are defined as an increase in the actual cost over the budget. Cost overruns

are sometimes called "cost escalation", "cost increase" or "budget overrun". Cost overruns

are defined as the change in the amount of the contract divided by the amount of the original

award of the contract (Zhu et al. 2004).

Choudhry (2004) identified cost overruns as the difference between estimation of the

original project's cost, and the actual construction costs when a commercial sector

construction project was completed.

2.2.5 Definition of Project Finance

Wynant (1980) defined the financing of the project as "the financing of a major independent

capital investment separated by the sponsoring company of its assets and liabilities for

general purposes". The World Bank, as one of the key actors in infrastructure projects and

financing in developing countries, defines project financing as "the use of non-resource

financing or microfinance". In addition to the definition of these terms, it is said that project

financing is not a non-payment when lenders pay only the cash flow generated by the project,

in case of total failure, of the value of the project assets. Lenders may also have limited

10

access to the assets of the project sponsor (World Bank, 1994). This definition begins with

project financing characteristics, gives a clear picture of project financing, and it is useful to

clarify the full list of project characteristics and compare project finance with corporate

finance (comer, 1996).

2.2.6 Relationship Between Donors and Owners

Abu Nahla (2008) divided the relationship between NGOs as a representative of the donor

and the Palestinian National Authority as the representative of the owner in three stages.

Phase I: Immediately after the establishment of the PNA, uncertainty about the role that

NGOs should play in the evolving political context is the main feature of this phase.

Phase II: It can be called the stage of accepting the other and initiating a dialogue between

the governmental and non-governmental organizations. In principle, non-governmental

organizations have begun to formulate their own political discourse on civil society,

democracy and the rule of law. Phase III: characterized by the emerging cooperation

between the Legislative Council and the NGO Movement in the drafting and adoption of the

Palestinian NGO Law.

The fundamental problem is that markets and financial institutions operate globally, while

sovereign power is defined at the national level. Financial authorities, such as supervisors,

central banks, decision-makers and ministries of finance, derive their jurisdiction and

powers from national legislation and are therefore based on a national basis. Incompatibility

between global financial actors and national financial authorities creates significant

coordination challenges. The international financial reform agenda contains useful efforts to

strengthen oversight with a substantial increase in capital requirements and new criteria for

decision but has yet to provide (binding) incentives for cooperation between national

authorities.

2.3 Pricing Strategy

Schill (1985) investigated the issues in contract pricing and concluded that the distribution

of risk among contracting parties was the most important key. This growing development

has been recognized as playing a prominent role in pricing construction.

Tellis (1986) defined the pricing strategy as a pre-selection of a set of alternative prices (or

price table) that can aim to maximize profits during a planning period in response to a given

scenario.

11

Flanagan and Norman (1989) Explained that there are a variety of pricing systems used in

the construction industry, which are determined by contract between the client and the

contractor.

Morris and Calantone (1990) Pointed out that pricing strategies could be categorized into:

cost-based pricing, including government-controlled profit prices, and market pricing

including customer-oriented pricing and competitiveness.

Fessler (1990) Stated that large public contractors could only be able to compete using prices

provided by local subcontractors.

2.3.1 Market Based Pricing Strategy

Which is related to the construction company's understanding of the "going price" of the

project given the level of general competition, the current workload, the bid price, etc.

Interest is based on competitive terms to ensure that the price of the company is not far from

those competitors.

2.4 Causes of Cost Overrun

Morris (1990) Examined the factors affecting cost overruns in public sector projects. He

finds that the escalation in costs is due to the fact that the original estimates were prepared

at current prices, partly due to delays that enhance the impact of inflation and to guide the

escalation of costs arising from scale and error and so on, four factors were identified from

the current research results which were: changes in the design, inadequate planning,

unpredictable weather conditions, and fluctuations in the cost of building materials.

Kaming et al., (1997) noted the need to examine and identify the key factors affecting cost

overruns in construction projects and concluded that un expected cost increases, inaccurate

material estimation and project complexity were the main reasons for cost overruns.

Chimwasu (2001) reviewed ten projects to assess their cost performance. The results showed

that seven out of 10 projects reported cost overruns. Factors influencing cost overruns have

been identified and prioritized. These factors have also been categorized according to the

official accounts of the final accounts. By categorizing them into categories, and helping to

deal with them effectively. The four categories reached are differences, measurement of

temporary work, contractual claims and fluctuations in the cost of labor and materials, with

the most significant differences. A list of 18 factors has been prepared in (Chimwasu, 2001)

and has been divided into two groups as follows:

12

Group (A): Critical Factors:

1. The design is not ready at the time of bidding.

2. Additional works requested by the owner.

3. Changes in owner's brief.

4. Lack of planning includes a good cost estimate during the tender preparation.

5. Poor conditions inside the site, whether it is related to soil or other.

6. Adjustment of prime cost and provisional sums.

7. Re measure of provisional works.

8. Logistics due to site location.

9. Lack of cost reports such as cash flow during construction.

Group (B): Other Factors, Which are Usually Ignored:

1. Delay in issuing information to the contractor during the delay.

2. Technical omission in the design stage.

3. Contractual claims, such as extension of time with cost claims.

4. Standard graphics improvements during the construction phase.

5. Frequency by the supervision team in dealing with contractor's queries in delay.

6. Delays in cost changes and additional work.

7. Omission and errors in the invoices of quantities.

8. Ignore items with abnormal rates during evaluation of bids, especially items with

Provisional amounts.

Some tendering tenders by contractors, such as front loading rates.

Iyer et al., (2005) concluded that the most factors affecting the cost overruns of construction

projects are: conflict among project participants, ignorance of project nature, lack of skill

and expertise, and lack of cooperation.

Enshassi et al., (2005) explained that the main factors affecting cost overruns in the Gaza

Strip were: location of the project, fragmentation of the Gaza Strip, reduction of movement

between regions, political situation, and financial position of the owner.

Alhomidan (2015) investigated the top causes of cost overrun at the infrastructure projects

in Saudi Arabia. A list of 41 factors of cost overrun causes was considered. Among these

factors, it was concluded that according to opinions of the responding contractors the top

causes of cost overrun in infrastructure projects in Saudi Arabia are internal administrative

problems, delay of payments, poor communication between construction parties and delays

in decision-making.

13

2.5 Cost Control

Ritz (1994) has developed a cost control system based on several concepts:

1. Create awareness and knowledge of the size of costs during the implementation of

work.

2. Processing accurate data on the cost status, highlighting any unforeseen

circumstances affecting them.

3. Implement a regulatory system that includes several procedures to correct the

problems and provide positive feedback for the continuous evaluation of these areas

of problems.

Ahuja et al., (1994) explained that if the estimate was not linked to the schedule, it would

be added to the project budget, project cost monitoring would not meet the need. The main

objective of cost control is to provide a baseline through which forecasts can be developed.

Wideman (1995) explained that cost control can be achieved by: Controlling project costs

is more important than just getting expenses and reporting, which includes several tasks:

1. Balancing between the project budget and how to spend the money available.

2. Collection of actual costs (including work in progress).

3. Study of cost forecasts.

4. Estimating the costs of the work that has not been completed.

5. Comparing the total estimated cost of the approved budget (including change to

determine the overall budget cost variance, comparing this contrast with the

previously reported variance).

2.6 Cost Estimation

Stewart (1991) defined the cost as the total quantity of all resources required to complete the

activity. However, the price is the total amount paid for this activity.

BMI (2000) defined the cost estimate as involving an approximation of the resource costs

required to complete project activities

Dysert (2006) clarified that the cost estimation is the predictive process used to determine

the cost, and price of resources required through the scope of an investment, activity or

project option.

The cost of construction is defined as the sum of all direct and indirect costs inherent in

converting the material and equipment design plan into a ready-to-start project, but not

necessarily in the production process; total fieldwork, supervision, management, tools, field

office expenses, materials, And subcontractors (AACE International, 2007).

14

2.6.1 The Purpose of Cost Estimation

According to Elhag, et al., (2005) the estimates are prepared and used for different

purposes including feasibility studies, tendering phase, avoidance misuse of funds during

the project, etc. The primary function of cost estimation is to produce an accurate and a

credible cost prediction of a construction project. However, the predicted cost depends

on the requirements of a client and upon the information and data available

(Antohie, 2009) stated that the purpose of an estimate is to postulate the costs required

to complete a project in accordance with the contract plans and specification.

2.6.2 Types of Construction Cost Estimation

Marjuki (2006) classified the types of cost estimates as:

1. Conceptual estimate: Shall be through a cost estimate before processing the design

drawings. The accuracy range of this stage is from -50% to + 100%

2. Preliminary estimate: Well-defined cost data allows the owner pause to review the

design before putting details. The accuracy range at this stage is from -30% to +

50%.

3. Engineers estimate: All plans are ready with design details and help to evaluate the

bid. The accuracy at this stage is from -15% to + 30%.

4. Bid estimate: By the contractor to be used during the tender pricing. The accuracy at

this stage is from -5% to + 15%.

Hendrickson (2008) classified a construction cost estimates into three major parts:

design, bid and control estimates.

1. Design Estimates: The cost estimates encountered are parallel to the planning and

design as follows:

• Sorting estimates (or order of size estimates).

• Preliminary estimates (or conceptual estimates).

• Detailed estimates (or final estimates).

• Engineer estimates based on plans and specifications.

For each of these different estimates, the amount of design information available is

usually increased.

2. Bid Estimates: The tender estimation submitted to the owner consists of direct cost

for construction and field supervision, in addition to markup for overhead and profits.

15

The direct cost of construction for bid estimates is usually derived from a

combination of the following approaches.

• Quantities survey.

• Building procedures.

3. Control Estimates: This is done by:

• Budget estimates for funding.

• Budgeted cost after contracting but before construction.

• Estimated cost of completion during construction progress.

2.6.3 Classification of Construction Cost

2.6.3.1 Material Cost

The cost of the materials includes the direct cost of material, and other costs can be obtained

except of work or equipment for installation. Additional cost items to be considered are;

transportation, sales taxes, shipping and handling costs, warehousing, sales and other losses;

items must be loaded to the work activities including profit (Marjuki, 2006).

Harris and McCaffer (1993), summarized the factors which control the material, they include

the followings:

A. Price variances

1. Inflation.

2. Changes in the buying situation since the preparation of estimate.

B. Quality variances

1. Wastage and breakage.

2. Theft and losses.

3. Shortage in deliveries.

4. Corrective work.

5. Delays in the recording system.

6. Inaccurate site measurement of work done.

2.6.3.2 Labor Cost

Ritz (1994) clarified that the labor cost component in a construction project often ranges

from 30% to 50%, and can be as high as 60% of the overall project cost. It contains direct

and indirect labor cost which vary depending on the extent of their relationship to the

project. Construction work budgets are controlled monthly or weekly. Any error in the

16

original estimate is evaluated by indicating the number of hours required to complete the

work during each reporting period. If abuses begin to emerge early in the reports, the early

investigation of managers in such an indicator is necessary.

Ahuja et al., (1994) stated that in all projects it was necessary to obtain the number of hours

spent by each staff member in each part of the work.

2.6.3.3 Equipment Cost

According to Marjuki (2006), equipment can be classified as the following:

Specific use equipment:

It is used only for specific construction operations and it is removed from the jobsite

soon after the activity is achieved.

General use equipment:

It shared usage by all subcontractors on the construction site and it is not associated

with any particular work item or items.

According to (Ahuja et al., 1994), the cost of the equipment must be charged to the work

item just like labor and material costs. To do so, a record of the number of hours per work

item and the hourly rate per piece of equipment is required. The number of days the

equipment is allocated for a project can be due to check-in and check-out procedures.

Working hours can be collected from equipment time cards.

2.6.3.4 Overhead Cost

Drury (2000) defined the overhead as the construction costs of any kind which cannot be

attributed to any particular item of work. Generally, overhead is an important component of

expenditure and will generally operate from 5% to 15% of the total project costs, depending

to some extent on the costs of some project costs included in the cost estimate.

2.6.3.5 Subcontractors Cost

Mawdesley et al., (1997) stated that the costs of subcontractors are widely used throughout

the construction industry. It's use is very useful for many reasons. However, hiring

subcontractors to carry out his work has many drawbacks. With convincing arguments

against and opposing the use of subcontractors, key contractors will continue to make their

own decisions based on how to balance the arguments against and against. If subcontractors

are used, it is important for the main contractor to plan their work to integrate with all other

17

work on the project. This requires at least some detail to be included in the planning and

control of the main contractor's work.

2.6.3.6 Procurement Cost

Antohie (2009) stated that the procurement cost is particularly important in construction.

Rapid action is required to determine the orders of equipment, materials and subcontractors

within the validity dates on the bids used in the estimate. These purchase orders must be

carefully reviewed for their scope, specifications, delivery and price prior to issuing the

purchase order.

2.7 Elements of Tender Cost

Tender cost includes both direct and indirect costs, this pledge includes profit margin and

contingent liabilities. Thus, the three main elements of the bidding cost are direct costs,

indirect costs and markups (Ritz, 1994).

2.7.1 Direct Cost

Direct costs are those items that actually go into building the facility. An item is considered

a direct cost if it can be linked to a specific item of work on a project. Direct costs make up

the bulk of any construction estimate. The obvious direct costs associated with any project

are:

1. Materials

The term "materials" includes all physical objects that become part of the finished structure.

Thus materials include not only such common and traditional items as soil, concrete, steel,

timber, paving, air ducts and electrical cable, but also various pieces of permanent equipment

such as conveyors, medical diagnostic devices, bank vaults and kitchen stoves and

refrigerators. It should be understood that another element of direct cost, equipment

(sometimes called plant) is used to refer only to construction equipment deployed to install

various elements of the project but not to become part of the completed structure.

2. Labor

There is no doubt that construction is a key activity within any economy; it influences, and

is influenced by, the nation’s gross domestic product (GDP) (Cox et al, 1998, cited in

Enshassi et al., 2007). Predicting labor costs in construction activity may be the most

challenging part of preparing the cost of a tender. Labor costs are variable in nature and

extremely difficult to estimate. Both productivity (the rate at which employees complete

18

work) and the cost per hour to be paid for these staff efforts include many elements.

Productivity varies depending on the size of the staff, availability of materials and

equipment, weather conditions, effectiveness of supervision, and coordination with

concurrent operations at the same location. The cost of work per hour is affected by trade

union agreements and domestic and national legislation that provide for cost elements such

as insurance, training, holidays, sick days, travel and overtime, as well as the regular wage

rate (Olomolaiye et al., 1999).

3. Equipment

According to (Olomolaiye et al., 1999), the construction equipment is used for transporting,

lifting, tying, drilling and compressing various materials installed on the project. For

construction projects, the relative cost of equipment is lower than the cost of highway

projects and other heavy construction projects. Equipment may be owned by the contractor

or may be leased or leased to the project. Contractors lease equipment in the short term,

often months to months. Lease for a period of longer than one year or more, with a common

judgment that the contractor has the option to purchase equipment at the end of the lease

term.

2.7.2 Indirect Cost

Antohie (2009) defined the indirect costs as the expenditures incurred for the management

and delivery of materials, labor, equipment and subcontracts used in any particular function.

They are often referred to as "overhead or general functions". The list of indirect costs for a

given project will vary, but some common items include:

1. Site overheads

It is also called the general cost of field offices. It includes all costs related to project

implementation at the site but not directly related to any specific project. The estimated total

cost of the jobsite would be the basic budget for overhead control at the site. These may

include:

Employee wages and margin benefits.

Employee function expenses related to the project.

External contracted engineering support (surveying, testing of materials, etc.).

General use equipment for the benefit of general contractors and subcontractors.

Field buildings.

Site facilities for the duration of work.

Horizontal structures (roads, parking, fences, gates).

19

Requirements for temporary environmental controls.

Camp facilities for remote jobs.

On-site production facilities (concrete mixing plants, quarries, and various shops).

Protective aids for workers (gloves, hard hats, etc.).

Bonds, insurance, permits and taxes required in the general terms of the contract.

2. Head Office Overhead

General office overhead represents the contractor's fixed expenses. Since the contractor can

have more than one project at a time, the contractor's head office expenses cannot be loaded

most often on a single project. The main office expenses for contractors consist of several

items. The main categories are summarized below:

Staff of the head office.

Benefits.

Office Facilities and Communications.

Office supplies.

Office equipment (leased, if owned for consumption).

Office maintenance.

Advertising / Purchasing Jobs.

Associations and clubs.

Licenses and fees.

Training programs sponsored by the company.

Advisory fees (legal, etc.).

vehicles Main office vehicles, depreciation, operating expenses.

Insurance Expenses.

Total expected home office expenses.

2.8 Finalizing Tender Pricing

The total price of a tender comprises the cost and the markup. The cost includes direct and

indirect costs. The markup, on the other hand, includes profit margin and contingencies, as

shown in Figure (2.1)

20

Figure (2.1): Division of total tender price

They need experience to decide on an appropriate margin to make your bid competitive

with other contractors. The contractor should decide the percentage of the encoding that

makes the bid low enough to win, and at the same time high enough to make a reasonable

profit.

The existence of all contract costs (direct and indirect), components and marks (profit

margin and liabilities), it is time to finalize the bid price. While direct costs are directly

related to contract activities, indirect costs and coding are not associated with specific

activities.

2.8.1 Tender Costing Methodology

According to Alhomidan (2015), the tender costing is the process by which the indirect

costs and markup will be distributed among the items of the bill of quantities, so that

the bid price is ready to be submitted to the client.

2.8.2 Balanced Bid (Straight Forward Method)

The indirect cost and the markup in the balanced bid, will be distributed among different

items based on their direct cost; i.e., the more the direct cost of an item, the more its share

from indirect cost and markup. The resulting bid price is called a balanced bid.

2.8.3 Unbalanced Bid (Loading of Rates)

If the contractor has raised the prices on some tender items and reduced the prices of other

items so that the price of the tender remains as it is. This process is also called load rates.

This is done by the contractor in order to ensure more cash availability at the beginning of

the contract and reduce negative cash flow and thereby reduce borrowing for completion.

Price

cost

Direct cost Indirect cost

Markup

Profit Contingency

21

Loading prices may be risky for both the contractor and the owner. If the contractor raises

the price of the item and the amount of this item exceeds the quantity estimated in the bill

of quantities, this situation is more dangerous to the owner because it will cost the owner

more money. On the other hand, if the contractor cuts the price of a particular item and

increases the amount of that item, the situation will be more serious for the contractor.

22

2.9 Factors for the Questionnaire

Table (2.1): Factors affecting on tender pricing related to the owner

Table (2.2): Factors affecting on tender pricing related to the consultant

.

Factors

Lu

ku

mo

n O

. O

yed

ele,

(20

10

)

En

shas

si,

A., J

.Al-

Naj

jar

(20

09

)

Iyer

K.C

.,

and

Jha,

K.N

.,

(200

5)

Ru

sto

m,

R.,

A

mer

, M

.

(20

02

)

Ham

mad

, S

. (2

013

)

Lie

ntz

, P

. B

enn

et (

20

13

)

Ab

dal

-Had

i, M

., (

201

0)

Elh

ag,

S.,

Bo

uss

abai

ne,

H.

& B

alla

l, A

., (

200

5)

Hin

ze,

J.,

(19

99

)

Liu

, L

. &

Zh

u,

K.,

(20

07

)

Factors affecting on tender pricing related to the owner

The financial performance. √ √ √

The accuracy in evaluating the works which

will be completed. √ √ √

Negative relationships between work parties

and the owner. √ √

Owner's financial reputation. √ √ √

Quality and accuracy of tender documents. √ √

Tender documents contradiction. √ √

Repeated changes which the owner requests. √

Information and data about construction costs. √ √ √ √

The owner's tender awarding method. √ √ √

Time period afforded to fill and award tender. √

Time period to run out the project according to

tender documents. √ √

Factors

Lu

ku

mo

n O

. O

yed

ele,

(20

10

)

En

shas

si,

A., J

.Al-

Naj

jar

(20

09

)

Iyer

K.C

.,

and

Jha,

K.N

.,

(200

5)

Ru

sto

m,

R.,

A

mer

, M

.

(20

02

)

Ham

mad

, S

. (2

013

)

Lie

ntz

, P

. B

enn

et (

20

13

)

Ab

dal

-Had

i, M

., (

201

0)

Elh

ag,

S.,

Bo

uss

abai

ne,

H.

& B

alla

l, A

., (

200

5)

Hin

ze,

J.,

(19

99

)

Liu

, L

. &

Zh

u,

K.,

(20

07

)

Factors affecting on tender pricing related to the consultant

The accuracy of the quantities included in the

Bill of quantities. √ √

Technical skills and management experience

of the consultant team. √ √

Consultant's ability to control quality. √

Quality and accuracy of tender documents. √

The mechanism for carrying out the required

works from the contractor specified by the

consultant.

√ √

Ease of implementation of the designs

proposed by the consultant. √ √

http://www.emeraldinsight.com/author/Oyedele%2C+Lukumon+O


23

Table (2.3): Factors affecting on tender pricing related to the contractor

24

Factors

Lu

ku

mo

n O

. O

yed

ele,

(20

10

)

En

shas

si,

A., J

.Al-

Naj

jar

(20

09

)

Iyer

K.C

.,

and

Jha,

K.N

.,

(200

5)

Ru

sto

m,

R.,

A

mer

, M

.

(20

02

)

Ham

mad

, S

. (2

013

)

Lie

ntz

, P

. B

enn

et (

20

13

)

Ab

dal

-Had

i, M

., (

201

0)

Elh

ag,

S.,

Bo

uss

abai

ne,

H.

& B

alla

l, A

., (

200

5)

Hin

ze,

J.,

(19

99

)

Liu

, L

. &

Zh

u,

K.,

(20

07

)

Factors affecting on tender pricing related to the contractor

Contractor visits to the project site. √ √ √

Study tender documents accurately. √ √ √ √

Follow correct steps in evaluating bids from

subcontractors. √

Contractor's ability to take risk factors during

bid pricing. √ √ √ √

Contractor's ownership of machinery and

equipment.

Maintenance costs of machinery and

equipment. √ √ √

Interest rate because of financial loans. √ √ √ √

Evaluation of works according to the bill of

quantities. √ √

Understand the tender items. √ √

Taking into account the productivity of

workers. √ √

Administrative and technical competence of

the contractor's staff. √

Wages of skilled workers according to work

experience. √ √ √

Coordination between Contractor and

Subcontractors. √ √ √

The relationship between managers and

employees. √ √

Financial Capacity of the Contractor. √ √ √

Contractor performance in previous similar

projects. √ √

The current work size of the contractor at the

time of tender pricing. √ √ √

The number of competitors entering the tender. √ √

The current workload of the bidder. √ √

Availability of other projects in the market. √ √ √

Contractor's execution mechanism (if any). √ √ √

Contractor's ability to control costs. √ √

Granted time to the contractor in pricing. √

Guarantee of the project maintenance period. √ √ √ √

The financial value of the tender. √ √ √

Determine the degree of classification of

companies to enter the tender. √ √ √

Maintain the technical staff, workers and

equipment in the company. √ √ √ √


25

Table (2.4): Factors affecting on tender pricing related to the domor

Table (2.5): Factors affecting on tender pricing related to the market

Factors

Lu

ku

mo

n O

. O

yed

ele,

(20

10

)

En

shas

si,

A., J

.Al-

Naj

jar

(20

09

)

Iyer

K.C

.,

and

Jha,

K.N

.,

(200

5)

Ru

sto

m,

R.,

A

mer

, M

.

(20

02

)

Ham

mad

, S

. (2

013

)

Lie

ntz

, P

. B

enn

et (

20

13

)

Ab

dal

-Had

i, M

., (

201

0)

Elh

ag,

S.,

Bo

uss

abai

ne,

H.

& B

alla

l, A

., (

200

5)

Hin

ze,

J.,

(19

99

)

Liu

, L

. &

Zh

u,

K.,

(20

07

)

Factors affecting on tender pricing related to the donor

Coordination between the owner and the donor

of the project. √ √ √

Requirements of payment guarantee of the

project. √ √ √ √

The financial status of the donor. √ √

The nature of political conditions in the

country. √ √ √

The available fund. √ √ √

Deferred discount of payments to the final

payment. √ √

Factors

Lu

ku

mo

n O

. O

yed

ele,

(20

10

)

En

shas

si,

A., J

.Al-

Naj

jar

(20

09

)

Iyer

K.C

.,

and

Jha,

K.N

.,

(200

5)

Ru

sto

m,

R.,

A

mer

, M

.

(20

02

)

Ham

mad

, S

. (2

013

)

Lie

ntz

, P

. B

enn

et (

20

13

)

Ab

dal

-Had

i, M

., (

201

0)

Elh

ag,

S.,

Bo

uss

abai

ne,

H.

& B

alla

l, A

., (

200

5)

Hin

ze,

J.,

(19

99

)

Liu

, L

. &

Zh

u,

K.,

(20

07

)

Factors affecting on tender pricing related to the market

Updated contractor's information in the local

market. √ √ √

Subcontractors' commitment to the provided

prices to the Contractor. √ √ √ √

Providing experienced and skilled suppliers. √

Contractor's workload during bid pricing

period. √ √

Inflation in raw material prices within the

market. √ √

Materials and equipment size for the projects. √ √

Available other projects in the construction

market. √ √

Change in local and global market conditions. √ √

Considering potential increases in customs

duties and taxes. √ √ √

Currency prices change in the local market.

Status of crossing. √ √ √



26

Table (2.6): Factors affecting on tender pricing related to the project

Factors

Lu

ku

mo

n O

. O

yed

ele,

(20

10

)

En

shas

si,

A., J

.Al-

Naj

jar

(20

09

)

Iyer

K.C

.,

and

Jha,

K.N

.,

(200

5)

Ru

sto

m,

R.,

A

mer

, M

.

(20

02

)

Ham

mad

, S

. (2

013

)

Lie

ntz

, P

. B

enn

et (

20

13

)

Ab

dal

-Had

i, M

., (

201

0)

Elh

ag,

S.,

Bo

uss

abai

ne,

H.

& B

alla

l, A

., (

200

5)

Hin

ze,

J.,

(19

99

)

Liu

, L

. &

Zh

u,

K.,

(20

07

)

Factors affecting on tender pricing related to the project

Project access costs. √ √ √

Meet domestic production of raw materials. √ √ √

Customs duties on imported materials. √ √ √

The nature of the project. √ √

The size of the required equipment and tools in

the site.

√ √ √

Consider changing weather conditions. √ √

Political conditions within the country. √ √ √ √


27

Chapter 3

Research Methodology

28

Chapter 3

Research Methodology

3.1 Introduction

This research has been designed to investigate the factors affecting on bid pricing in

infrastructure construction projects. This chapter discusses the methodology used in this

research. The research methodology was chosen to achieve the research objectives used in

the Gaza Strip, to investigate the factors. The adopted methodology is to complete this

study using the following techniques: research community, questionnaire design, statistical

data analysis, content health and empirical study.

3.2 Research Framework

This means designing a research study that includes the development of a plan or strategy

that will guide data collection and analysis (Polit, D and Hangler, B., 1994). The researcher

designed seven main steps as shown below and are shown in Figure (3.1)

First step: Theme identification (Problem Identification)

Defining the problem, and the objectives of the study then developing the research plan.

Second step: Literature Review

The aim of this step is to make the previous studies about factor affecting on tenderpricing

of infrastructure projects topic was reviewed from various sources such as academic

research journals, Refereed conferences, Dissertations/theses and Websites in order to

fulfill the research objectives.

Third step: Questionnaire Development

The pilot study includes two parts. The first part was undertaken by consulting 5 experts in

construction; academic associated doctors, governmental and international professionals,

and contractors, the second part was accomplished by making analysis trial using some

of the population sample for validation before the main survey.

29

Fourth step: The main survey

In this step of the survey, a quantitative approach was utilized as the main statistical

component in the study, to obtain qualitative data using postal questionnaire. An

extensive sampling strategy will be used to ensure meaningful statistical analysis, which

included distributing the questionnaire to the target groups. In order to obtain reliable and

representative quantitative data, the questionnaires will be distributed to three categories

of community members in different positions and disciplines. construction owners,

construction consultants, construction contractors in an infrastructure sector. Moreover, the

targeted group will be from different education levels, ages and work experience years.

Fifth step: Results and discussion

Data collected will be analyzed using statistical software Statistical Package for Social

Science (SPSS 22).

Sixth step: Conclusion and recommendation

It consists from the conclusions and recommendations.

Seventh step: Documentation

It includes the texting, and grammatical review.

30

Figure (3.1): Framework of the research Methodology

3.3 Research Period

The validity, experimentation and distribution of questionnaires and collection were

completed at the beginning of July 2016.

3.4 Research Location

The research was completed in infrastructure projects in the Gaza Strip

3.5 Research Population and Size

3.5.1 Research population:

The research population will include contractors, consultants, and owners (Ministry of

Housing) from the Gaza Strip, and we select random sample with size 122 engineering

companies.

Sample Size

Topic Selection Identify the

Problem

Define the

Problem

Establish the

Objective

Develop

Research Plan

Questionnaires

Questionnaires Design

Results and Data

Analysis

Conclusion &

Recommendation

Field Surveying

Thesis Proposal

Literature Review

Pilot

Questionnaire

s

Questionnaires

Validity

Questionnaires

Reliability

31

It's a part of population selected to participate in a research study and its size refers to

the number of the elements to be in a study, which can be individuals, groups or

organizations (Zikmund et al, 2009).

Fellows and Liu (1997) said that, having determined the strata, sampling executes generally

by considering the relative significance of every stratum in population and utilizing such

weighting to divide this population.

To determine the sample size; the following statistical formula was utilized:

𝑆𝑆 =𝑍2 ×𝑃 ×( 1−𝑃 )

𝐶2

Where:

SS: The size of sample.

Z: Z value (for example: when confidence interval 95%, Z value =1.96).

P: Percentage picking a choice, expressed as decimal, (0.50 used for sample size needed).

C: Maximum estimation error (0.05).

𝑆𝑆 =(1.96)2 × 0.5 × ( 1 − 0.5 )

(0.05)2= 434

Correction for finite population

𝑆𝑆(𝑛𝑒𝑤) =SS

1 + (SS − 1

Population)

Where the population; in our case was equal to 169 contracting firms and consultants.

𝑆𝑆𝑛𝑒𝑤 =434

1+(433

169)

= 122

The prior calculations presented that the minimum number of the questionnaires required

to be collected is 120 which represent 98% of the target group. We distributed 122

randomly questionnaires

3.6 Questionnaire Content

The questionnaire was provided with an explanatory letter explaining the purpose of the

study, the response and the purpose of research. The questionnaire included a multiple

choice question. The diversity of these questions first aims to achieve the research

32

objectives and gathering all of the necessary data that can support the discussion,

conclusions and recommendations for the research. The sections of the questionnaire are

as follows:

3.6.1 Section One: General Information

1. Company or institution type:

Table (3.1) show that 53.3% from sample's company is "Contracting", 24.2% for

"Consultant", and 22.5% for "Institution".

Table (3.1): Company or institution type

Company type Frequency Percentages

Contracting 64 53.3

Consultant 29 24.2

Institution 27 22.5

Total 120 100.0

2. Respondent's qualification degree:

Table 3.2 show that 2.5% from sample's qualification degree is "Diploma", 60.8 % for

"B.A", 35.0% "M.A", and 1.7% "Ph.D.".

Table (3.2): Respondent's qualification degree

Respondent's qualification degree Frequency Percentages

Diploma 3 2.5

B.A 73 60.8

M.A 42 35.0

Ph.D. 2 1.7

Total 120 100.0

Figure (3.2): Percentages of respondent's due to qualification degree

3. Respondent's job in the company:

33

Table 3.3 show that 32.5% from sample's, Respondent's job in company is "Project

manager", 34.2% "Supervising engineer", 27.5% is for "Technical office engineer",

3.3% is for "Contractor", and 2.5% for "Consultant".

Table (3.3): Respondent's job in the company

Respondent's job in the company Frequency Percentages

Project manager 39 32.5

supervising engineer 41 34.2

technical office engineer 33 27.5

Contractor 4 3.3

Consultant 3 2.5

Total 120 100.0

Figure (3.3): Percentages of respondent's due to respondent's job in the company

4. Respondent's experience years in an infrastructure sector:

Table 3.4 show that 15.8% from sample's, Respondent's experience in an infrastructure

sector is "Less than 5 years", 34.2% is "5- less than 10 years", 16.7 % is 10- 15 years", and

33.3 % is "more than 15 years".

Table (3.4): Respondent's experience years in an infrastructure sector

Respondent's experience years in an infrastructure

sector Frequency Percentages

Less than 5 years 19 15.8

5- less than 10 years 41 34.2

10- 15 years 20 16.7

more than 15 years 40 33.3

Total 120 100.0

34

Figure (3.4): Percentages of respondent's due to respondent's experience years in infrastructure

5. Company's experience years in an infrastructure sector:

Table 3.5 show that 7.5% from the company's experience years in an infrastructure sector

is "Less than 5 years", 27.5% is for "5- less than 10 years", 17.5% is for "10- 15 years",

and 47.5% for "More than 15 years".

Table (3.5): Company's experience years in an infrastructure sector

Company's experience years in an infrastructure Frequency Percentages

Less than 5 years 9 7.5

5- less than 10 years 33 27.5

10- 15 years 21 17.5

More than 15 years 57 47.5

Total 120 100.0

6. The company's recently implemented project cost in U.S dollar:

Table 3.6 show that %64.2 from the company's recently implemented project cost is "less

than 1 Million $", 25.0% is "From 1 to 3 Million $", and 10.8% for "More than 3

Millions$".

Table (3.6): The company's recently implemented project cost

The company's recently implemented project cost in

U.S dollar Frequency Percentages

Less than 1 Million $ 77 64.2

From 1 to 3 Million $ 30 25.0

More than 3 Millions $ 13 10.8

Total 120 100.0

35

Figure (3.5): Percentages of the recently implemented project's cost

7. The financial value of an implemented projects in the last 5 years:

Table 3.7 show that 45.8% from the financial value of an implemented projects in the last

5 years is "Less than 5 Million $", 26.7% for "From 5 to10 Million $", 11.7% for " From

10 to 15 Million $", and 15.8% for "More than 15 Millions $".

Table (3.7): The financial value of an implemented projects in the last 5 years

The financial value of an implemented projects in the

last 5 years Frequency Percentages

Less than 5 Million $ 55 45.8

From 5 to10 Million $ 32 26.7

From 10 to 15 Million $ 14 11.7

More than 15 Million $ 19 15.8

Total 120 100.0

3.6.2 Section Two: Factors Affecting on Tender Pricing Related to the Owner

The main objective of this field is to determine the most important factors that should be

measured to indicate the problem. Respondents asked to give their opinions about the

importance of 11 factors which were taken out from the literature review and piloting study.

3.6.3 Section Three: Factors Affecting on Tender Pricing Related to the Consultant

Respondents asked to give their opinions about the importance of 6 factors which were

taken out from the literature review and piloting study.

3.6.4 Section Four: Factors Affecting on Tender Pricing Related to the Contractor

36



3.6.5 Section Five: Factors Affecting on Tender Pricing Related to the Donor



3.6.6 Section six: Factors Affecting on Tender Pricing Related to the Market



3.6.7 Section seven: Factors Affecting on Tender Pricing Related to the Project


taken out from the literature review and piloting study. All items follows likart scale by

assigning it with a number from 1 to 5 indicating his/her acceptance degree of this item,

where (5) represents the highest acceptance degree about an item and (1) represents the

lowest acceptance degree about it as illustrated in Table (3.8).

Table (3.8): The Likert scale

Level Strongly

disagree Disagree Sometimes Agree

Strongly

agree

Scale 1 2 3 4 5

Weight

mean 20%-36% 36%-52% 52%-68% 68%-84% 84%-100%

3.7 Pilot Study

A pilot study of the questionnaire was conducted before collecting the sample results. This

involves testing the formulations of the questions, identifying the mysterious ones, and

testing the techniques used in collecting the data. The pilot study was divided into three

stages: Phase I: By experts who have more than 15 years' experience in construction

projects and have an academic background in evaluating questionnaires. Phase II: At this

stage, the questionnaire was conducted for a limited group of target population by

appropriately distributing the questionnaire to 12 randomly selected participants and phase

III: At this stage, the questionnaire was analyzed using statistical tests to validate the

questionnaire and reliability, respectively.

37

3.8 Validity of the Research

Determine the validity of the instrument as a determination of the extent to which the

instrument actually reflects the abstract construction being studied. "The validity refers to

the degree to which the instrument measures what is to be measured." The high validity is

the absence of systematic errors in the measuring instrument. When the instrument is valid;

it truly reflects the concept that is supposed to be measured. Achieving good health care

requires research design and sample selection. The revised questionnaire was conducted

by the supervisor and three experts in bidding environments to evaluate the question

procedures and the results analysis method. The experts agreed that the questionnaire was

valid and appropriate enough to measure the purpose of the questionnaire.

3.8.1 Content Validity of the Questionnaire

It was conducted by consulting experts. They were requested to evaluate and identify

whether the questions compatible with the scope of the items and the extent to which these

items reflect the concept of the research problem. They were requested to evaluate if the

instrument was valid statistically or not, and if the questionnaire was designed well enough

to provide the relations and tests between variables. The experts agree with the validity and

suitability of the questionnaire.

3.8.2 Statistical Validity of the Questionnaire

Two statistical tests will be applied here. The first test is the Pearson test, which measures

the correlation coefficient between each element in the field and the entire field. The second

test is the validity test (Pearson test), which was used to test the validity of the questionnaire

structure by testing the validity of each field and the validity of the entire questionnaire. It

measures the correlation coefficient between one filed and all fields of the questionnaire

that have the same level of comparable scale.

3.8.3 Criterion Related Validity

3.8.3.1 Internal Consistency

It is measured by a sample consists of thirty questionnaires, then by measuring the

correlation coefficients between each paragraph in one field and the deposited kidney.

Table (3.9), (3.10) below shows correlation coefficient and p value for each field element.

As shown in the table, the P values are less than 0.05 or 0.01, so the correlation coefficients

in this field are significant at α = 0.01 or α = 0.05, so it can be said that the fields of this

field are consistent and valid.

38

Table (3.9): The correlation coefficient between each paragraph in the field N

o.

p-v

alu

e

Pea

rso

n

coef

fici

ent

No

.

p-v

alu

e

Pea

rso

n

coef

fici

ent

No

.

p-v

alu

e

Pea

rso

n

coef

fici

ent

No. p-

value

Pearson

coefficient

Factors affecting on

tender pricing

related to the owner

Factors affecting on

tender pricing

related to the

consultant

Factors affecting on tender pricing related to the

contractor

1 0.565 0.001 1 0.439 0.015 1 0.814 0.000 15 0.842 0.000

2 0.422 0.020 2 0.751 0.000 2 0.722 0.000 16 0.463 0.010

3 0.838 0.000 3 0.797 0.000 3 0.517 0.003 17 0.603 0.000

4 0.822 0.000 4 0.871 0.000 4 0.909 0.000 18 0.643 0.000

5 0.913 0.000 5 0.873 0.000 5 0.686 0.000 19 0.925 0.000

6 0.927 0.000 6 0.822 0.000 6 0.632 0.000 20 0.969 0.000

7 0.847 0.000

7 0.653 0.000 21 0.834 0.000

8 0.857 0.000 8 0.861 0.000 22 0.691 0.000

9 0.907 0.000 9 0.663 0.000 23 0.672 0.000

10 0.817 0.000 10 0.887 0.000 24 0.708 0.000

11 0.910 0.000 11 0.681 0.000 25 0.724 0.000

12 0.773 0.000 26 0.641 0.000

13 0.483 0.007 27 0.488 0.006

14 0.683 0.000

Table (3.10): The correlation coefficient between each paragraph in the field

3.8.3.2 Structure Validity of the Questionnaire

No.

p-v

alu

e

Pea

rson

coef

fici

ent

No.

p-v

alu

e

Pea

rson

coef

fici

ent

No.

p-v

alu

e

Pea

rson

coef

fici

ent

Factors affecting on tender

pricing related to the donor


pricing related to the market


pricing related to the project

1 0.736 0.000 1 0.646 0.000 1 0.797 0.000

2 0.603 0.000 2 0.713 0.000 2 0.693 0.000

3 0.479 0.007 3 0.803 0.000 3 0.493 0.006

4 0.464 0.010 4 0.714 0.000 4 0.685 0.000

5 0.483 0.007 5 0.712 0.000 5 0.729 0.000

6 0.743 0.000 6 0.765 0.000 6 0.519 0.003

7 0.568 0.001 7 0.529 0.003

8 0.717 0.000

9 0.706 0.000

10 0.554 0.001

11 0.829 0.000

39

The second statistical test was used to test the validity of the questionnaire structure by

testing the validity of each field and the validity of the entire questionnaire. It measures the

correlation coefficient between one filed and all fields of the questionnaire that have the

same level of lira scale.

As shown in Table (3.11), the significance values are less than 0.05 or 0.01, so the

correlation coefficients for all fields are statistically significant at α = 0.01 or α = 0.05, so

the fields are valid for measuring what is in order to achieve the objective of the study.

Table (3.11): Structure validity of the questionnaire

No. Section Pearson correlation

coefficient p-value

1 Factors related to the owner 0.653 0.000

2 Factors related to the consultant 0.671 0.000

3 Factors related to the contractor 0.730 0.000

4 Factors related to the donor 0.737 0.000

5 Factors related to the market 0.645 0.000

6 Factors related to the project 0.785 0.000

3.9 Reliability of the Research

Considered as a degree of consistency that measures the attribute that is supposed to be

measured. Repeat the test for the same sample of people on two occasions and then

compare the results obtained by calculating the reliability factor. For most purposes, the

reliability factor above 0.7 is considered satisfactory. Two to two months are recommended

between two tests given the complex conditions currently faced by contractors. It was very

difficult to ask them to respond to the questionnaire twice in a short time. He explained that

overcoming the distribution of the questionnaire twice to measure reliability can be

achieved using the Cronbach Alpha and half Split Method through the SPSS program.

3.9.1 Split Half Coefficient

Pearson correlation coefficient is found between the means of individual grade questions

and the classification of questions in each of the areas of the questionnaire. Next, Pearson

correlation coefficients can be corrected using the Spearman-Brown correlation coefficient

of correction. Correlation coefficient (consistency coefficient) is calculated according to

the following equation:

Coherence coefficient = 2r / (r + 1), where r is Pearson correlation coefficient. The normal

average correlation coefficient of 2r / (r + 1) is between 0.0 and 1.0. As shown in Table

(3.12), all corrected correlation coefficients range from 0.858 to 0.905 and the general

40

reliability of all items is 0.892 (α) Correlated correlation coefficients are significant at α

<0.05. It can be said that according to the half-split method, the conflict causes a reliable

group.

Table (3.12): Split Half coefficient

Number Section person- correlation Spearman-Brown

Coefficient






6 Factors related to the project 0.794 0.885

All sections 0.805 0.892

3.9.2 Cronbach's Coefficient Alpha:

Measuring the reliability of the questionnaire between each field and the average of the

entire questionnaire domains. The normal value of the alpha value of the Cronbach

coefficient is between 0.0 and 1.0 and the highest values are higher than the internal

consistency. As shown in table 3.13, the Alpha Cronbach coefficient was calculated for the

first area of the claims, the second area of the joint proceedings and the third area of the

special claims. The results were in the range of 0.863 and 0.925 and the overall reliability

of all items is equal to 0.904. This is a high range; the result ensures the reliability of the

questionnaire.

Table (3.13): Cronbach's coefficient alpha

Number Section Cronbach's Alpha

1 Factors related to the owner 0.863

2 Factors related to the consultant 0.889

3 Factors related to the contractor 0.901

4 Factors related to the donor 0.925

5 Factors related to the market 0.896

6 Factors related to the project itself 0.899

All sections 0.904

41

Chapter 4

Results and Discussion

42

Chapter 4

Results and Discussion

4.1 Scope

This chapter analyzes and discusses the results collected from field surveys. Data were

analyzed using SPSS including descriptive statistical instruments. In this study, a total of

122 questionnaires were examined. Which includes personal information and a summary

of respondents, the quantitative analysis of the field survey of the questionnaire and, finally,

the summary framework of the results.

4.2 One -Sample K-S Test for Normality

A single K-S sample test is used to determine whether the data follow normal distribution.

This test is necessary in case test hypotheses since most standard tests provide data to be

normal and distributed. This test is used when the sample size is greater than 50. The test

results As shown in Table 4.1, the calculated p value is greater than the important level of

0.05 (p-value> 0.05), which in turn indicates that the data follows the usual distribution,

and so should be used for border tests.

Table (4.1): One -sample K-S test for normality

43

Number Sub Section Statistic P-value






6 Factors related to the project itself 0.953 0.324

All sections 0.875 0.428

The interviewers were asked to provide their views on the most important factors affecting

the partnership between construction companies in construction projects by 1 to 5, where

"1" represents the least important and "5" the most important. To determine the relative

order of factors, these scores have become important formula-based indicators.

Formula Relative importance Index = N

nnnnn

AN

w

5

12345 12345

Where W is the weighting given to each factor by the respondent, ranging from 1 to 5, (n5

= number of respondents for Big, n4 = number of respondents for Very Big, n3 = number

of respondents for moderate, n2 = number of respondents for weak, n1 = number of

respondents for Not Available). A is the highest weight (i.e. 5 in the study) and N is the

total number of samples. The relative importance index ranges from 0 to 1. Tables below

shows the relative importance index of each clause.

In the following tables one sample t-test was used to test if the opinion of the respondent

in the content of the sentences are positive (% of relative importance index greater than

"60.0%" the p-value less than 0.05, and the value of t test is positive > critical value)

otherwise the opinion of the respondent in the content of the sentences are not positive.

Part 2: Factors Affecting of Cost Estimation of Infrastructure Projects in the Gaza

Strip.

4.3 Research Hypothesis

4.3.1 Hypothesis #1:

Null Hypothesis H0: Factors are not affected positively on tender pricing of an

infrastructure projects in the Gaza Strip at significant level α ≤ 0.05

Alternative Hypothesis H1: Factors are not affected positively on tender pricing of

an infrastructure projects in the Gaza Strip at significant level α ≤ 0.05.

44

And these hypothesis divided into sub- hypothesis as follows:

Hypothesis 1.1:

Null Hypothesis H0: Factors related to the owner is not affected positively on tender

pricing at significant level α ≤ 0.05

Alternative Hypothesis H1: Factors related to the owner affected positively on

tender pricing at significant level α ≤ 0.05.

One sample t test was used for test the opinion of the respondent about each factor of

section one (Factors related to the owner), and the results shown in Table (4.2) As follows:

Table (4.2): RII and P-value for factors related to the owner

No. Factor Mean Std.

Deviation

%of

Relative

importance

Index

t-

value

P-

value Rank

1 The financial

performance 4.18 0.745 83.67 17.410 0.000 1

2

The accuracy in

evaluating the works

which will be

completed

4.13 0.709 82.67 17.504 0.000 2

11

Time period to run out

the project according

to tender documents

4.06 0.853 81.17 13.591 0.000 3

9 The owner tender

awarding method 4.04 0.873 80.83 13.064 0.000 4

5 Quality and accuracy

of tender documents 4.03 0.907 80.67 12.482 0.000 5

4 Owner's financial

reputation 4.00 0.889 80.00 12.325 0.000 6

10 Time period afforded

to fill and award tender 3.83 0.956 76.67 9.553 0.000 7

3

Negative relationships

between work parties

and the owner

3.81 0.964 76.17 9.185 0.000 8

8

Information and data

about construction

costs

3.80 0.885 76.00 9.903 0.000 9

6 Tender documents

contradiction 3.78 1.008 75.50 8.422 0.000 10

7

Repeated changes

which the owner

requests

3.73 0.952 74.50 8.340 0.000 11

Total 3.94 0.507 78.89 20.397 0.000

45

Figure (4.1): RII for the factors related to the owner

The highest two factors according to Relative importance Index are:

1. (The financial performance) with RII = "83.67%", and P-value equal 0.000 <

0.05, The researcher finds that the owner's misunderstanding of the financial

assets management in related to an infrastructure projects leads to a defect in

bid pricing.

2. (The accuracy in evaluating the works which will be completed) with RII =

"82.67%", and P-value equal 0.000 < 0.05.The researcher finds that the owner's

lack of interest in evaluating the mechanisms of implementation of an

infrastructure projects, or the weakness of his experience in evaluating the work

that will be done, affects negatively on the contractor's pricing of the tender.

The lowest three factors according to Relative importance Index are:

1. (Tender documents contradiction) with RII = "75.50%", and P-value equal 0.000

< 0.05.The researcher attributes this to the lack of experience of the owner or any

interest in the preparation and processing of tender documents, but this task will be

left to the consultant.

2. (Repeated changes which the owner requests) with RII = "74.50%", and P-value

equal 0.000 < 0.05.The researcher attributed this to the fact that continuous changes

occur during the implementation of projects, and come at the request of the owner,

commensurate with the success of the project goal.

Hypothesis 1.2:

46

Null Hypothesis H0: Factors related to the consultant are not affected positively on

tender pricing at significant level α ≤ 0.05

Alternative Hypothesis H1: Factors related to the consultant affected positively on


We use a one sample t test for the opinion of the respondent about each factor of

section two (Factors relating to consultant), and the results shown in Table (4.3) As

follows:

Table (4.3): RII and P-value for factors related to the consultant


Deviation

%of

Relative

importance

Index

t-

value

P-

value Rank

1 The accuracy of the

quantities included in

the Bill of quantities

4.32 0.673 86.33 21.418 0.000 1

4 Quality and accuracy

of tender documents 4.08 0.780 81.50 15.105 0.000 2

3 Consultant's ability to

control quality 4.03 0.766 80.67 14.773 0.000 3

2 Technical skills and

management

experience of the

consultant team

4.03 0.727 80.50 15.441 0.000 4

5 The mechanism for

carrying out the

required works from

the contractor

specified by the

consultant

3.98 0.869 79.67 12.389 0.000 5

6 Ease of

implementation of the

designs proposed by

the consultant

3.97 0.755 79.33 14.022 0.000 6

Total 4.07 0.534 81.33 21.889 0.000

47

Figure (4.2): RII for the factors related to the consultant


1. (The accuracy of the quantities included in the Bill of quantities) with RII =

"86.33%", and P-value equal 0.000 < 0.05.The researcher attributes this to the fact that

the consultant does not place the quantities listed in the table of quantities accurately, unlike

the contractor, where the consultant protects himself from the appearance of any additional

works or faults during implementation.

2. (Quality and accuracy of tender documents) with RII = "81.50%", and P-value

equal 0.000 < 0.05.The researcher attributed this to the fact that one of the tasks of the

consultant is to prepare the tender documents with high accuracy and quality. In some

cases, the projects are implemented several years after the preparation of the project

proposal and the preparation of its documents, then the nature of the site has changed.

The lowest three factors according to Relative importance Index are:

1. (The mechanism for carrying out the required works from the contractor specified

by the consultant) with RII = "79.67%", and P-value equal 0.000 < 0.05.The

researcher attributes this to the fact that the mechanism of implementation of the

work is not the responsibility of the consultant, but the competence of the

contractor, and the consultant on the quality of the final output of projects on time.

2. (Ease of implementation of the designs proposed by the consultant) with RII =

"79.33%", and P-value equal 0.000 < 0.05.The researcher believes that this is not

the competence of the consultant, but leaves it to the contractor.

Hypothesis 1.3:

48

Null Hypothesis H0: Factors related to the contractor are not affected positively on


Alternative Hypothesis H1: Factors related to the contractor affected positively on


One sample t test was used to test the opinion of the respondent about each factor

of section three (Factors relating to contractor), and the results shown in Table (4.4)

As follows:

Table (4.4): RII and P-value for factors related to the contractor


Deviation

%of

Relative

importance

Index

t-

value

P-

value Rank

1 Contractor visits to the

project site 4.44 0.708 88.83 22.317 0.000 1

2 Study tender

documents accurately 4.33 0.760 86.67 19.228 0.000 2

3

Follow correct steps in

evaluating bids from

subcontractors

4.12 0.852 82.33 14.359 0.000 3

4

Contractor's ability to

take risk factors during

bid pricing

3.92 0.885 78.33 11.349 0.000 14

5

Contractor's ownership

of machinery and

equipment

3.74 0.992 74.83 8.194 0.000 21

6

Maintenance costs of

machinery and

equipment

3.63 0.869 72.67 7.984 0.000 23

7 Interest rate because of

financial loans 3.68 0.953 73.67 7.859 0.000 22

8

Evaluation of works

according to the bill of

quantities

3.78 0.874 75.50 9.712 0.000 20

9 Understand the tender

items 4.12 0.724 82.33 16.897 0.000 3

10

Taking into account

the productivity of

workers

3.97 0.829 79.33 12.767 0.000 9

11

Administrative and

technical competence

of the contractor's staff

4.05 0.849 81.00 13.554 0.000 5

12

Wages of skilled

workers according to

work experience

4.08 0.866 81.67 13.710 0.000 4

49


Deviation

%of

Relative

importance

Index

t-

value

P-

value Rank

13

Coordination between

Contractor and

Subcontractors

3.80 0.958 76.00 9.148 0.000 19

14

The relationship

between managers and

employees

3.81 0.998 76.17 8.870 0.000 18

15 Financial Capacity of

the Contractor 3.98 0.907 79.67 11.872 0.000 7

16

Contractor

performance in

previous similar

projects

4.03 0.849 80.67 13.326 0.000 6

17

The current work size

of the contractor at the

time of bid pricing

3.84 1.037 76.83 8.890 0.000 17

18

The number of

competitors entering

the tender

3.98 0.772 79.50 13.835 0.000 8

19 The current workload

of the bidder 3.88 0.791 77.67 12.241 0.000 16

20 Availability of other

projects in the market 3.91 0.926 78.17 10.748 0.000 15

21 Contractor's execution

mechanism (if any) 3.88 1.022 77.67 9.465 0.000 16

22 Contractor's ability to

control costs 3.93 0.881 78.50 11.504 0.000 13

23 Granted time to the

contractor in pricing 3.84 1.045 76.83 8.822 0.000 17

24

Guarantee of the

project maintenance

period

3.95 0.829 79.00 12.560 0.000 10

25 The financial value of

the tender 3.93 0.941 78.67 10.860 0.000 12

26

Determine the degree

of classification of

companies to enter the

tender

3.93 0.923 78.67 11.072 0.000 12

27

Maintain the technical

staff, workers and

equipment in the

company

3.94 0.513 78.89 20.163 0.000 11

Total 4.44 0.708 88.83 22.317 0.000


50

1. (Contractor visits to the project site) with RII = "88.83%", and P-value equal 0.000

< 0.05.The researcher attributes this to the fact that the contractor in many

infrastructure projects does not undertake a field visit to the site to be executed. It

depends on his previous experience in how to implement it, knowing that each

project differs from the other in its characteristics, mechanism of implementation

and nature.

2. (Study tender documents accurately) with RII = "86.67%", and P-value equal 0.000

< 0.05. According to the researcher, most of the contractors in Gaza do not study

all the tender documents accurately, due to the limited time period given to the

contractor in the pricing of the tender, which results in errors that may be serious in

pricing, so costs become more than estimated.

The lowest two factors according to Relative importance Index are:

1. (Interest rate because of financial loans) with Relative importance Index "73.67%",

and P-value equal 0.000 < 0.05.The researcher believes that the interest rate does not

cause any problems in the pricing of the tender, but requires the contractor in case of

rising to raise the price of items in order to compensate.

2. (Maintenance costs of machinery and equipment) with Relative importance Index

"72.67%", and P-value equal 0.000 < 0.05. According to the researcher, most of the

contractors in Gaza depend on the subcontractors for the use of machinery and

equipment, and these costs are attributed mainly to the subcontractor, not to the main

contractor.

Hypothesis 1.4:

Null Hypothesis H0: Factors related to the donor are not affected positively on


Alternative Hypothesis H1: Factors related to the donor affected positively on


one sample t test was used to test the opinion of the respondent about each factor of section

four (Factors relating to donor), and the results shown in Table (4.5) As follows:

51

Table (4.5): RII and P-value for factors related to the donor


Deviation

%of

Relative

importance

Index

t-value P-value Rank

1

Coordination

between the

owner and the

donor of the

project

4.17 0.792 83.33 16.134 0.000 1

2

Requirements of

payment

guarantee of the

project

4.10 0.653 82.00 18.443 0.000 2

3

Financial status

of the donor 4.06 0.833 81.17 13.916 0.000 3

4

The nature of

political

conditions in the

country

3.95 0.951 79.00 10.939 0.000 4

5 Available fund 3.85 0.941 77.00 9.898 0.000 5

6

Deferred

discount of

payments to the

final payment

3.85 0.932 77.00 9.994 0.000 5

Total 4.00 0.630 79.92 17.323 0.000

52

Figure (4.3): RII for the factors related to the donor


1. (Coordination between the owner and the donor of the project) with RII=

"83.33%", and P-value equal 0.000 < 0.05.The researcher attributes this to a conflict

of interest between the owner and the financier, and therefore the dissatisfaction of

the financier with the project proposed by the owner. It may often be that the

financier is linked to a certain budget that may not be sufficient to implement the

project proposals submitted by the owner. Financial introduction and

implementation of part of the business.

2. (Requirements of payment guarantee of the project) with RII = "82.00%", and P-

value equal 0.000 < 0.05.The researcher finds that many financiers resort to

delaying the payment of financial payments to the contractor. The contractor is

obliged to raise or reduce the price according to the period in which the transfer of

the contractor's payments is made in any new tenders.


1. (Available fund) with RII = "77.00%", and P-value equal 0.000 < 0.05.The

researcher finds that this is not within the jurisdiction of the contractor. The size of

the available financing is of great concern to the owner in order to verify the

possibility of submitting new tenders for the implementation of the projects, and

the contractor is interested in the financing being available in order to achieve the

desired benefit from the project.

2. (Deferred discount of payments to the final payment) with RII = "77.00%", and P-

value equal 0.000 < 0.05.The researcher believes that this does not affect the pricing

of the tender as a whole, because in the end he will receive the payments at the end

of the project, but may often result in delays in completing the work.

Hypothesis 1.5:

Null Hypothesis H0: Factors related to the market are not affected positively on


Alternative Hypothesis H1: Factors related to the market affected positively on


53

One sample t test was used to test the opinion of the respondent about each factor of section

five (Factors relating to market), and the results shown in Table No. (4.6) As follows:

Table (4.6): RII and P-value for factors related to the market


Deviation

%of

Relative

importance

Index

t-

value

P-

value Rank

11 Status of crossing 4.19 0.990 83.83 13.188 0.000 1

8

Change in local and

global market

conditions

4.12 0.881 82.33 13.884 0.000 2

10

Currency prices

change in the local

market

4.11 0.951 82.17 12.769 0.000 3

5

Inflation in raw

material prices within

the market

3.99 0.939 79.83 11.565 0.000 4

6

Materials and

equipment size for the

projects

3.98 0.809 79.67 13.308 0.000 5

1

Updated contractor's

information in the

local market.

3.95 0.808 79.00 12.879 0.000 6

9

Considering potential

increases in customs

duties and taxes

3.95 0.934 79.00 11.148 0.000 7

4

Contractor's workload

during bid pricing

period

3.88 0.846 77.50 11.333 0.000 8

7

Available other

projects in the

construction market

3.82 0.944 76.33 9.480 0.000 9

3 Providing experienced

and skilled suppliers 3.78 1.073 75.50 7.915 0.000 10

2

Subcontractors'

commitment to the

provided prices to the

Contractor

3.69 0.933 73.83 8.121 0.000 11

Total 3.95 0.588 79.00 17.700 0.000

54

Figure (4.4): RII for the factors related to the market

The highest two factors according to Relative importance Index are

1. (Status of crossing) with RII = "83.83%", and P-value equal 0.000 < 0.05.The

researcher believes that the continuous closures of crossings in the Gaza Strip, lead

to the scarcity of materials or high prices, and this negatively affects the pricing of

the tender.

2. (Change in local and global market conditions) with RII = "82.33%", and P-value

equal 0.000 < 0.05.The researcher attributed this to the fact that the continuous

changes between the period and the other in the prices of materials related to the

local or global market, especially the basic materials such as cement and iron,

negatively affect the pricing of the tender.


1. (Providing experienced and skilled suppliers) with RII = "75.50%", and P-value

equal 0.000 < 0.05.The researcher believes that the availability of experienced

skilled suppliers does not affect the pricing of bids as much as it affects the quality

of the executed works.

2. (Subcontractors' commitment to the provided prices to the Contractor) with RII =

"73.83%", and P-value equal 0.000 < 0.05.The researcher believes that this

negatively affects the pricing of the tender, insofar as it presents the contractor with

risks that are not included in his calculations during the execution of the work on

which the subcontractor is contracted.

Hypothesis 1.6:

Null Hypothesis H0: Factors related to the project are not affected positively on


55

Alternative Hypothesis H1: Factors related to the project affected positively on


We use a one sample t test for the opinion of the respondent about each factor of section

six (Factors relating to project), and the results shown in Table No. (4.7) As follows:

Table (4.7): RII and P-value for factors related to e project


Deviation

%of Relative

importance

Index

t-

value

P-

value Rank

7

Political

conditions within

the country

3.98 0.948 79.50 11.268 0.000 1

3 Customs duties on

imported materials 3.93 0.932 78.67 10.965 0.000 2

1 Project access

costs 3.92 0.846 78.33 11.870 0.000 3

2

Meet domestic

production of raw

materials

3.90 0.938 78.00 10.506 0.000 4

4 The nature of the

project 3.81 0.929 76.17 9.537 0.000 5

5

The size of the

required

equipment and

tools in the site.

3.58 0.875 71.67 7.301 0.000 6

6 Consider changing

weather conditions 3.46 1.044 69.17 4.808 0.000 7

Total 3.80 0.609 75.93 14.330 0.000

56

Figure (4.5): RII for the factors related to the project


1. (Political conditions within the country) with RII = "79.50%", and P-value equal

0.000 < 0.05.The researcher believes that the political situation in the Gaza Strip,

especially after the division in 2007, has deteriorated significantly, leading to the

imposition of a siege on Gaza, the shortage of basic materials available in the

market and the deterioration of the economy of Gaza.

2. (Customs duties on imported materials) with RII ="78.67%", and P-value equal

0.000 < 0.05.The researcher finds that the contractor in Gaza after the events of

division led to an increase in customs duties on materials imported from abroad.

The payment of taxes to the West Bank and Gaza, which led to higher prices, leads

to an increase in pricing errors between the periods.


1. (The size of the required equipment and tools in the site) with Relative importance

Index "71.67%", and P-value equal 0.000 < 0.05.

2. (Consider changing weather conditions) with Relative importance Index

"69.17%", and P-value equal 0.000 < 0.05. The researcher finds that the weather

conditions and their bad affect the price of the tender, which are beyond his control,

but may affect the time period specified for the implementation of the project.

57

Mean Hypothesis

Null Hypothesis H0: Factors not affected positively on the tender pricing of

infrastructure projects in the Gaza Strip at significant level α ≤ 0.05.

Alternative Hypothesis H1: Factors affected positively on the tender pricing of

infrastructure projects in the Gaza Strip at significant level α ≤ 0.05.

Table (4.8) Sorting the factors according to RII from highest to lowest as follows:

1. (Factors related to the consultant) with RII = "81.33%" was the first rank.

2. (Factors related to the donor) with RII = "79.92%"was the second rank.

3. (Factors related to the market) with RII = "79.00%" was the third rank.

4. (Factors relating to the owner) with RII = "78.89%" was the fourth rank.

5. (Factors related to the contractor) with RII = "78.89%" was the fifth rank.

6. (Factors related to the project) with RII = Index "75.93%" was the sixth rank.

Table (4.8): Mean for factors affecting on tender pricing in the Gaza Strip


Deviation

%of Relative

importance

Index

t-

value

P-

value Rank

1 Factors related

to the consultant 4.07 0.534 81.33 21.889 0.000 1

2 Factors related

to the donor 4.00 0.630 79.92 17.323 0.000 2

3 Factors related

to the market 3.95 0.588 79.00 17.700 0.000 3

4 Factors related

to the owner 3.94 0.507 78.89 20.397 0.000 4

5 Factors related

to the contractor 3.94 0.513 78.89 20.163 0.000 5

6 Factors related

to the project 3.80 0.609 75.93 14.330 0.000 6

Total 3.95 0.468 78.91 22.109 0.000

4.3.2 Hypothesis #2:

58

There is no statistically significant differences of the respondents at the level of α ≤ 0.05

about the Factors affecting on tender pricing in the Gaza Strip due to Personal Information:

(company type ,Qualification Degree, Respondent’s job, Respondent’s experience in an

infrastructure sector, Company’s experience years in an infrastructure sector, Last

implemented project’s cost, financial value of an implemented projects in the last 5 years).

And these hypothesis divided into sub- hypothesis as follows:

Hypothesis 2.1:

There were no statistically significant differences among the respondents at 0.05 0.05 on

the factors influencing bid pricing in the Gaza Strip due to the type of company.

To test the hypothesis, we used one-way ANOVA method and the result shown in Table

4.9 showing that the value of p for all factors is 0.000 <0.05 and the value of Fstat = 11.697>

Fcritical = 3.07 means that there were statistically significant differences among the

respondents at α 0.05 0.05 about the factors affecting The pricing of tenders in the Gaza

Strip due to the type of company and the test for the multiple comparison table (4.10) is

the difference between "contracting" and "consulting".

Table (4.9): One-way ANOVA test for differences between the factors due to company type

Field Source Sum of

Squares DF

Mean

Square

F

value

Sig.(P-

Value)

Factors related to the

owner

Between Groups 2.915 2 1.458 6.153

0.003

Within Groups 27.718 117 0.237

Total 30.633 119


consultant

Between Groups 1.172 2 0.586 2.095

0.128


Total 33.911 119


contractor

Between Groups 6.062 2 3.031 14.032

0.000


Total 31.337 119

Factors related to the donor

Between Groups 5.582 2 2.791 7.847

0.001


Total 47.192 119


market

Between Groups 4.283 2 2.142 6.799

0.002


Total 41.138 119


project

Between Groups 6.137 2 3.069 9.456

0.000


Total 44.109 119

All factors Between Groups 4.352 2 2.176 11.697

0.000


59

Field Source Sum of

Squares DF

Mean

Square

F

value

Sig.(P-

Value)

Total 26.117 119

Table (4.10): Scheffe test for multiple comparison due to company type

Mean difference Contracting

Consulting Officer

Contracting 0.468* -0.144

Consulting -0.468* -0.612*

Officer 0.144 0.612*

Hypothesis 2.2:

There were no statistically significant differences among the respondents at α 0.05 0.05 on

the factors affecting the pricing of tenders in the Gaza Strip due to the degree of scientific

qualification. In order to test the hypothesis, we used one way ANOVA and the result

shown in Table 4.11 indicating that the value of p for all factors is 0.576> 0.05, and the

value of Fstat = 0.663 <Fcritical = 2.68 which means that there were no statistically

significant differences between the respondents at α 0.05 on the factors affecting the pricing

of tenders in the Gaza Strip because of the degree of scientific qualification.

Table (4.11): One-way ANOVA test for differences between the Factors due to Qualification Degree

Field Source Sum of

Squares DF

Mean

Square

F

value

Sig.(P-

Value)

Factors related to the owner

Between Groups 0.376 3 0.125 0.481

0.696


Total 30.633 119


consultant

Between Groups 1.803 3 0.601 2.171

0.095


Total 33.911 119


contractor

Between Groups 0.332 3 0.111 0.414

0.743


Total 31.337 119


Between Groups 1.547 3 0.516 1.310

0.275


Total 47.192 119

Factors related to the market

Between Groups 0.643 3 0.214 0.614

0.607


Total 41.138 119

60

Field Source Sum of

Squares DF

Mean

Square

F

value

Sig.(P-

Value)

Factors related to the project

itself

Between Groups 0.975 3 0.325 0.874

0.457


Total 44.109 119

All factors

Between Groups 0.440 3 0.147 0.663

0.576


Total 26.117 119

Hypothesis 2.3:

There were no statistically significant differences among the respondents at α = 0.05 on the

factors influencing bid pricing in the Gaza Strip due to the respondent's work in the

company. To test the hypothesis we use one way ANOVA and the result shown in Table

4.12 showing that the value of p for all factors is 0.000 <0.05, and the value of Fstat =

7.386> Fractical = 2.45. There were statistically significant differences between the

respondents at α 0.05 0.05 on the factors affecting bid pricing in the Gaza Strip due to the

respondent's work in the company. The difference between the "consultant" and the

"project manager".

Table (4.12): One-way ANOVA test for differences between the Factors due to Respondent’s job in the

company

Field Source Sum of

Squares DF

Mean

Square

F

value

Sig.(P-

Value)


Between

Groups 2.681 4 0.670

2.758

0.031


Total 30.633 119


consultant

Between

Groups 2.051 4 0.513

1.850

0.124


Total 33.911 119


contractor

Between

Groups 5.518 4 1.380

6.145

0.000


Total 31.337 119


Between

Groups 10.340 4 2.585

8.067

0.000


Total 47.192 119

Factors related to the market Between

Groups 9.159 4 2.290

8.234

0.000

61

Field Source Sum of

Squares DF

Mean

Square

F

value

Sig.(P-

Value)


Total 41.138 119


Between

Groups 8.925 4 2.231

7.293

0.000


Total 44.109 119

All factors

Between

Groups 5.338 4 1.335

7.386

0.000


Total 26.117 119

Table (4.13): Scheffe test for multiple comparison due to Respondent’s job in the company

Mean difference Project

manager

Supervising

engineer

Technical

office

engineer

Contractor Consultant

Project manager -0.024 0.014 0.140 1.337*

Supervising

engineer 0.024 0.038 0.164 1.361*

Technical office

engineer -0.014 -0.038 0.126 1.323*

Contractor -0.140 -0.164 -0.126 1.197*

Consultant -1.337* -1.361* -1.323* -1.197*

Hypothesis 2.4:


the factors affecting bid pricing in the Gaza Strip due to the respondent's experience in the

infrastructure sector. To test the hypothesis we use one-way ANOVA method and the result

is shown in Table 4.14 which shows that the value of p for all factors is 0.642> 0.05, and

the value of Fstat = 0.561 <Fcritical = 2.68. There were no statistically significant

differences between the respondents at α 0.05 0.05 on the factors influencing bid pricing

in the Gaza Strip due to the experience of the respondent in the infrastructure sector.

Table (4.14): One-way ANOVA test for differences between the Factors due to respondent’s experience in

Infrastructure sector

Field Source Sum of

Squares DF

Mean

Square

F

value

Sig.(P-

Value)


Between Groups 0.720 3 0.240 0.931

0.428


Total 30.633 119

62


consultant

Between Groups 0.690 3 0.230 0.803

0.495


Total 33.911 119


contractor

Between Groups 0.366 3 0.122 0.457

0.713


Total 31.337 119


Between Groups 0.492 3 0.164 0.407

0.748


Total 47.192 119


Between Groups 0.578 3 0.193 0.551

0.648


Total 41.138 119


Between Groups 0.112 3 0.037 0.099

0.961


Total 44.109 119

All factors

Between Groups 0.374 3 0.125 0.561

0.642


Total 26.117 119

Hypothesis 2.5:


the factors affecting the pricing of tenders in the Gaza Strip due to the number of experience

years in infrastructure sector. To test the hypothesis we used one-way ANOVA method

and the result shown in Table 4.15 showing that the value of p for all factors is 0.247> 0.05,

and the value of Fstat = 1.397 <Fcritical = 2.68. Which means that there are no statistically

significant differences among respondents at α 0.05 0.05 on the factors influencing bid

pricing in the Gaza Strip due to years of experience in the infrastructure sector.

Table (4.15): One-way ANOVA test for differences between the Factors due to company’s experience

years in an infrastructure sector

Field Source Sum of

Squares DF

Mean

Square

F

value

Sig.(P-

Value)


Between Groups 1.563 3 0.521 2.079

0.107


Total 30.633 119


consultant

Between Groups 0.657 3 0.219 0.764

0.516


Total 33.911 119


contractor

Between Groups 1.760 3 0.587 2.301

0.081


Total 31.337 119


Between Groups 1.290 3 0.430 1.087

0.358


Total 47.192 119

Factors related to the market Between Groups 0.272 3 0.091 0.258

0.856


63

Field Source Sum of

Squares DF

Mean

Square

F

value

Sig.(P-

Value)

Total 41.138 119


Between Groups 0.237 3 0.079 0.209

0.890


Total 44.109 119

All factors

Between Groups 0.911 3 0.304 1.397

0.247


Total 26.117 119

Hypothesis 2.6:

There were no statistically significant differences among the respondents at α 0.05 on the

factors affecting the pricing of tenders in the Gaza Strip due to the final cost of the project.

To test the hypothesis, we used one-way ANOVA method and the result shown in Table

4.17 indicating that the value of p for all factors is 0.051> 0.05 and the value of Fstat =

3.010 <Fcritical = 3.07 which means that there were no statistically significant differences

between the respondents at α 0.05 Factors Affecting Bidding Pricing in the Gaza Strip due

to the final cost of the Project.

Table (4.16):One-way ANOVA test for differences between the Factors due to the last implemented

project’s cost.

Field Source Sum of

Squares DF

Mean

Square

F

value

Sig.(P-

Value)


Between Groups 0.310 2 0.155 0.599

0.551


Total 30.633 119


consultant

Between Groups 0.533 2 0.267 0.935

0.396


Total 33.911 119


contractor

Between Groups 1.338 2 0.669 2.610

0.078


Total 31.337 119


Between Groups 5.917 2 2.959 8.387

0.000


Total 47.192 119


Between Groups 2.212 2 1.106 3.325

0.039


Total 41.138 119

Factors related to the project Between Groups 3.285 2 1.643 4.708

0.011


64

Total 44.109 119

All factors

Between Groups 1.315 2 0.658 3.010

0.051


Total 26.117 119

Hypothesis 2.7:

There were no statistically significant differences among the respondents at α 0.05 on the

factors affecting bid pricing in the Gaza Strip due to the financial value of the executed

project in the last five years.

In order to test the hypothesis, we use the one-way ANOVA and the result shown in Table

4.18, showing that the value of p for all factors is 0.184> 0.05, and the value of the Fstat =

1.641 <Fcritical = 2.68. Which means that there are no statistically significant differences

between the respondents at α 0.05 on the factors affecting the pricing of tenders in the Gaza

Strip due to the financial value of the projects implemented during the past five years.

Table (4.17): One-way ANOVA test for differences between the Factors due to the financial value of the

implemented projects in the last five years.

Field Source Sum of

Squares DF

Mean

Square

F

value

Sig.(P-

Value)

Factors relating to owners

Between Groups 2.547 3 0.849 3.506

0.018


Total 30.633 119


consultant

Between Groups 1.458 3 0.486 1.737

0.163


Total 33.911 119


contractor

Between Groups 0.979 3 0.326 1.247

0.296


Total 31.337 119


Between Groups 2.877 3 0.959 2.510

0.062


Total 47.192 119


Between Groups 1.774 3 0.591 1.743

0.162


Total 41.138 119


itself

Between Groups 1.200 3 0.400 1.081

0.360


Total 44.109 119

All factors

Between Groups 1.063 3 0.354 1.641

0.184


Total 26.117 119

65

Chapter 5

66

Conclusions and

Recommendations

Chapter 5

Conclusions and Recommendations

5.1 Introduction

This chapter summarizes the research results and provides recommendations and

conclusions for the factors that affecting on tender pricing in an infrastructure projects in

the Gaza Strip. Research contribution and suggested areas of another researches were

discussed in this chapter. By revising the research objectives and findings. In achieving

the aim of the research, two main objectives have been outlined and achieved through

the findings of the analyzed collected questionnaires. These objectives are related with the

research questions that were developed to increase one’s knowledge and familiarity with

the subject. The outcomes were found as followings:

5.2 Outcomes Related to Objective One: identification the factors affecting on tender

pricing in the Gaza Strip.

67

The basic objective of the research is to determine the most important factors that

should be measured to indicate the problem. Respondents asked to give their opinions

about the importance of 61 factors taken from the literature review and piloting study.

5.2.1 Findings About the Factors Affecting on Tender Pricing Related to the Owner

We reject the Null hypothesis that there is no significant difference at level (α ≤ 0.05) in

respondents evaluations for CFs related to the owner which affected on tender pricing in

the Gaza Strip, and accept the Alternative hypothesis.

Generally, the results for all factors affecting on tender pricing related to the owner show

that the average mean equal (3.94), RII equal 78.89% > 60%, and the value of t-test equal

20.397> critical value=1.98, and the p-value equal zero < 0.05.

The highest two factors where:

1. "The financial performance", with RII equal to (83.67%), and P-value equal to

0.000 < 0.05, The researcher finds that the owner's misunderstanding of the

financial assets management in related to an infrastructure projects leads to a defect

in bid pricing.

2. "The accuracy in evaluating the works which will be completed", with RII equal to

(82.67%), and P-value equal 0.000 < 0.05, The researcher finds that the owner's

lack of interest in evaluating the mechanisms of implementation of an infrastructure

projects, or the weakness of his experience in evaluating the work that will be done,

affects negatively on the contractor's pricing of the tender.

The lowest two factors where:

1. "Tender documents contradiction", with RII equal to (75.50%), and P-value equal

0.000 < 0.05, The researcher attributes this to the lack of experience of the owner

or any interest in the preparation and processing of tender documents, but this task

will be left to the consultant.

2. "Repeated changes which the owner requests", with RII equal to (74.50%), and P-

value equal 0.000 < 0.05, The researcher attributed this to the fact that continuous

changes occur during the implementation of projects, and come at the request of the

owner, commensurate with the success of the project goal.

5.2.2 Findings About the Factors Affecting on Tender Pricing Related to the

Consultant

68


respondents evaluations for CFs related to the consultant which affected on tender pricing

in the Gaza Strip, and we accept the Alternative hypothesis.


that the average mean equal (4.07), Relative importance Index equal 81.33%> 60%, and

the value of t-test equal 21.889> critical value=1.98, and the p-value equal zero < 0.05.


1. "The accuracy of the quantities included in the Bill of quantities", with RII equal to

(86.33%), and P-value equal to 0.000 < 0.05, The researcher attributes this to the

fact that the consultant does not place the quantities listed in the table of quantities

accurately, unlike the contractor, where the consultant protects himself from the

appearance of any additional works or faults during implementation.

2. "Quality and accuracy of tender documents", with RII equal to (81.50%), and P-

value equal 0.000 < 0.05, The researcher attributed this to the fact that one of the

tasks of the consultant is to prepare the tender documents with high accuracy and

quality. In some cases, the projects are implemented several years after the

preparation of the project proposal and the preparation of its documents, then the

nature of the site has changed.


1. "The mechanism for carrying out the required works from the contractor specified

by the consultant", with RII equal to (79.67%), and P-value equal 0.000 < 0.05,

The researcher attributes this to the fact that the mechanism of implementation of

the work is not the responsibility of the consultant, but the competence of the

contractor, and the consultant on the quality of the final output of projects on time.

2. "Ease of implementation of the designs proposed by the consultant", with RII equal

to (79.33%), and P-value equal 0.000 < 0.05, The researcher believes that this is

not the competence of the consultant, but leaves it to the contractor.

5.2.3 Findings About the Factors Affecting on Tender Pricing Related to the

Contractor


respondents evaluations for CFs related to the contractor which affected on tender pricing

in the Gaza Strip, and we accept the Alternative hypothesis.

69





1. "Contractor visits to the project site", with RII equal to (88.33%), and P-value equal

to 0.000 < 0.05, The researcher attributes this to the fact that the contractor in many

infrastructure projects does not undertake a field visit to the site to be executed. It

depends on his previous experience in how to implement it, knowing that each

project differs from the other in its characteristics, mechanism of implementation

and nature.

2. "Study tender documents accurately", with RII equal to (86.67%), and P-value

equal 0.000 < 0.05, According to the researcher, most of the contractors in Gaza do

not study all the tender documents accurately, due to the limited time period given

to the contractor in the pricing of the tender, which results in errors that may be

serious in pricing, so costs become more than estimated.


1. "Interest rate because of financial loans", with RII equal to (73.67%), and P-value

equal 0.000 < 0.05, The researcher believes that the interest rate does not cause

any problems in the pricing of the tender, but requires the contractor in case of

rising to raise the price of items in order to compensate.

2. "Maintenance costs of machinery and equipment", with RII equal to (72.67%), and

P-value equal 0.000 < 0.05, According to the researcher, most of the contractors in

Gaza depend on the subcontractors for the use of machinery and equipment, and

these costs are attributed mainly to the subcontractor, not to the main contractor.

5.2.4 Findings About the Factors Affecting on Tender Pricing Related to the Donor


respondents evaluations for CFs related to the donor which affected on tender pricing in

the Gaza Strip, and we accept the Alternative hypothesis.





70

1. "Coordination between the owner and the donor of the project", with RII equal to

(83.33%), and P-value equal to 0.000 < 0.05, The researcher attributes this to a

conflict of interest between the owner and the financier, and therefore the

dissatisfaction of the financier with the project proposed by the owner. It may often

be that the financier is linked to a certain budget that may not be sufficient to

implement the project proposals submitted by the owner. Financial introduction and

implementation of part of the business.

2. "Requirements of payment guarantee of the project ", with RII equal to (82.00%),

and P-value equal 0.000 < 0.05, The researcher finds that many financiers resort to

delaying the payment of financial payments to the contractor. The contractor is

obliged to raise or reduce the price according to the period in which the transfer of

the contractor's payments is made in any new tenders.


1. "The available fund", with RII equal to (77.00%), and P-value equal 0.000 < 0.05,

The researcher finds that this is not within the jurisdiction of the contractor. The

size of the available financing is of great concern to the owner in order to verify the

possibility of submitting new tenders for the implementation of the projects, and

the contractor is interested in the financing being available in order to achieve the

desired benefit from the project.

2. "Deferred discount of payments to the final payment", with RII equal to (77.00%),

and P-value equal 0.000 < 0.05, The researcher believes that this does not affect

the pricing of the tender as a whole, because in the end he will receive the payments

at the end of the project, but may often result in delays in completing the work.

5.2.5 Findings About the Factors Affecting on Tender Pricing Related to the Market


respondents evaluations for CFs related to the market which affected on tender pricing in





71


1. "Status of crossing", with RII equal to (83.83%), and P-value equal to 0.000 < 0.05,

The researcher believes that the continuous closures of crossings in the Gaza Strip,

lead to the scarcity of materials or high prices, and this negatively affects the pricing

of the tender.

2. "Change in local and global market conditions", with RII equal to (82.17%), and

P-value equal 0.000 < 0.05, The researcher attributed this to the fact that the

continuous changes between the period and the other in the prices of materials

related to the local or global market, especially the basic materials such as cement

and iron, negatively affect the pricing of the tender.


1. "Providing experienced and skilled suppliers", with RII equal to (75.50%), and P-

value equal 0.000 < 0.05, The researcher believes that the availability of

experienced skilled suppliers does not affect the pricing of bids as much as it affects

the quality of the executed works.

2. "Subcontractors' commitment to the provided prices to the Contractor", with RII

equal to (73.83%), and P-value equal 0.000 < 0.05, The researcher believes that

this does not affect the pricing of the tender as a whole, because in the end he will

receive the payments at the end of the project, but may often result in delays in

completing the work.

5.2.6 Findings About the Factors Affecting on Tender Pricing Related to the Project


respondents evaluations for CFs related to the project which affected on tender pricing in






1. "Political conditions within the country", with RII equal to (79.50%), and P-value

equal to 0.000 < 0.05, The researcher believes that the political situation in the Gaza

Strip, especially after the division in 2007, has deteriorated significantly, leading to

72

the imposition of a siege on Gaza, the shortage of basic materials available in the

market and the deterioration of the economy of Gaza.

2. "Customs duties on imported materials", with RII equal to (78.67%), and P-value

equal 0.000 < 0.05, The researcher finds that the contractor in Gaza after the events

of division led to an increase in customs duties on materials imported from abroad.

The payment of taxes to the West Bank and Gaza, which led to higher prices, leads

to an increase in pricing errors between the period.


1. "The nature of the project", with RII equal to (76.17%), and P-value equal 0.000

< 0.05, The researcher believes that most of the infrastructure projects in the Gaza

Strip are clear objectives and implementation policy, and small size.

2. "Consider changing weather conditions", with RII equal to (69.17%), and P-value

equal 0.000 < 0.05, The researcher finds that the weather conditions and their bad

affect the price of the tender, which are beyond his control, but may affect the time

period specified for the implementation of the project.

5.3 Recommendations

5.3.1 Recommendations For the Contractors in the Gaza strip

The contractor should do as the following:

1. Be aware of the conditions of the project site, and the nature and nature of the soil,

taking into account the different nature of the land from one location to another,

knowing that the rocky land requires a high cost and a longer period of time to

complete the work.

2. Accurate review of the contract terms and the executive regulations as they are

binding materials to the contractor, which may bear the contractor additional costs

such as insurance and social insurance.

3. Review tender documents carefully and review all general and special conditions

as well as review the specifications of the work for each item.

73

4. Review the Bills of quantities accurately and match them with plans to ensure that

all works covered by the drawings have items in the bill of quantities.

5. Familiarity with prices of raw materials used according to the approval of the owner

of the project.

6. Familiarity with the manufacturing facilities and productivity of workers for each

item.

7. Inventory of works loaded on the project items and added cost to the overall project

costs.

8. Considering the change in the prices of raw materials, especially iron, cement, base

course and Kurkar, as there is a change in prices constantly and update costs

according to the prices of raw materials mentioned.

9. The contractor shall undertake field visits to the project site in order to know the

roads leading to the project, and provide the necessary services for implementation

such as water, electricity, communications and others.

10. Dependence on the specialized agencies in the pricing of some of the work that

require price quotes from specialized sources to determine the actual cost before

setting prices.

11. Determine the administrative expenses that include salaries, wages and other costs

related to the project in general to add to the costs of materials and manufactures.

12. To take into account the balance of the prices for items so that the profit margin is

achieved in all items in a balanced manner.

13. Knowledge of the prices of subcontractors.

5.3.2 Recommendations For the Consultants and Owners in the Gaza strip

Construction projects, regardless of their nature or size, may start with an idea or need..

Suggesting the paving of a particular road to the people's need and importance. The owner

may perform one or several activities at this stage or may be assigned to specialized

engineering companies for the design and study (feasibility, finance, budget, site analysis,

environmental impact study). Feasibility studies help landlord to identify prevailing

conditions, and special needs.

The consultant reviews and evaluates the owner's program and budget and discusses

various design and implementation options based on that data. As agreed, the consultant

prepares preliminary designs. These designs can include small schemes, interfaces, and

74

many other documents that generally describe business, between parts of a project and a

general description of the type of construction and equipment proposed. In addition to the

above, there are some documents that contain a description of the basic project, as well as

initial cost of the project and general frameworks for the specifications of the materials that

will be used to estimate the preparation.

After the owner's approval of the preliminary designs and any necessary modifications to

the work program or budget, the relationship becomes more general and detailed.

Summarizing an accurate description of the nature and size of the project, including its

structural, architectural, and electrical components through drawings, details, sections,

tables and curves. The preliminary specifications of the project are developed and cost

estimation is developed more accurately.

5.3.3 Recommendations During the Preparation of Tender Documents

The approval shall be based on the owner's approval of the previous amendments and any

amendments proposed by him, both in terms of technical aspects or budget. During this

phase, the consultant shall prepare the documents to be used for the submission of the

request or to call for proposals. Tender documents shall be made up of contract documents,

such as plans, specifications, models and general and special conditions. All these

documents become part of the legal contract signed between the owner and the contractor.

5.4 Recommendations for Further Research

After a completion of the research within the research objectives, and scope, it observed

that some issues have not been covered by this research, further researches might be

conducted such as analyzing and introducing methods to estimate the actual cost of an

infrastructure projects, using case studies. This study can be used to design the case

studies by considering the factors which mentioned in. Further studies can use other

population such as contracting firms work in building construction in order to have

integrated view of their interests in this subject.

75

References

76

References

AACE International, (2007) "Cost engineering terminology, recommended practice.", 2nd

Edition, AACE International, Morgantown WV, pp. 221-228.

Abdal-Hadi, M., (2010) "Factors Affecting Accuracy of Pre-tender Cost Estimate in Gaza

Strip", The Islamic University of Gaza, Palestine, pp. 26-27, Unpublished Msc. Thesis.

Abu Nahla H. (2008) "Role of Palestinian NGOS in utilizing international fund to promote

entrepreneurs and create sustainable job opportunities", Case study: Gaza Strip,

Islamic University of Gaza, Palestine, Unpublished Msc. Thesis.

Ahuja, H., N. and S., P., Dozzi, (1994) "Project management techniques in planning and

controlling construction projects", Second Edition, John Wiley& Sons Inc., New York.

pp.183-188.

Assael, H., )1985) "Marketing Management: Strategy and Action", Kent Publishing,

Boston University, United States Of America, pp.144-149.

Choudhury, I. and Phatak, O., (2004) "Correlates of time overrun in commercial

construction", ASC proceeding of 4th Annual Conference, Brigham Young University.

Construction Industry Institute, (1988) "Project materials management primer",

publication 7-2, Bureau of Engineering Research, The University of Texas at Austin.

Daniel, Wayne W. (1990) "Kolmogorov Smirnov one-sample test". Applied Nonparametric

Statistics (2nd ed.). Boston: PWS-Kent. pp. 319-330

Davis, J.R., (1978) "Determining the 'Plus' in cost-plus pricing", Management Accounting,

May, pp. 198-201.

https://books.google.com/books?id=0hPvAAAAMAAJ&pg=PA319

77

Dmaidi, N. Dwaikat, M. and Shweiki I. (2013) "Construction Contracting Management

Obstacles in Palestine", Nablus, Palestine, International Journal of Construction

Engineering and Management 2(1), 15-22

Dominick, P. Lechler, T. & Aronson, Z. (2004) "Project Characteristics and Project

Leadership" Understanding Sources of Uncertainty in Project-Based Work, Current Issues

in Technology Management, 3(8), 1-3

Dysert, L. R., (2006) "Is estimate accuracy an oxymoron?", AACE International

Transactions, s.l.: EST01.1 - 01.5.

Eisinga, R.; Te Grotenhuis, M.; Pelzer, B. (2012) "The reliability of a two-item scale:

Pearson, Cronbach or Spearman-Brown?", International Journal of Public Health. 58 (4),

637–642.

Elhag, S., Boussabaine, H. & Ballal, A., (2005) "Critical determinants of construction

tendering costs: quantity surveyors standpoint", International Journal of Project

Management, 23(7), pp. 538–545.

Enshassi, A., J.Al-Najjar and M.Kumaraswamy, (2009) "Delays and cost overruns in the

construction projects in the Gaza Strip", Financial management, Property Construction.

European directives, (2004)"Directive of the european parliament and of the council",

official journal of the european union.

Feng,W., Zhu, W. & Zhou, Y., (2010) "The Application of Genetic Algorithm and Neural

Network in Construction Cost Estimate", Guangzhou, P. R. China, Guangzhou, pp.

151-155.

FIDIC, (1987) "Conditions of contract for works of Civil Engineering construction".

Flyvbjerg, B., Holm, M. K. S., & Buhl, S. L. (2004) "Cost underestimation in public works

projects: Error or lie" Journal of the American Planning Association, 68(3).

Flyvbjerg, B., Holm, M. K. S., & Buhl, S. L. (2004) "What causes cost overrun in transport

infrastructure projects" Transport Reviews, 24(1).

Gelman, Andrew (2008) "Variance, analysis of the new Palgrave dictionary of

economics", (2nd ed.). Basingstoke, Hampshire New York: Palgrave Macmillan.

Good, P. Permutation Tests (2000) "A Practical Guide to Resampling Methods for Testing

Hypotheses", (2nd ed.), New York: Springer-Verlag.

Hammad, S. (2013) "Investigating the stakeholder management in construction projects

in the Gaza Strip", M.S.c. Thesis, Islamic University of Gaza, Palestine.

Hinze, J., (1999) "Construction Planning and Scheduling" Columbus, Ohio: Prentice Hall.

International Society of Parametric Analysts, (2008) "Parametric estimating Handbook",

4th ed. Vienna: US government.

http://www.amazon.com/exec/obidos/ASIN/038798898X/ref=nosim/ericstreasuretro

http://www.amazon.com/exec/obidos/ASIN/038798898X/ref=nosim/ericstreasuretro

78

Islam, S., Zhou, L. & Li, F., (2009) "Application of Artificial Intelligence (Artificial

Neural Network) to Assess Credit Risk", A Predictive Model For Credit Card Scoring,

Karlskrona, Sweden: Blekinge Institute of Technology.

Iyer K.C., and Jha, K.N., (2005) "Factors affecting cost performance: Evidence from

Indian construction projects", International Journal of Project Management, pp. 283-295.

Kim, G.-H., An, S.-H. & Kang, K.-I., (2004) "Comparison of construction cost

estimating models based on regression analysis, neural networks, and case-based

reasoning. Building and Environment", pp. 1235 – 1242.

Leng, K. C., (2005) "Principles of knowledge transfer in cost estimating conceptual

model", Malaysia, University Teknologi.

Lientz, P. Bennet (2013) "Project Management", UK, Palgrave Macmilan, pp119.

Liu, L. & Zhu, K., (2007) "Improving cost estimates of construction projects using phased

cost factors", Journal of Construction Engineering and Management, 133(1), pp. 91-95.

Lukumon O. Oyedele, (2010) "Sustaining architects' and engineer's motivation in design

firms: An investigation of critical success factors", Engineering Construction and

Architectural Management, 17 (2), pp.180-196.

Mahamid, I. & Bruland, A., (2010) "Preliminary Cost Estimating models for Road

Construction Activities in Development", C.I., ed. Facing the Challenges – Building the

Capacity. Sydney, Australia, 2010.

Marjuki, M., (2006) "Computerized building cost estimating system", Malaysia:

University Teknologi.

McCaffer, R. & Baldwin, A. N., (1991) "Estimating and Tendering for Civil

Engineering Works", 2nd ed. Oxford: BSP Professional Books.

Mohamed Yamin, Adriel K.S. Sim, (2016) "Critical success factors for international

development projects in Maldives: Project teams’ perspective", International Journal of

Managing Projects in Business, 9(3), pp.481 504.

Newton, Richard (2006) "Project Management, Step By Step, How to Plan & Manage

Highly Successful Project", Copyright Licensing Agency Ltd, Britain,

Olomolaiye, P., Jayawardane, A., Harris. F. (1998) "Construction productivity

management", Longman.

P.F. Kaming, P.O. Olomolaiye, G.D. Holt and F.C. Harris. (1997) "Factors influencing

construction time and cost overruns on high rise projects In Indonesia", Journal of

Construction management And Economics, 15(1), pp. 83-94.

Palestinians Economic Policy Research Institute (MAS), (2005) "Towards a more effective

use of international aid to the Palestinian People", Retrieve from http://www.pal

econ.org/index.


http://www.emeraldinsight.com/author/Yamin%2C+Mohamed

http://www.emeraldinsight.com/author/Sim%2C+Adriel+KS

79

PMA, Palestine Monetary Authority. (2011) "The economic and social effects of foreign

aid in palestine", Palestine.

Ritter, N. (2010) "Understanding a widely misunderstood statistic: Cronbach's alpha",

Paper presented at Southwestern Educational Research Association (SERA) Conference

2010, New Orleans.

Rustom, R., Amer, M. (2002) "Identification of the factors affecting quality in

building construction projects in Gaza Strip", Islamic University of Gaza, Palestine.

Shipley, D.D., (1981) "Pricing objectives in British manufacturing industry", The Journal

of Industrial Economics, pp. 429-443.

SIGMA, (2011) "Support for Improvement in Governance and Management", Tender

Evaluation and Contract Award, Brief No. 9, pp. 22-29.

Smith, A. E. & Mason, A. K., (1997) "Cost estimation predictive modeling: Regression

versus neural network" The Engineering Economist,Vol 42(2), pp. 137–161.

Sodikov, J., (2005) "Cost estimation of highway projects in developing countries: artificial

neural network approach", the Eastern Asia Society for Transportation Studies, pp. 1036 -

1047.

Strategic Assessment and Estimating Office, (2008) "Cost estimating Manual for WSDOT

Projects guidelines", Washington state: Washington state Department of transportation

Washington state Department of transportation.

Tang, S. L. (2015) "Construction financial management".

Thomas, S., Skitmore, R., Lam, Ka., and Poon, A., (2004) "Demotivating factors

influencing the productivity of civil engineering projects", International Journal of Project

Management, pp. 136-146.

Wang, Q., (2007) "Artificial neural networks as cost engineering methods in a

collaborative manufacturing environment" Int. J. Production Economics, 109(2), pp53–64.

Wang, Y., Yu, C. & Chan, H., (2012) "Predicting construction cost and schedule success

using artificial neural networks ensemble and support vector machines classification

models", International Journal of Project Management, 30(1), pp. 470-478.

World Bank, (1994) "Emergency assistance program for the Occupied Territories" (EAP).

Wynant, l. (1980) "Essential elements of project financing". Harvard Business Review,

May-June, pp. 165-173.

80

Appendices

81

Appendix (A): Questionnaire in English

The Islamic University of Gaza

Higher studies deanery

Faculty of Engineering - Master's program

Infrastructure Construction Engineering

ـــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــ

Questionnaire for

Factors affecting on tender pricing in infrastructure projects in the Gaza

Strip

Dear participants greetings:

First, I want to thank and appreciate your kindness to grant me a part of your valuable time to fill

out my questionnaire, which considered as a basic requirement for the completion of my research

in order to award the master degree in an infrastructure engineering at Islamic university of Gaza.

This research titled as "Factors affecting on tender pricing in infrastructure projects in the Gaza

Strip".

The tender pricing process is one of the most important processes that must be dealt with caution

and accuracy, since in the recent period there have been problems related to the poor pricing of

tenders and produced problems which led to the delay in the implementation of projects. The main

aim of this research is to investigate the critical factors affecting on tender pricing in an

infrastructure projects in the Gaza Strip. The targeted construction projects in the research

include infrastructure projects such as roads, schools, hospitals, water and sewage networks, and

so on. This questionnaire target group is construction contractors, consultants and experts

especially those who worked in infrastructure sector,. And in order to achieve my research

objectives I cordially invite you to fill out this questionnaire. Knowing that it needs 15 minute

to fill out and any collected information from this study will be used to purely academic purposes.

Thanks for your contribution in supporting

the scientific research

Researcher

82

Noor K. Al-Ghazalli

Supervisor

Dr. Bassam A. Tayeh

The questionnaire contents:

This questionnaire consists of two parts, which are as the following:

1st Part: General Information.

2nd Part: Factors affecting on tender pricing related to the owner, consultant, contractor,

donor, market, and the project.

Please tick √ against the convenient option for you, taking into account to put it in front of only one

option.

1. The type of your organization:

Contracting organization Non-Govermental organization

Consultation organization Other, specify ………………..

2. Scientific degree:

Diploma Bachelor's Master Doctorate

3. Job Title for the participant who filling out the questionnaire:

Project manager Site Engineer Office Enginner

Consultant Contractor Other, specify…………

4. Years of experience in an infrastructure sector:

Less than 5 years From 5 years to less than 10 years

From 10 years to less than 15 years 15 years and more

5. Organization's years of experience in an infrastructure sector:

Less than 5 years From 5 years to less than 10 years

From 10 years to less than 15 years 15 years and more

6. Last implemented project cost in USD:

Less than 1 million$ From 1 to 3 million$ More than 3 million$

7. The financial value of the implemented projects in the last five years in USD:

Less than 5 million$ From 5 to 10 million$

From 10 to 15 million$ More than 15 million$

First Part: General Information

83

Second Part: Factors affecting on tender pricing related to the owner, consultant,

contractor, donor, market, and the project. # Item Degree

Factors affecting tender pricing related to the owner

Ver

y l

arg

e

La

rge

Med

ium

Lo

w

Ver

y l

ow

1 The financial performance. 2

The accuracy in evaluating the works which will be

completed.

3 Negative relationships between work parties and the

owner.

4 Owner's financial reputation. 5 Quality and accuracy of tender documents. 6 Tender documents contradiction. 7 Repeated changes which the owner requests. 8 Information and data about construction costs. 9 The owner's tender awarding method. 10 Time period afforded to fill and award tender. 11

Time period to run out the project according to tender

documents.

# Factors affecting on tender pricing related to the

consultant

1 The accuracy of the quantities included in the Bill of

quantities.

2 Technical skills and management experience of the

consultant team.

3 Consultant's ability to control quality. 4 Quality and accuracy of tender documents. 5

The mechanism for carrying out the required works from

the contractor specified by the consultant.

6 Ease of implementation of the designs proposed by the

consultant.

# Factors affecting on tender pricing related to the

contractor

1 Contractor visits to the project site.

84

2 Study tender documents accurately. 3

Follow correct steps in evaluating bids from

subcontractors.

4 Contractor's ability to take risk factors during bid pricing. 5 Contractor's ownership of machinery and equipment. 6 Maintenance costs of machinery and equipment. 7 Interest rate because of financial loans. 8 Evaluation of works according to the bill of quantities. 9 Understand the tender items. 10 Taking into account the productivity of workers. 11

Administrative and technical competence of the

contractor's staff.

12 Wages of skilled workers according to work experience. 13 Coordination between Contractor and Subcontractors. 14 The relationship between managers and employees. 15 Financial Capacity of the Contractor. 16 Contractor performance in previous similar projects. 17

The current work size of the contractor at the time of

tender pricing.

18 The number of competitors entering the tender. 19 The current workload of the bidder. 20 Availability of other projects in the market. 21 Contractor's execution mechanism (if any). 22 Contractor's ability to control costs. 23 Granted time to the contractor in pricing. 24 Guarantee of the project maintenance period. 25 The financial value of the tender. 26

Determine the degree of classification of companies to

enter the tender.

27 Maintain the technical staff, workers and equipment in

the company.

86

# Factors affecting on tender pricing related to the donor

Ver

y l

arg

e

La

rge

Med

ium

Lo

w

Ver

y l

ow

1 Coordination between the owner and the donor of the project. 2 Requirements of payment guarantee of the project. 3 The financial status of the donor. 4 The nature of political conditions in the country. 5 The available fund. 6 Deferred discount of payments to the final payment. # Factors affecting on tender pricing related to the marker 1 Updated contractor's information in the local market. 2

Subcontractors' commitment to the provided prices to the

Contractor.

3 Providing experienced and skilled suppliers. 4 Contractor's workload during bid pricing period. 5 Inflation in raw material prices within the market. 6 Materials and equipment size for the projects. 7 Available other projects in the construction market. 8 Change in local and global market conditions. 9 Considering potential increases in customs duties and taxes. 1

0 Currency prices change in the local market.

1

1 Status of crossing.

# Factors affecting on tender pricing related to the project 1 Project access costs.

2 Meet domestic production of raw materials.

3 Customs duties on imported materials.

4 The nature of the project.

5 The size of the required equipment and tools in the site.

6 Consider changing weather conditions.

7 Political conditions within the country.

87

Appendix (B): Questionnaire in Arabic

غزة – اإلسالمية الجامعة العليا الدراسات عمادة

الماجستير برنامج - الهندسة كلية

البنية التحتيةقسم ـــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــ

حول دراسةاستبانة

ةغزالعوامل المؤثرة على تسعير عطاءات مشاريع البنية التحتية في قطاع

السادة الكرام/

السالم عليكم ورحمة اهلل وبركاته،،،

بداية، أتقدم لكم بالشكر واالمتنان على اعطاء جزء من وقتكم الثمين لتعبئة هذه االستبانة التي تعد جزءا أساسيا من

سمامية في المدنية بالجامعة اإلالدراسة البحثية المطلوبة لنيل درجة الماجستير في قسم البنية التحتية من كلية الهندسة

غزة وهي بعنوان " العوامل المؤثرة على تسعير عطاءات مشاريع البنية التحتية في قطاع غزة ".

هرت حيث أنه في الفترة األخيرة ظ ،أهم العمليات التي يجب التعامل معها بحذر ودقة أحدتعتبر عملية تسعير العطاءات

. تأخر تنفيذ المشاريعفي مشاكل مما أدى إلى خلق تمشاكل متعلقة بسوء تسعير العطاءا

ريع الهدف الرئيسي من هذه الدراسة هو تحديد ومعرفة أهم العوامل التي تؤدي إلى أخطاء في تسعير عطاءات مشا

البنية التحتية في قطاع غزة، وتشمل مشاريع البنية التحتية كالطرق وخدمات المستشفيات والمدارس وشبكات المياه

صرف الصحي، وغيرها من المشاريع التي تنفذها الجهات المختلفة.وال

وتستهدف هذه الدراسة فئة الخبراء واالستشاريين والمقاولين في مجال اإلنشاءات وخاصة في قطاع البنية التحتية،

دقيقة لتعبئتها 15ارب ولتحقيق أهداف هذه الدراسة تم اختيار سيادتكم من أجل تعبئة االستبانة التي يتوقع أن تحتاج لما يق

مع العلم بأنه سيتم استخدام البيانات التي ستجمع ألغراض البحث العلمي فقط.

ولكم كل الشكر والتقدير على مساهمتكم في دعم البحث العلمي.

الباحث

نور خليل الغزالي

المشرف

د. بسام عبدالرحمن تايـه

88

مكونات االستبانة: االستبانة من قسمين، وهما كما يلي:تتكون هذه

:معلومات عـامةالقسم األول

:العوامل المؤثرة على تسعير العطاءات ولها عماقة بكل من: المالك واالستشاري والمقاول والممول القسم الثاني

والسوق والمشروع.

القسم األول/ معلومات عــامة

مقابل اإلجابة التي تراها مناسبة ونرجو مراعاة وضعها أمام خيار واحد فقط. √الرجاء وضع إشارة

نوع الشركة أو المؤسسة التي تعمل بها: .1

أخرى، وضح ذلك ........... مؤسسة استشاري مقاول

الدرجة العلمية: .2

دكتوراه ماجستير بكالوريوس دبلوم

وظيفتك داخل الشركة أو المؤسسة: .3

مهندس مكتب مشروع مهندس موقع مدير

أخرى، وضح ذلك ............ استشاري مقاول

خبرتك في قطاع البنية التحتية: .4

سنة 15أكثر من سنة 15أقل من -10 سنوات 10أقل من -5 سنوات 5أقل من -1

خبرة الشركة أو المؤسسة التي تعمل بها في قطاع البنية التحتية: .5

سنة 15أكثر من سنة 15أقل من -10 سنوات 10أقل من -5 سنوات 5أقل من -1

تكلفة آخر مشروع بالدوالر األمريكي: .6

مليون دوالر 3أكثر من مليون 3-1 مليون 1من أقل

سنوات األخيرة بالدوالر األمريكي: 5قيمة المشاريع التي نفذتها الشركة او المؤسسة التي تعمل بها خالل .7

مليون دوالر 15مليون أكثر من 15-10 مليون 10-5 مليون 5أقل من

89

الرق

م درجة التأثير الفقرة

لها عالقة بالمالكوتسعير العطاء ىعل عوامل مؤثرة #

داج

ة ير

كب

رةبي

ك

ة ط

سومت

رة

غيص

داج

ة ير

صغ

األداء المالي 1

الدقة في تقدير األعمال التي سيتم إنجازها 2

وجود عماقات سلبية بين أطراف العمل والمالك 3

السمعة المالية للمالك 4

جودة ودقة وثائق العطاء 5

تناقض وثائق العطاء 6

التغيرات المتكررة التي يطلبها المالك 7

المعلومات والبيانات عن تكاليف اإلنشاء 8

لدي المالك ألية ترسيه العطاء 9

الفترة الزمنية الممنوحة لتعبئة وترسيه العطاء 10

المدة الزمنية لتنفيذ المشروع حسب وثائق العطاء 11

تسعير العطاء لها عالقة باالستشاري ىعوامل مؤثرة عل

المدرجة في جدول الكمياتمــدى دقة الكميات 1

اإلدارية لدى فريق االستشاريالخبرة المهارات الفنية و 2

قدرة االستشاري علي ضبط الجودة 3

وثائق العطاء ودقة جودة 4

التي يحددها االستشاري آلية تنفيذ األعمال المطلوبة من المقاول 5

سهولة تنفيذ التصميمات المقترحة من قبل االستشاري 6

تسعير العطاء لها عالقة بالمقاول ىمؤثرة علعوامل #

قيام المقاولين بزيارة ميدانية لموقع المشروع 1

دراسة وثائق العطاء بشكل دقيق 2

3 اتباع خطوات سليمة في تقييم عروض األسعار المقدمة من مقاولي

الباطن

في تسعير العطاءقدرة المقاول على أخذ عوامل المخاطرة 4

90

ملكية المقاول لآلالت والمعدات 5

تكاليف صيانة اآلالت والمعدات 6

معدل الفائدة نتيجة القروض المالية 7

تقييم األعمال وفقا لجدول الكميات 8

فهم بنود العطاء 9

األخذ بعين االعتبار إنتاجية العمال 10

طاقم المقاولالكفاءة اإلدارية والفنية لدى 11

أجور العمال المهرة ذوي الخبرة في العمل 12

التنسيق بين المقاول ومقاولي الباطن 13

العماقة بين اإلدارة والعاملين 14

للمقاولالقدرة المالية 15

المقاول في مشاريع مشابهة سابقة أداء 16

حجم العمل الحالي للمقاول وقت تسعير العطاء 17

عدد المتنافسين في دخول العطاء 18

حجم العمل الحالي للمتنافسين في العطاء 19

مدى توفر مشاريع أخرى في السوق 20

األعمال المطلوبة من المقاول )إن وجدت(آلية تنفيذ 21

فريق عمل المقاول على ضبط التكاليف قدرة 22

الوقت الممنوح للمقاول في التسعير 23

ضمانة فترة صيانة المشروع 24

القيمة المالية للعطاء 25

تحديد درجة التصنيف للشركات للدخول في العطاء 26

المحافظة علي الطاقم الفني والعمال والمعدات لدي الشركة 27

91

درجة التأثير الفقرة لرقما

تسعير العطاء لها عالقة بالممول ىعوامل مؤثرة عل #

جدة

يركب

ا

رةبي

ك

ة ط

سومت

ة ير

صغ

داج

ة ير

صغ

التنسيق بين المالك والجهة الممولة للمشروع 1

متطلبات الدفعات المالية للمشروع 2

القدرة المالية للجهة الممولة 3

طبيعة الظروف السياسية داخل البلد 4

التمويل المتاح 5

الخصم المؤجل للدفعات وصرفها بالدفعة النهائية 6

درجة التأثير الفقرة الرقم

تسعير العطاء لها عالقة بالسوق ىعوامل مؤثرة عل #

جدة

يركب

ا

رةبي

ك

ة ط

سومت

ة ير

صغ

جدة

يرصغ

ا

تحديث معلومات المقاول في السوق المحلي 1

التزام مقاولي الباطن باألسعار المقدمة للمقاول 2

توفر موردين ذوي خبرة ومهارة 3

فترة تسعير العطاءحجم العمل لدى المقاول أثناء 4

تضخم في أسعار المواد الخام داخل السوق 5

المواد وحجم المعدات المازمة للمشاريع 6

توفر مشاريع أخرى في سوق اإلنشاءات 7

تغير في أوضاع السوق المحلي والعالمي 8

بالجمركية والضرائاألخذ بعين االعتبار الزيادات المحتملة للرسوم 9

تغير اسعار العممات في السوق المحلي 10

وضع المعابر 11

92

بالمشروعلها عالقة مؤثرة على تسعير العطاء عوامل #

جدة

يركب

ا

رةبي

ك

ة ط

سومت

ة ير

صغ

جدة

يرصغ

ا

تكاليف الوصول لموقع المشروع 1

اإلنتاج المحلي للمواد الخامتلبية 2

الرسوم الجمركية المفروضة على المواد المستوردة من الخارج 3

طبيعة المشروع 4

حجم المعدات المطلوبة داخل الموقع 5

األخذ باالعتبار تغير الظروف الجوية 6

الظروف السياسية داخل البلد 7

Factors Affecting on Tender Pricing of Infrastructure ... · Factors Affecting on Tender Pricing of...

Documents

Transcript of Factors Affecting on Tender Pricing of Infrastructure ... · Factors Affecting on Tender Pricing of...