Critical Factors Determining Bid/No Bid Decisions of Contractors in Qatar

Abstract

To bid or not to bid for construction projects is a crucial strategic decision for contractors’ sustainability in the industry. The high complexity and uncertainty associated with such a decision-making process, which involves several multitudes and reflection of numerous internal and external determinants, necessitate further exploration of the prominent factors underpinning contractors’ decisions. Following the announcement of awarding the “Federation Internationale de Football Association” (FIFA) 2022 World Cup hosting rights to the State of Qatar on December 2, 2010, the State is pledging to spend tens of billions of dollars on hundreds of new projects. Thus, the objective of this case study is to identify, explore, and rank the relative importance of the critical factors determining contractors’ decisions to bid or not bid for local construction projects. To achieve this objective, a structured questionnaire survey comprising 43 factors that were shortlisted based on relevant previous investigations on bidding practices in the construction industry, and the input of local industry experts and professionals, was distributed to a statistically representative sample of contractors. Using the “Relative Importance Index” technique, the following critical factors are identified: (1) previous experience with the employer, (2) need for work, (3) current workload, (4) previous experience in similar projects, (5) size of project, (6) identity and reputation of the employer in the industry, (7) financial stability of the employer, (8) availability of other projects, (9) promptness of the employer in the payment process, and (10) tender documents quality level. The outcomes reported in this study can be used to provide employers, consultants, contractors, and policymakers, guidance for focusing, acting upon, and controlling the cardinal factors perceived to impact contractors’ bidding behaviors in an environment on the brink of undergoing an unprecedented boom in demand for faster delivery and lower cost of constructed facilities.