The real differences between direct appointment and competitive tender

In an industry where reliability, performance and cost all carry equal weight, choosing how to procure electrical services can be just as important as selecting the provider itself. Regardless of the type of project – from EV to solar, data cabling to a complete office fit out - you're likely to face the same question - should I go for a competitive tender, or should I appoint directly, writes Phil Wiltshire, operations director at Pensdown, the electrical people?

For years, the competitive tender process has been the industry standard - perceived as the most transparent, compliant and cost-efficient way to deliver projects. But in recent years, an increasing number of clients have been questioning this default position. In sectors where time, trust and technical expertise matter just as much as price, working directly with a skilled, reputable contractor from day one can offer serious advantages.

The competitive tender process remains the most widely used procurement method across the construction and M&E industries. Its logic is simple - a clear specification is issued to multiple contractors and bids are submitted based on scope, cost and capability. In theory, it encourages market competition, delivers value for money and protects against bias or favouritism.

When managed well, the process can ensure transparency and provide a level playing field. It’s particularly useful on large-scale public sector frameworks or when there’s a clear-cut scope of works with minimal deviation. However, the system is not without its drawbacks - particularly when applied to complex electrical work or fast-track programmes.

The challenge

One of the core assumptions behind competitive tendering is that the specification is complete, unambiguous and technically robust. But electrical work, especially in retrofit, refurbishment, or design-and-build environments, often involves variables that only become clear during site investigations or early-stage coordination. These can include unrecorded legacy installations, undocumented load demands, or evolving client expectations.

As a result, contractors may price for worst-case scenarios - or worse, underprice to win the work, knowing variations will be inevitable. This can lead to cost disputes, project delays and a shift in focus from collaboration to commercial recovery.

Preparing and evaluating tenders is also time-consuming and resource-intensive. Clients must invest in issuing documents, fielding questions, analysing returns and managing compliance. For the contractors, the process can be equally costly - with days or even weeks spent preparing submissions with no guarantee of return.

For projects where speed, flexibility or agility are important, the traditional tender process may feel out of step with delivery pressures. In those situations, a direct appointment can often result in faster delivery, clearer communication and earlier problem-solving.

The case for direct appointment

Direct appointment - where a client engages a trusted contractor without going to a full competitive tender - may not be suitable for every project, but for many, it provides measurable advantages. It allows a closer working relationship, early involvement and a shared focus on delivering the best outcome - not just the cheapest initial price.

Electrical contractors brought in early can contribute significantly to the design and planning process. They can flag coordination issues, identify smarter routing options and ensure that electrical load calculations, containment strategies and distribution layouts are realistic and value-engineered before the build even starts.

One of the biggest misconceptions about direct appointment is that it leads to higher costs. In reality, clients working directly with a trusted contractor often achieve better value - not because the price is lower in a headline sense, but because it’s more accurate, better targeted and includes realistic allowances.

Direct engagement also allows for open-book discussions. If there’s a need to reduce cost, it is possible to explore options together - changing cable routes, adjusting containment materials, or phasing work to better match budget cycles.

When a contractor is appointed directly, their accountability to the client also becomes personal. There’s no ‘lowest bidder’ mentality - the focus moves from winning the work to delivering it well. For clients, this often translates to better communication, quicker issue resolution and a stronger commitment to programme milestones.

However, it must be acknowledged that the core concern for many clients considering a direct appointment, is risk. Without multiple quotes, how can you be sure you’re not overpaying? What if the contractor underdelivers?

The answer lies in due diligence and relationship management. A direct appointment should never mean working blindly. It should be based on proven track record, verified competencies and references. It may also include fixed-price agreements, milestone reviews, or cost benchmarks drawn from comparable projects.

On the flip side, competitive tendering does not always reduce risk. A contractor selected purely on cost may cut corners, under-resource the job, or rely on variations to recover margin. The lowest price can sometimes carry the highest risk if it compromises quality or safety.

Where direct appointment adds value

Design-and-build projects, in particular, are where direct appointment often adds the most value. In these cases, the contractor is responsible not only for installation, but for contributing to the design itself. This demands an electrical contractor who understands both compliance and constructability and who can liaise effectively with consultants, architects and other trades.

By working directly with an appointed contractor from the outset, clients gain access to a team that can help shape a more efficient, better coordinated electrical design. They can spot early clashes, advise on load diversity, suggest suitable containment strategies and align with the latest regulations - helping to avoid expensive redesigns or late-stage alterations.

Another advantage of working with a known and trusted contractor is assurance around compliance and safety. Electrical installations are high-risk environments and clients must be confident that all work is carried out to the highest standard - with full traceability, certification and adherence to BS 7671 and other relevant standards.

That said, there are still scenarios where competitive tendering remains the most appropriate route - especially on publicly funded projects or where strict procurement policies apply. Frameworks, OJEU thresholds and compliance requirements may dictate the need for formal competition and there’s value in the discipline and structure this process provides.

There’s no one-size-fits-all answer when it comes to procurement. The right choice between direct appointment and competitive tender depends on the nature of the project, the priorities of the client and the importance placed on trust, flexibility and technical input.

What’s clear, however, is that the landscape is changing. More clients are recognising the benefits of engaging skilled electrical contractors earlier and more directly. They see the value not just in cost control, but in collaboration, accountability and better outcomes. Because in the end, electrical work is not just about cables and circuits - it’s about trust, delivery and making the right connections - at every stage of the project.