Government and private tenders in the Saudi market represent one of the largest growth opportunities for any company, whether you are a contractor, supplier, technology firm, or consulting office. The ministries of Health, Education, Defense, and Interior, along with major corporations and semi-government entities, issue thousands of tenders annually with values ranging from hundreds of thousands to billions of riyals. But entering this market requires real financial and administrative maturity, because the bid opening committee shows no mercy to any mistake in the Technical Proposal or Financial Proposal.
Many small and medium companies in Riyadh, Jeddah, and Dammam lose tenders they could have executed, simply because of weak proposal drafting, a missing document, or inaccurate cost calculations that pushed pricing 8% to 15% above competitors. On the other side, other companies win the tender only to discover that their real profit margin is negative because they forgot to account for indirect costs, guarantee fees, or VAT correctly.
This ready Technical and Financial Bid Proposal template gives you a professional structure aligned with Etimad platform requirements and government procurement regulations, and it integrates cost calculation, guarantees, tax, and profit margin in a single file. Use it for precise pricing, a fast pre-submission review, and a proposal that clears the critical technical evaluation threshold of 70 points.
Tender Technical and Financial Bid Proposal Template in Excel + Google Sheets
A complete file containing the Technical Proposal template with its seven sections, a direct and indirect cost calculation sheet, an initial and final guarantee calculator, and an editable Etimad document checklist ready before submission.
What is a Technical and Financial Bid Proposal in the Saudi market
The Technical and Financial Bid Proposal is the official document a bidding company submits for a government or private tender, demonstrating its ability to execute the project on the technical side, along with the final price in full detail. Under the Saudi Government Tenders and Procurement Law issued by Royal Decree No. M/128, the two proposals are submitted separately in sealed and stamped envelopes, so the financial envelopes are not opened until the technical evaluation is completed and bidders have cleared the minimum threshold.
The tender owner (a ministry, an authority, a semi-government corporation, or a private company) issues the Request for Proposal (RFP) defining the scope of work, technical criteria, timeline, payment terms, penalties, required guarantees, and the weight of each item in the evaluation. Your job as a bidder is to read the RFP carefully and build a proposal that responds to every point in order, without adding side conditions that could disqualify you.
When do you need to submit separate Technical and Financial Proposals
Every public tender issued by a government entity through the Etimad platform, or a limited competition by a semi-government company such as Aramco, SABIC, and the banks, requires separating the two proposals. Exceptions include low-value pure supply competitions, or direct purchase orders below SAR 100,000, where sometimes a financial proposal supported by brief technical specifications is enough.
The difference between a public tender, a limited competition, and a direct purchase order
- Public tender: open to all qualified suppliers, announced on Etimad, proposals submitted electronically, and opened in a public session.
- Limited competition: the entity invites selected suppliers from an approved list, usually due to specialized or confidential technical nature.
- Direct purchase: limited value, a single supplier, abbreviated procedures, but a detailed financial proposal is still required.
- Framework agreement: a long-term contract at an estimated value, from which operational purchase orders are drawn as needed.
The core difference between the Technical Proposal and the Financial Proposal
Confusing the two proposals is the most common mistake among companies new to the tendering system. The golden rule: no price figure, value, discount, or financial condition may appear inside the Technical Proposal. Even the cost of a spare part or a work hour mentioned inside the Technical Proposal counts as a sufficient violation to exclude the company entirely from the competition, because the system assumes the technical evaluation committee judges capability and quality alone, without being influenced by price.
The Technical Proposal answers the question “how will you execute the project and with what standards and resources”, while the Financial Proposal answers the question “for how much”. The first contains technical specifications, experience, certifications, the team, a quality plan, and a timeline. The second contains detailed pricing tables in Saudi Riyals, guarantees, payment terms, and VAT.
The separate and sealed envelope rule
Under the previous paper system, the two envelopes were physically different and sealed with red wax. On the Etimad electronic platform, each proposal is uploaded in a separate encrypted field, and the entity’s staff cannot open the financial file before the technical evaluation is complete. Any mistake in uploading a financial file inside the technical slot closes the door permanently.
Full components of the Technical Proposal
A successful Technical Proposal starts with an official cover letter on company letterhead addressed to the head of the bid opening committee, mentioning the name of the competition, its Etimad reference number, the company name, commercial registration, and the authorized signatory. Then come the technical sections that build a complete picture of the company’s capability.
| Section | Required content | Suggested weight |
|---|---|---|
| 1. Company profile | Commercial registration, license, legal structure, capital, branches, headcount | 5% |
| 2. Past experience | Similar projects in the last 3 to 5 years with documented completion certificates | 20% |
| 3. Technical methodology | Project execution plan, phases, deliverables, quality standards | 20% |
| 4. Proposed team | CVs, certifications, roles, allocation percentage | 15% |
| 5. Timeline | Gantt chart with dates and key milestones | 10% |
| 6. Risk management plan | Risk identification, likelihood, impact, mitigation steps | 10% |
| 7. Quality and accreditation certificates | ISO 9001, ISO 27001, sector-specific certifications | 10% |
| 8. Knowledge transfer and warranty plan | Post-delivery training, warranty period, after-sales service | 10% |
Common mistakes inside the Technical Proposal
- Copy-paste from a previous proposal: the evaluation committee instantly spots any reference to another project or entity.
- Weak CVs: missing certifications or experience immediately costs points in the proposed team section.
- Missing timeline: submitting a plan without a detailed Gantt chart loses you the full score for this item.
- Mentioning financial figures: any price figure inside the Technical Proposal disqualifies the entire bid, even if the rest of the sections are excellent.
Full components of the Financial Proposal
The Financial Proposal must be organized in clear tables, so the entity’s financial reviewer can grasp the pricing at a single glance. The biggest mistake is presenting a lump-sum figure without itemizing the cost components, because that makes the proposal non-negotiable and may lead to formal rejection.
| Item | Quantity | Unit price (SAR) | Total before VAT | VAT 15% | Total including VAT |
|---|---|---|---|---|---|
| Main equipment | 50 | 12,000 | 600,000 | 90,000 | 690,000 |
| Spare parts and accessories | 1 | 180,000 | 180,000 | 27,000 | 207,000 |
| Installation and commissioning | 1 | 95,000 | 95,000 | 14,250 | 109,250 |
| User training | 20 days | 2,500 | 50,000 | 7,500 | 57,500 |
| First-year maintenance | 1 | 75,000 | 75,000 | 11,250 | 86,250 |
| Total | 1,000,000 | 150,000 | 1,150,000 |
Suggested payment terms
The norm in government tenders is that payment terms are fixed in the RFP, but in some cases you are allowed to propose a payment structure. The common pattern: 20% advance payment against a bank guarantee, 60% across execution milestones, and 20% after final acceptance and the end of the warranty period. Do not request terms better than those stated in the RFP, because that counts as a reservation and may disqualify your proposal.
Proposal validity
The Financial Proposal must specify its validity period, and in the Saudi market it is typically 90 days from the date of bid opening, sometimes 120 days for major projects. Offering a shorter validity costs you the bid, while a longer validity is acceptable but not required.
Calculating the actual cost of the proposal
Successful pricing starts from the inside: determining the full actual cost before adding profit margin. Many companies lose tenders because they price above competitors, and many win tenders only to lose money on them because they priced below true cost. The standard formula:
Final price = direct cost + indirect cost + administrative overhead + risk reserve + profit margin + VAT
| Cost type | Components | Common share of price |
|---|---|---|
| Direct cost | Materials, project technician wages, dedicated equipment | 55% to 65% |
| Indirect cost | Warehouse rent, transport, goods insurance, project communications | 5% to 8% |
| Administrative overhead | Management salary, accountant, office rent, marketing, licenses | 8% to 12% |
| Guarantee and financing costs | Bank guarantee commission, working capital interest | 1% to 3% |
| Risk reserve | Delivery delay, price inflation, potential penalties | 3% to 5% |
| Profit margin | Net company profit after all costs | 10% to 18% |
Practical example: a Ministry of Health tender to supply equipment worth SAR 3.5 million
Assume the company is bidding to supply medical equipment to hospitals in Riyadh and Jeddah. The detailed calculation:
- Direct cost of the equipment from the foreign supplier: SAR 2,030,000 (58% of price).
- Shipping, customs clearance, inland transport: SAR 175,000 (5%).
- Installation and training across 4 sites: SAR 245,000 (7%).
- Administrative overhead allocated to the project: SAR 350,000 (10%).
- Initial and final bank guarantee commission: SAR 52,500 (1.5%).
- Risk reserve for shipping delays and currency fluctuation: SAR 122,500 (3.5%).
- Target profit margin of 15%: SAR 525,000.
- Total price before VAT: SAR 3,500,000.
- VAT at 15%: SAR 525,000.
- Final price including VAT: SAR 4,025,000.
If you drop the risk reserve to compete on price, any minor shipping issue turns into a direct hit on your profit margin. And if you raise the margin to 22% to cover a potential delay, your price moves above market and falls out of the financial evaluation.
The Etimad platform and how to submit your proposal electronically
Etimad is the unified government procurement gateway in the Kingdom, operated by the Expenditure and Projects Efficiency Authority. Every government tender is announced and submitted through it, except for national security cases. Registering your company on the platform is a prerequisite for participation, and it requires an active commercial registration and a business account on the National Single Sign-On (Nafath).
Steps to submit a proposal on Etimad
- Pre-register in the competition: log into the company account, find the competition by its reference number, and click “Register in the competition” within the deadline.
- Download the RFP: it may be paid (SAR 500 to 5,000 depending on the competition size) or free.
- Prepare the Technical Proposal as a separate PDF file: complete content, numbered, indexed, with no financial figure.
- Prepare the Financial Proposal as a separate PDF file: detailed tables, company stamp, signature of the authorized signatory.
- Upload the initial guarantee: an electronic bank guarantee letter, issued by the bank directly on the platform.
- Attach the statutory documents: commercial registration, ZATCA certificate, GOSI certificate, Saudization certificate, quality certificates.
- Electronic signature and submission: at least two hours before the deadline to avoid any technical issue.
Critical dates in the life of a tender
Etimad treats deadlines with second-by-second precision. A one-minute delay cancels your right to participate. Key dates the team must put on the calendar: the last day for inquiries, the last day for amendments from the entity, the proposal submission date, the technical envelope opening date, the financial envelope opening date, and the award date.
Statutory documents attached to the proposal
These documents are the company’s ID card before the bid opening committee, and any gap in them exposes the proposal to formal exclusion before it even reaches the technical evaluation. Make sure all of them are valid through the bid opening date, not just through the submission date.
| Document | Issuing authority | Validity |
|---|---|---|
| Commercial registration | Ministry of Commerce | 1 year |
| Zakat, Tax and Customs Authority (ZATCA) certificate | ZATCA | 1 year (renewed after Zakat filing) |
| General Organization for Social Insurance certificate | GOSI | 1 to 3 months |
| Saudization (Nitaqat) certificate | Ministry of Human Resources and Social Development | 1 month |
| Municipal license | Municipality | 1 year |
| Chamber of Commerce membership certificate | Chamber of Commerce | 1 year |
| Contractor classification (if applicable) | Saudi Contractors Authority | 3 years |
| E-invoicing certificate | ZATCA (Phase 2 e-invoicing) | Permanent after integration |
| Audited financial statements | SOCPA-licensed accounting firm | Latest fiscal year |
Additional requirements by tender nature
In healthcare tenders you need to register your products with the Saudi Food and Drug Authority, and in IT tenders you need ISO 27001 certification or accreditation from the National Cybersecurity Authority. In construction tenders, the contractor needs a valid classification at the required grade. Read the RFP letter by letter to extract every requirement.
Guarantees: initial, final, and advance payment
Guarantees in Saudi tenders are strictly financial, issued by an approved bank, and submitted as an electronic bank guarantee letter through Etimad. Cash guarantees or cheques are not accepted in most government competitions.
| Guarantee type | Percentage of bid value | Timing | Approximate bank commission |
|---|---|---|---|
| Initial guarantee | 1% to 2% | At proposal submission | 0.5% per year |
| Final guarantee | 5% | At contract signing | 0.75% to 1% per year |
| Advance payment guarantee | Equal to the advance (typically 20%) | Before the advance is paid out | 0.75% to 1% per year |
| Maintenance guarantee | 5% of the value of the portion under maintenance | At final acceptance | 0.75% per year |
The impact of guarantee commissions on pricing
In the earlier example (a SAR 3.5 million tender, 9-month execution period, 1-year warranty), the actual cost of the guarantees is:
- Initial guarantee 2% x 0.5% x 0.25 year: SAR 87.5 (monthly).
- Final guarantee 5% x 1% x 0.75 year: SAR 1,312.
- Advance payment guarantee 20% x 1% x 0.5 year: SAR 3,500.
- Maintenance guarantee 5% x 0.75% x 1 year: SAR 1,312.
The simple total for guarantees comes close to 1.5% to 2% of the contract value, and should never be ignored in pricing.
VAT in tender proposals
VAT at 15% applies to all supply and service contracts in the Saudi market, except in statutorily exempt cases. In government tenders the bidder is required to show VAT separately in the Financial Proposal, so the entity can recognize it as a recoverable amount for tax purposes.
The difference between VAT-inclusive and VAT-exclusive
- VAT-inclusive proposal: the final price already includes 15% VAT. Used when the RFP explicitly requires it.
- Pre-VAT proposal with VAT on a separate line: the most common form, separating the actual contract value from the tax.
- Non-taxable proposal: only for exempt goods and services (such as exports, specific healthcare services).
Mixing the two formats confuses the financial evaluation committee and may lower your ranking. The rule: stick literally to the pricing table format attached to the RFP, and do not invent your own table.
E-invoicing and government entity contracts
Every invoice issued to the government entity after award must be an electronic invoice compliant with Phase 2 of e-invoicing issued by ZATCA, including the QR code, sequential invoice number, and the XML transmitted to the authority’s portal. A supplier’s failure to comply delays payment and may trigger penalties.
How the committee evaluates proposals
Evaluation in Saudi tenders follows a composite mechanism: a technical evaluation, then a financial evaluation, then the weighted total score. The most common weights are 60% technical and 40% financial, but in IT and consulting tenders the technical weight can reach 80%, and in simple supply tenders it can drop to 40%.
| Evaluation stage | Action | Possible outcome |
|---|---|---|
| 1. Formal screening | Verification of documents, initial guarantee, signatures | Acceptance or formal exclusion |
| 2. Technical evaluation | Scoring technical sections per their weights | Technical score out of 100 |
| 3. Clearing the minimum threshold | Typically 70 points out of 100 | Qualified for the financial stage or excluded |
| 4. Opening financial envelopes | Only for companies that cleared the technical stage | Financial score out of 100 |
| 5. Weighted total score | (Technical x weight) + (Financial x weight) | Final ranking |
| 6. Award | Committee recommendation, then disbursement approval | Winner announced on Etimad |
How the financial score is calculated
The most used formula: (lowest price submitted / your price) x 100. If the lowest financial bid was SAR 3,000,000 and your price is SAR 3,500,000, your financial score = (3,000,000 / 3,500,000) x 100 = 85.7 points. This explains why a 15% gap in price costs you a full 14 points in the final evaluation, and could be the difference between winning and losing.
The most common mistakes that cost you the tender
Based on documented experience from mid-size Saudi companies participating in government tenders over 5 years, 80% of exclusion cases trace back to causes that can be avoided with a simple checklist.
- Late submission on Etimad: even a few seconds past the deadline are automatically rejected.
- Initial guarantee below the required value: even a one-riyal shortfall, the system excludes the bid.
- Expired document: a GOSI or ZATCA certificate expired even by one day.
- Unauthorized signature: a person who is not authorized on the commercial registration cannot sign the proposal.
- Mentioning a financial figure inside the Technical Proposal: immediate exclusion, even if it slipped into a page footer by mistake.
- Not following the RFP format: changing the official pricing table or deleting items.
- Adding reservations and side conditions: such as “the price is valid only if exchange rates do not change” voids the bid.
- Missing signature and company stamp on every page: an essential condition in some tenders.
- Pricing below cost: the tender committee may reject the bid if it deems it non-serious due to abnormally low pricing.
- Relying on a single financial proposal file with no backup: a technical glitch at upload time equals a lost opportunity.
Final checklist before clicking “Submit”
- Technical and financial as two separate files, PDFs signed and stamped.
- Electronic initial guarantee issued by an approved bank, with the correct value and validity.
- All documents valid through the envelope opening day, not just the submission day.
- Pricing table matched literally to what is in the RFP.
- Proposal validity of 90 days or more clearly stated.
- Every page signed and stamped by the authorized signatory.
How Qoyod helps you prepare the Financial Proposal
Preparing an accurate Financial Proposal starts with knowing your real costs and having the flexibility to generate reports. Qoyod gives you the audited financial statements for the latest year in one click, cost reports by cost center, project profitability reports, and all of them in formats ready to attach with your proposal.
Reports ready to attach directly
- Financial statements: income statement, balance sheet, cash flow in PDF.
- Receivables aging report: to demonstrate liquidity and collection discipline.
- Inventory turnover report: important in supply tenders to demonstrate continuous operating capability.
- Past project profitability report: evidence of mature project management.
- VAT report: to demonstrate consistent filing with the authority.
Phase 2 e-invoicing ready
After award, you need to issue invoices compliant with Phase 2 of e-invoicing. Qoyod is fully integrated with ZATCA and issues a tax invoice with QR and approved XML with no manual intervention, protecting the payment flow from the government entity.
Specialized support for every step
The support team is available 24 hours, 7 days a week to help you prepare the required financial reports before the submission deadline, or issue electronic invoices after the award. Qoyod plans start at prices that fit every size of company bidding on tenders.
Frequently asked questions
Can the Technical and Financial Proposals be submitted in one PDF file to save time?
No. That is a clear violation of Etimad rules and of the Government Tenders and Procurement Law. The two files must be uploaded in separate slots on the platform, and each is encrypted until the technical envelope opening date, then the financial envelope opening date, independently. Any mixing leads to formal exclusion before any review.
What is the minimum technical score that must be cleared?
Usually 70 points out of 100 in standard government RFPs, but some specialized tenders, such as sensitive IT and major construction projects, raise the threshold to 75 or 80 points. Read the RFP to find the specific threshold, since it is stated explicitly in the “Evaluation mechanism” section.
Is VAT calculated on the value of bank guarantees?
No. The bank guarantee is not a sale of goods or services by the supplier; it is a bank undertaking in favor of the government entity. The guarantee itself is not subject to VAT, but the bank commission you pay as the supplier may be subject to VAT depending on the nature of the banking service.
What do I do if I discover a mistake in my proposal after uploading it on Etimad, before the deadline?
As long as the submission window is still open, you can withdraw your proposal from the platform, amend the files, and re-upload them. The system considers the last version uploaded before the deadline. After the submission window closes, no edits are possible at all, even if the error is a typo in the price figure.
How much does it cost to participate in a tender on Etimad?
The RFP may be free or priced between SAR 500 and SAR 5,000 depending on the size of the competition. The initial bank guarantee commission ranges from 0.4% to 0.6% per year of the guarantee value. There are no additional platform fees for registered suppliers.
Can I submit proposals to multiple tenders at the same time without affecting my guarantee budget?
Yes, provided you have enough credit headroom with the bank. Each initial guarantee freezes part of your credit limit until the tender result is announced. Mid-size companies in Riyadh and Jeddah typically work with at least two banks to spread the guarantee limit and make it easier to bid in multiple competitions.
What is the difference between the required GOSI certificate and the Saudization certificate?
The GOSI certificate proves your compliance with social insurance contributions for all employees, while the Saudization certificate from the Ministry of Human Resources proves that the share of Saudi nationals in your company is within the required Nitaqat band (typically Green or Platinum) according to your activity and size. The two certificates are distinct and both are required.
Can small companies compete in tenders from large entities such as the Ministry of Health?
Yes. The Expenditure Efficiency Authority has placed special focus on enabling small and medium enterprises, and in many tenders a portion is reserved exclusively for them or they receive a price preference. The real challenge is securing bank guarantees and audited financial statements, which requires an organized accounting system from day one.
Start organizing your tender proposals today
Prepare your audited financial statements, cost reports, and Phase 2 compliant e-invoicing in one place, and attach all of it with your Financial Proposal in a single click. Start your free Qoyod trial now.