The Tender Trap: How Unrealistic Bid Assumptions Derail Projects Before They Begin

Introduction

In Iraq and across the region, many infrastructure projects fail long before the first excavator hits the ground.

The problem isn’t corruption, materials, or weather — it’s bad assumptions baked into the tender stage.

When firms underestimate logistics, overestimate capacity, or rely on unrealistic delivery timelines, they set themselves up for failure before a single contract is signed.

The Planning Mirage

Tender documents often present a best-case scenario — short mobilisation windows, seamless approvals, fixed payment cycles.

Contractors respond with equally optimistic bids, chasing competitiveness rather than feasibility.

But once the project is awarded, reality hits:

• Roads are closed or security permits delayed.

• Imported equipment sits at port awaiting clearance.

• Payment milestones stretch months longer than expected.

Each variable compounds cost and pressure.

What looked profitable on paper quickly turns into a cashflow nightmare.

The Hidden Cost of Optimism

Contractors routinely lose 5–20% of margin because of assumptions that don’t survive contact with reality.

Examples include:

• Underestimating demurrage costs at Basra or Umm Qasr.

• Ignoring power outages that halt fabrication or batching.

• Assuming 24/7 site access in high-security zones.

• Treating ministry approvals as a formality rather than a variable.

Every missed assumption forces a reactive response — extensions, disputes, or loss of credibility.

And in Iraq’s small market, reputational damage lingers far longer than financial loss.

Procurement as an Intelligence Exercise

Winning a tender shouldn’t just mean offering the lowest price — it should mean understanding what the client hasn’t told you.

Smart contractors treat procurement as reconnaissance.

Before submission, they map:

• Actual access routes and seasonal constraints.

• Customs and tax clearance timelines.

• Approval authority layers within each ministry.

• Political or funding dependencies that could delay release of payments.

Those insights don’t just improve pricing — they shape execution strategy.

Recalibrating the Bid Mindset

Contractors need to pivot from “winning the bid” to “delivering the contract.”

That means:

• Integrating legal, logistics, and finance teams during bid stage.

• Adding contingency models that reflect Iraq’s on-ground conditions.

• Declaring assumptions transparently rather than hiding them in fine print.

• Challenging unrealistic client expectations before signing, not after.

Professional credibility doesn’t come from optimism — it comes from delivery.

The Client’s Role

Public agencies and investors also share blame.

They often reward the cheapest bids, even when the technical proposals are weak.

This short-term focus inflates risk and guarantees overruns.

Tender evaluation systems need to value realism, not rhetoric.

The best results come when bids are scored on evidence — delivery records, local partnerships, and real logistics planning — not just promises.

Conclusion

Iraq’s infrastructure pipeline is full of promise, but its success depends on smarter bidding.

A realistic tender isn’t a sign of weakness — it’s a sign of competence.

Until contractors and clients alike learn to price risk honestly, Iraq’s most ambitious projects will keep falling into the same trap:

They were lost before they began.