A low price can look like a win. But in public procurement, it can also trigger scrutiny, delay award, and put a bid at risk.
If your tender price appears abnormally low, you may be asked to prove it is deliverable. If you are the buyer, you must follow a clear, defensible process before you accept or reject it. Get this wrong and the consequences are real: contract failure, challenge risk, and poor value for money.
What are abnormally low tenders?
An abnormally low tender is a bid that appears unusually low compared with the requirement, the market, or the other bids received. It is not about being “competitive”. It is about whether the price looks unsustainable or implausible without compromising delivery, quality, or compliance.
That “appears” point matters. In practice, abnormally low tenders are identified through price realism checks and internal benchmarking. A tender can look abnormally low because the bidder has missed costs, made unrealistic assumptions, or is pricing in a way that shifts risk back to the buyer.
Abnormally low vs simply good value
A low bid is not automatically a problem. Strong suppliers can price sharply because they:
- have efficiencies in their method
- hold advantageous supply chain rates
- use technology or automation to reduce effort
- understand the scope better than competitors
The difference is evidence. A competitive bid is still able to show a coherent cost model and delivery plan. An abnormally low tender usually starts to unravel when you test the numbers against the proposed service.
Common triggers that buyers spot early
These are the patterns that often prompt abnormally low tender checks:
- Rates that are clear outliers against the rest of the market
- Pricing schedules that do not add up or appear incomplete; for example, missing mobilisation, management, travel, or statutory costs
- Resourcing that does not match the method statement: too few people, too few hours, or missing specialist roles
- Unrealistic assumptions on productivity, response times, or service volumes
- Heavy dependence on “future savings” with no credible plan to achieve them
- Supply chain costs that look implausibly low or unverified
- Inconsistencies across sections: a premium service described, but a budget price submitted
This is where both sides benefit from doing the hard work upfront. A buyer can avoid slow clarifications. A supplier can avoid losing momentum or credibility at the crucial stage.
The rules and why they matter
Buyers have legal duties, not just good practice
Under the Public Contracts Regulations 2015 (PCR 2015), where a tender appears abnormally low, contracting authorities are required to request an explanation from the bidder before they can reject the tender for being abnormally low.
From 24 February 2025, the Procurement Act 2023 regime applies to many new procurements. Under that Act, before a buyer can disregard a tender on the basis that the price is abnormally low, they must notify the supplier and give them a reasonable opportunity to show the tender is deliverable.
In other words, the buyer must do more than raise an eyebrow. There has to be a structured process, and a supplier has a clear right to respond.
One practical caveat
In the UK, you can still see procurements running under PCR 2015 where they started under the legacy regime, alongside new procurements under the Procurement Act 2023. So the right approach is to be clear on which rules apply to the specific procurement and build your process and response accordingly.
What buyers must do before accepting or rejecting an abnormally low tender
A defensible approach is consistent across regimes: identify the risk, ask for explanations, assess them objectively, and record the rationale.
Step 1: Identify and document why it “appears” abnormally low
Buyers should be able to point to the trigger. That might be:
- comparison with other bids
- internal cost benchmarks
- market intelligence
- mismatches between price and proposed delivery
This is not about proving the bid is impossible. It is about showing why the bid needs clarification.
Step 2: Request an explanation and set a clear scope
Under PCR 2015 Reg 69, the buyer should request explanations for the price or costs. Those explanations can relate to factors such as the economics of the process, technical solutions, exceptionally favourable conditions, originality, and compliance issues.
Under the Procurement Act 2023, the buyer must give the supplier a reasonable chance to demonstrate deliverability before disregarding the tender for an abnormally low price.
Either way, the clarification request should be:
- specific (what exactly looks low and where)
- evidence-led (what proof is expected)
- time-bound (a reasonable but firm deadline)
- consistent (similar scrutiny for similar issues)
Government guidance on assessing competitive tenders under the new regime also reinforces structured evaluation and transparency in how buyers approach pricing and related risks.
Step 3: Assess the explanation against deliverability, not assumptions
A strong assessment looks beyond the headline price and tests whether:
- the delivery model is credible at that cost
- quality can be maintained (and monitored) at that cost
- risks are properly owned and costed
- the supplier is compliant with employment and statutory obligations
- any stated efficiencies are real and evidenced
Step 4: Decide and record a robust rationale
The output is not just “accept” or “reject”. It is:
- what was asked
- what evidence was provided
- how it was evaluated
- why the tender was accepted or disregarded
- any conditions that must be managed in contract (where relevant)
That audit trail is often the difference between a confident award decision and one that becomes vulnerable under scrutiny.
What suppliers should be prepared to evidence if your price is challenged
If your price is questioned, your job is to demonstrate deliverability quickly, clearly, and with proof. The worst move is to get defensive or vague. The best move is to show your bid is low for reasons you can evidence.
What a “defendable price” response usually needs
1) A clear cost build-up
- labour hours and grades
- day rates or hourly rates
- overhead and management time
- travel, subsistence, and expenses (if applicable)
- materials, licences, and consumables
- margin assumptions
- contingency approach (even if lean)
2) Evidence behind the numbers
- supplier quotes or framework rates
- payroll assumptions, including NI, pension, and any uplifts
- productivity assumptions backed by delivery approach
- tooling or automation that reduces effort, with a realistic implementation plan
3) Alignment between price and delivery
- resourcing matches the method statement
- service levels are achievable within the budget
- governance and contract management are not “free”
- mobilisation is costed and scheduled properly
4) Transparent assumptions
Spell out what you assumed about volumes, locations, start dates, client inputs, exclusions, and dependencies. If the buyer’s assumption differs, address it directly and show the cost impact.
The mistakes that sink low-priced bids
- “We are confident we can deliver” with no cost model
- A spreadsheet that adds up but does not match the written solution
- Unexplained efficiencies or “economies of scale” claims
- Reliance on subcontractors without firm pricing
- No explanation for major outliers in rates or time
This is where bid support makes a measurable difference. Your clarification response is not just a finance exercise. It is a credibility test.
How to reduce the risk of an abnormally low tender challenge
A challenge often happens when pricing is treated as an isolated worksheet rather than part of the bid’s logic. Advice from Thornton & Lowe can help you to build a joined-up story.
Start with a deliberate pricing approach
If you are unclear on whether you are competing on margin, efficiency, or value, your numbers will look inconsistent. To determine the right pricing strategy, stress-test it against the scope, mobilisation requirements, and contract risk profile.
Use market context without guesswork
Buyers will compare you against the pack, even if they do not share the pack. If your price is lower, expect questions. The answer is to know your rationale and be ready to justify it. That starts with calculating your competitors' pricing in a structured way, and using insight to sense-check where you sit.
Treat pricing schedules as part of compliance
If your pricing schedules are incomplete, inconsistent, or misaligned with your narrative, you increase the risk of a low-tender challenge. Build in quality control. Check totals, check units, check assumptions, check that every deliverable is costed.
Align price with the scoring model
Many procurements require trade-offs. If you do not understand how quality and price are weighted, you can accidentally submit a price that looks “too low” for the quality promise you made. Strong bids show the logic of value, not just the maths.
Build capability, not just a one-off response
For many organisations, the root issue is repeatable. Pricing, governance, and evidence should not start from scratch every time. This is where bid writing consultants have a role in setting pricing strategies and building templates and internal standards that make future tenders more consistent.
If you are tightening up your process end-to-end, start with bid readiness so you can spot gaps before a live opportunity exposes them.
FAQs
What counts as an abnormally low tender?
There is no single percentage threshold. It is a tender that appears unusually low relative to scope, market norms, or other bids, such that deliverability is in doubt.
Can a buyer reject a bid without asking questions first?
If a buyer is rejecting because the tender is abnormally low, they must request an explanation and give the supplier an opportunity to respond under PCR 2015 Reg 69. Under the Procurement Act 2023, they must notify the supplier and give a reasonable opportunity to demonstrate deliverability before disregarding it for an abnormally low price.
What evidence is most persuasive when your price is challenged?
A clear cost build-up, proof behind key inputs (rates, quotes, productivity assumptions), and a delivery plan that matches the numbers. Consistency across the bid matters as much as the spreadsheet.
Can suppliers challenge a competitor’s abnormally low bid?
In practice, suppliers may raise concerns during or after a competition, but they will not usually have access to competitors’ detailed pricing. The key is whether the buyer followed a lawful, transparent process and can evidence their rationale for award.
Does the Procurement Act 2023 change the approach?
It reinforces the need for transparency and a reasonable opportunity for suppliers to demonstrate deliverability before a tender is disregarded for abnormally low price, within the broader reforms to UK public procurement.
Get expert support on pricing and clarifications
If you are worried your bid could be challenged as an abnormally low tender, we can help you build a defendable pricing position and the evidence to back it up. If you are a buyer dealing with an unusually low bid, we can support a compliant clarification process and a robust audit trail.
At Thornton & Lowe, we support organisations to price with confidence, respond to clarifications quickly, and make award decisions that stand up to scrutiny. If you want expert support, speak to our team about bid writing, bid management, and outsourced procurement support.
