• KSCE Journal of Civil and Environmental Engineering Research
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• v.26 no.5D
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• pp.849-859
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• 2006

Earnings of domestic enterprises are expected a serious damage because the lowest cost bid system and the current cost estimate system. In 2005 average successful bid rate for the lowest cost bid project is below 60%, this is not reach at the operating budget of enterprise. Many problems such as illegal construction, low price subcontract, chain enterprise loss com in to practice because of low successful bid rate. In addition earnings of the enterprises expected to be the minimum, because of enlarge execution of the current cost estimate system. This study tries to lend assistance by giving alternative for the construction enterprise by presenting the bid system, investigate and compare foreign system with domestic and analyze correlation of the lowest cost bid and the current cost estimate system.

• Proceedings of the Korean Institute Of Construction Engineering and Management
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• 2006.11a
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• pp.632-637
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• 2006

Our country's bidding system had made the lowest price successful bid system in foundation before introducing eligibility review system at July, 1995, and a averaged- price successful bid system or the restrictive-lowest price successful bid system had been enforced by repletion. However, they were introduced as dumping that do not reach in direct cost level of construction cost is generalized and worry about illegal construction practices rises by the lowest price successful bid system. According as they had not been promoted construction company's technical development effort or cost reduction effort, vicious circle that advocate competition principle again and recur as the lowest price successful bid system is repeated last 50 years. Therefore, I present improvement direction that can satisfy all Global Standard and real condition of our country through foreign countries example analysis to cope with the rapidly changing building circumstances socially and economically to correspond actively to the construction industry's reorganization to reconsider domestic construction engineering's competitive power.

• Proceedings of the Korean Institute of Building Construction Conference
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• 2015.05a
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• pp.111-112
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• 2015

Garak Market Modernization Project Phase 1, which is the public projects worth 1,75 billion won, was delivered by adopting modifiable bid of BOQ on the lowest price award system. The modifiable bid of BOQ system allows bidders to modify quantities based on their own drawings and construction specifications and requirements. It was initiated by the government for minimizing design error and for inducing technical competition between tenders by checking errors. At that time the bidding, it allowed modifying the BOQ all the works. In the construction phase, the responsibility for the design changes, due to mistakes and omissions on design documents and BOQ were disputed between the owner and the contractors. This study analyzed the problem of the system and addressed a need of improvement.

• KSCE Journal of Civil and Environmental Engineering Research
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• v.26 no.6D
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• pp.975-983
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• 2006

This study analyzed bidding data for construction projects ordered by the Public Procurement Service under the lowest bidding system since 2001 by using statistical technique in terms of construction types, company sizes, bidding prices. This study brings out construction company's bidding practices and problems caused by the current lowest bidding system and suggests the way to mitigate the problems and to improve the lowest bidding system. The analysis shows the problem of winning a bid in abnormally low price under the lowest bidding system, feared at the start, was realized. As bidding practice has polarized with low and high price, the analysis shows that the lowest bid system's market has a high possibility to be distorted by construction companies' bid strategies. To complement the lowest bidding system's problem, the analysis shows that introduction of the bidding system using particulars where bidders estimate construction quantities and unit prices by themselves is needed.

• Proceeding of Spring/Autumn Annual Conference of KHA
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• 2009.04a
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• pp.211-216
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• 2009

Bidding systems in the domestic public construction work have been amended many times since the lowest-bidding system was implemented in 1951. However, this hasn't had much success. Competition in technical development among companies has declined as the contracts for buildings are given to company which submits the lowest price without considering traits of projects. In addition, as the construction market turns to the limitless competition system due to FTA(Free Trade Agreement), advanced techniques are needed to promote the national competitive power. Considering the needs of the times, Korean government announced that "Best Value Contract (Design-Bid-Build)" and "Bridging Contracts (Design-Build)" are included to 4 existing bidding systems in October 2007. Thus this study aims to suggest devised the evaluation criteria including major items for evaluating bidders, in order to establish and revitalize the best-value bid system successfully.

• Korean Journal of Construction Engineering and Management
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• v.19 no.3
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• pp.52-60
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• 2018

Korea's public construction projects are under construction through bidding, however, due to the nature of the bidding, collusion between participants can occur. The collusion of bids accordingly damages the client. So, it is necessary to calculate the appropriate fictitious competition price to compensate for this. In this regard, econometrics methods are generally used, but there are limitations and issues arising from the nature of construction, especially design-build bid. Therefore, this study proposes a method to estimate reasonable competitive bid-price in design-build bid. It derives the lowest bid-price from the design submitted by the proponent and estimates the competitive bid-price by examining the factors according to the penetration rate according to the technical level of the tester, the skill level of the competitor, and the type of tester. Based on the method proposed in this study, a reasonable price can be derived that reflects the characteristics of the design and construction bidding bidder selection method and also it can be used as a reference material in the actual bidding process as well as calculating the damage due to the answer.

• Journal of the Korea Institute of Building Construction
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• v.12 no.6
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• pp.682-700
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• 2012

Over the last several years, Korea has increasingly adopted design-build for public construction projects. There is a much greater awareness of the need to change to a system based on 'Value for Money', which is high on the government's agenda. A whole life performance bid evaluation model is proposed to aid decision makers in the selection of a design-builder. This is based on the integration of a framework using an analytic hierarchy process, as the bid awarding system is being changed from one based on the lowest price to one based on best value over the life-cycle. Key criteria such as whole life cost, service life planning and design quality are important through the key stages of the evaluation process. The model uses a systematic and holistic approach, which enables the public sector client to make better decisions in design-builder selection, which will deliver whole life benefits based on long-term cost-effectiveness.

• Korean Journal of Construction Engineering and Management
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• v.6 no.5 s.27
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• pp.102-109
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• 2005

The contract price of successful bidders in domestic public work projects has dropped significantly under lowest bidding process. Furthermore, compared to the U.S. and Japan, the bids are substantially lower. The increasing trend for domestic construction companies to bid projects without considering markup or expected profit, with the purpose of gaining experience for future similar work, has contributed to the overall dumping in bid prices. The government has implemented controls in hopes of reducing the price dropping trend but these have yet to work in the market. This study determines the level of significance of the contract price of the successful bidder in domestic public works projects and identifies factors that cause bid-dropping by comparing to those of the US and Japan. By mirroring advance countries' rules and regulations to prevent an abnormally low bidder, recommendation are provided to keep unrealistically low bidders from winning the work.

• Korean Journal of Construction Engineering and Management
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• v.11 no.2
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• pp.94-105
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• 2010

Recently, resettlement problems of low income groups in the urban regeneration area have been issued in Korea because they have no capability to purchase (or lease) redeveloped housing (or apartment). There are several approaches for supplying affordable housing and one of these is the bidding system which can reduce construction cost. However, the lowest bidding system has many problems such as dumping and substandard quality. In this context, this study proposed bidding system based on technical proposal applying the concept of the lowest total combined bid price for optimization of bid price, reduction of construction cost and period, and maintenance of suitable quality. This bidding system embraces the best value and cost plus time concept on the basis of an improved lowest price bidding system. It consists of the following components: work unit based, project unit based, and period reducing technical proposals. The proposed bidding system for determining bidders are designed to evaluate the adequacy of each technical proposal in the order of the combined minimum price in an effort to effectively optimize bid prices and reduce the construction periods, as well as to maintain a minimum appropriate quality.

• Proceedings of the Korean Institute Of Construction Engineering and Management
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• 2007.11a
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• pp.267-272
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• 2007

In the construction industry government is not only an owner but also a consumer. Accordingly it should develop the construction industry and this role is important. Among them, the law of the ordering method is standards of selecting a successful bidder and have powerful influence over the construction industry and owners. Therefore this study said how the lowest bid method, which has taken effect still more, has influence on the construction industry and the public sector with the Causal Loop Diagram. According to analyzing this construction law, we can grasp the point of the strength and weakness of this law also examine a trend of how the present law is changed. While we studied, we tried to adhere to neutrality and form a new opinion about it because the previous studies were opposed to each other. As a result, to improve the relation between the government and private company, which were opposed to each other about arguments for and against the lowest bid method, this study suggest the method of making better the relation. The final goal of it is researching the inefficient factors and improving the weakness of this law.