Sealed Bids vs Competitive
Sealed Bids vs Competitive
Sealed bidding and Competitive Proposals have their advantages and disadvantages for private contractors. The government offers the opportunity to contractors to place their bids depending on the specifics of the job or the contract requirements then the government will choose the channel which they will send the solicitation through. For Sealed Bidding is an Invitation for Bids and for Competitive Proposals bids are two ways of solicitation, a Request for Quotation and Request for Proposals (Murphy 2009).
An advantage for contractors that are bidding through Sealed bidding is that they are not obligated to provide any information on cost or the profit to justify their bid price. The government has no control over that part and will have to rely solely on the price competition without having all the facts to know if the bid is a reasonable one. This can be a great advantage in making a higher profit if the contractor’s cost for the project is low. Another advantage is that there are no negotiations before, through the period of evaluation or after. There are no individual discussions with any bidder during the process, and no price discussions occur” (Murphy 2009, p. 18). Competitive Proposal advantages for contractors can occur when the government uses a tradeoff.
Even though a tradeoff is used by the government when they feel it is to their benefit, it can also be advantageous for a contractor because if chosen the contractor once again does not have to be concerned with the cost or price and still be the one with the higher bid. This process permits tradeoffs among cost or price and noncost factors and allows the government to accept other than the lowest priced proposal” (Murphy 2009, p. 21). The difference with this approach is that the government can either arrange to have a discussion with the contractors or simply make their decision without holding a discussion. When the government chooses to hold a discussion they will select the proposals from those contractors that were in the competitive range.
Then the government will have discussions with these contractors in which they can review their proposal, make adjustments and resubmit a new proposal. Although discussions are offered in some cases the government may opt to make their decision without a discussion or the change for contractors to review and change their bids (Murphy 2009, p. 21).
The advantage would be for those contractors that were given the chance to make adjustments to their proposals which based on their discussion could be closer on making the final award. The two contracting methods have advantages for contractors but in my opinion the Sealed bidding is a less extensive process for both the government and the contractor. From the contractor’s perspective I would prefer the Sealed bidding for the fact that there are no extra requirements to prove costs and price.
University/College: University of Arkansas System
Type of paper: Thesis/Dissertation Chapter
Date: 2 November 2016
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