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Brian Johnson

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  1. Thank you all for the input. The item is an electrical component that goes on an aging aircraft. I wish we could allow the marketplace to redevelop this item but due to data restrictions and the Special Programs Office (SPO) desire not to reverse engineer this we are left with one vendor. So I understand that the contractor has leverage and can offer whatever price they want. It is still my responsibility to determine the price fair and reasonable (i.e. maybe we pay a premium because of the risk, or because the contractor is going out of there way to supply the item, but the fact still remains I need to understand why we are paying that price). My main concern is with the NRE as I feel I can support the production costs. I have looked to see if I could separate the NRE out as Non-commercial as stated in the above posts but upon reflection and consideration of the regs I don't believe the NRE efforts can be considered non-commercial. The more I have looked into this and talked with others in my office I believe the contractor is trying to hide the fact they have some exorbitant overheads and profit built in. Vern - I liked the idea about sending a letter to a Sr. Executive. At this point I believe that is all I can do. Thanks again to all of you!
  2. Thanks Patrick! I do work for a govt agency but your information aligns with much of what I have done and believe.
  3. I am working a Firm Fixed Price buy for a sole source item that has been determined commercial of a type. Because of obsolescence the part has to be redesigned (last bought in the 90's). The redesign effort involves NRE costs that are beyond the actual production costs and the contractor is only providing hours and a burdened rate for each labor category to support this NRE. I have backed into the numbers the best I can but my counter offer is less than half of the proposed price for NRE. The NRE total is for $850,000. Without more data I am at a loss. The contractor keeps claiming because this is a commercial buy they won't support their price with more data. Do I have any options to persuade them on the front end? What if I end up negotiating a price I am uncomfortable with to ensure supportability to our customer. Is there something I can do Post Award to validate the price or uncover their true cost so we can use that data on similar buys our office is working.
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