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Competitive RFP for FFP - Split Award


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On 6/4/2024 at 1:36 PM, DawnS said:

Two suppliers were sent a competitive solicitation for an FFP Best Value criteria award.

Did I miss it or did some ask, and it was answered - Is this a commercial product?   I am wondering because  "supplier".

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1 hour ago, DawnS said:

What was unclear to me was within a competition with only two competitors that awarding to the one that was not the evaluated winner would negate the exemption or not.

The exemption from submission of cost or pricing data doesn’t mean that the prime doesn’t have ensure that the subcontract prices are fair and reasonable, especially if the second firm’s prices are significantly higher than “the winner’s” prices for the same effort or products. Of course differences in non-price (e.g., technical approach)  could affect prices…

The exemption is only applicable to certified cost or pricing data, not “data other than certified cost or pricing”. 

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27 minutes ago, C Culham said:

Did I miss it or did some ask, and it was answered - Is this a commercial product?   I am wondering because  "supplier".

Ah, good catch, Carl. I missed it and nobody asked.

Even if the subcontract is for a commercial product or commercial service, my previous comment is applicable and the prime isn’t bound to simply accept the second “supplier’s” prices because they were based upon competition. 

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I would be concerned with the previous comment regarding negotiating with either of the suppliers because negotiated procurements  can be viewed as not exempt from cost or pricing data.

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21 minutes ago, Neil Roberts said:

I would be concerned with the previous comment regarding negotiating with either of the suppliers because negotiated procurements  can be viewed as not exempt from cost or pricing data.

Competitively negotiated procurements with adequate price competition (or commercial products or services) - as discussed here- would generally qualify for an exemption from submission of certified cost or pricing data. I often conducted price discussions in competitive acquisitions. At the most I might occasionally ask for some “data other than certified cost or pricing data”. 

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48 minutes ago, Fara Fasat said:

Carl - why would negotiations negate the exemption for either commercial items or adequate price competition?

Fara, Carl didn’t suggest that…

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17 hours ago, Fara Fasat said:

why would negotiations negate the exemption for either commercial items or adequate price competition?

 @Fara Fasat, my statement was made regarding an earlier comment in this thread by Joel that was not specific to commercial items, and neither was my comment. With respect to a prime contractor awarding a "negotiated contract" after solicitation responses resulted in adequate price competition, I find that to be a slippery slope. Negotiated contracts are subject to cost of pricing requirements per FAR 15-403-4...if your award changed specific solicitation requirements, it may be viewed that adequate competition was adversely affected and, been unfair to other bidder(s). As a prime contractor, even using the terms "negotiated contract" for an award over the cost or pricing data threshold tends to invite Government scrutiny and questions where you are not complying with cost or pricing data requirements.       

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10 hours ago, Neil Roberts said:

 @Fara Fasat, my statement was made regarding an earlier comment in this thread by Joel that was not specific to commercial items, and neither was my comment. With respect to a prime contractor awarding a "negotiated contract" after solicitation responses resulted in adequate price competition, I find that to be a slippery slope. Negotiated contracts are subject to cost of pricing requirements per FAR 15-403-4...if your award changed specific solicitation requirements, it may be viewed that adequate competition was adversely affected and, been unfair to other bidder(s). As a prime contractor, even using the terms "negotiated contract" for an award over the cost or pricing data threshold tends to invite Government scrutiny and questions where you are not complying with cost or pricing data requirements.       

In this case there is no stated change to the terms of the solicitation.

The prime contractor can negotiate or bargain for better price and/or performance with one or both of the proposed subs if that is company practice. If there is adequate price competition or the equipment is determined to be a commercial product it would generally be exempt from the requirements to submit cost or pricing data and to certify it.

Beyond that I don’t see any need here  for CCOPD.

If the government wants to increase its supplier base and if there is a wide variance in prices and/or differences in proposed quality of performance, it would unwise* to simply offer an award without bargaining for improved prices and/or performance

*poor business practice - AKA stupid business decision.

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Since the original poster asked about the need for certified cost or pricing data, I suspect that they may have been thinking of negotiating or bargaining for better terms or performance or price for the alternate supplier. At least I hope so. 

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7 hours ago, joel hoffman said:

If the government wants to increase its supplier base and the is a wide variance in prices and/or differences in proposed quality of performance, it would unwise* to simply offer an award without bargaining for improved prices and/or performance

*poor business practice - AKA stupid business decision.

The poster did not seem to say anything about the price of the other bidder having a wide variance, or quality or performance deficiencies. Did I miss something? 

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10 hours ago, Neil Roberts said:

The poster did not seem to say anything about the price of the other bidder having a wide variance, or quality or performance deficiencies. Did I miss something? 

I said “if”. More than once…

Why is the original poster asking about a need for certified cost or pricing data?

What would be the purpose of obtaining cost or pricing data if it was necessary?

For this best value competition the prime should have and did already evaluate both non-price and price factors (“categories”).

The declared “winner” had the “best scores” in all categories (schedules, past performance and price).

The “program” wanted to also award a subcontract to the “non-winner” for a 25% share of purchases.

The non-winner’s prices, schedule and past performance werent good enough to “win” the competition but the program wanted to give the firm 25% of the sales. Wouldn’t the program office want to get a better deal than was initially offered - if there were significant differences in non-price and/or price categories?  

It would be apparent to me that cost or pricing data would supposedly have been used for negotiating prices, if it had been required for that purpose.

The prime wouldn’t need cost or pricing data to bargain with the firm or either firm for that matter.

By the way, I didn’t mention or hint that the second firm had “performance deficiencies.”

 

 

 

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