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Key Strategies for a successful Competitive Bid Analysis When Awarding an RFQ

Key Strategies for a successful Competitive Bid Analysis When Awarding an RFQ

Analyzing Vendor Bids

The final stage of any Request for Quote (RFQ) or Request for Proposal (RFP), is the process of awarding the contract to the successful bidder. A key part of this stage is when the buyers collect all the information together to compare the various bids, along with the technical & commercial details of each.  This can be a challenging and time-consuming process if your buyer team doesn’t have the right tools to help perform that task.

What is a Commercial Bid Analysis?

The purpose of the Competitive, or Commercial Bid Analysis (CBA) undertaken by the procurement team is as follows:

  1. Allow buyer/evaluator to see all the bid information in a standardized format so they can be easily compared
  2. Quickly identify any important commercial or technical details that are missing or vaguely provided from a bidder
  3. Enable the Buyer to utilize their expertise by providing a platform to analyze potential risks
  4. Give the Buyer sufficient side-by-side comparative information so that they may give a recommendation and explanation on which bidder to choose

Overcoming Bid Analysis Challenges

One of the greatest challenges to the buyer team in performing this task, is in gathering the tremendous amount of information that has to be collected for the CBA – and then organizing it into a format for easy comparison. If this data gathering exercise is being done manually, it’s very likely that the procurement team is suffering some significant productivity challenges. The procurement teams that have implemented a procurement management system that includes a powerful RFQ module and CBA sub-module on the other hand, will leave most of the time-consuming grunt-work to the software system, so that they can focus on the high-value work of actually analyzing the bids. This not only streamlines the bid evaluation process, it also significantly improves the accuracy of picking the best vendor – or vendors – to be awarded the bid.

The CBA is also instrumental in allowing different Specialists involved in the project – such as Engineers, Project Managers, Project Controls, etc. – to quickly understand the core bidding details in each bid without needing to open and go through each bid package. This saves a huge amount of time for each member of the overall team.

The CBA is also key for issuing the award recommendation results to outside stakeholders – such as the client.

Bid Award

Once the vendor is chosen, the act of converting that RFQ/RFP into a Purchase Order is another area where a procurement management system will be instrumental in easily facilitating that transition. Especially if more than one vendor is chosen; each receiving a partial Award of the work or supply.  

The Commercial Bid Analysis is a critical stage of the overall tendering process, so warrants the appropriate tools and process to ensure it’s performed consistently, accurately and efficiently for the procurement staff.

Procurement Management Software

The screenshot below shows the 4castplus RFQ module with the CBA subsection highlighted.

CBA screenshot.png

By Michael Wilson | May 03, 2017 | Categories: bid evaluation software, engineering procurement software, procurement management software, procurement software | 0 Comments

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