Advertising is when a company goes out for sealed bids. There are no negotiations. Competitive market forces determine the price and the award goes to the lowest bidder.

Negotiation is when the price is determined through a bargaining process. In such a situation, the customer may go out for a:

• Request for information (RFI)

• Request for quotation (RFQ)

• Request for proposal (RFP)

The RFP is the most costly endeavor for the vendor. Large proposals contain separate volumes for cost, technical performance, management history, quality, facilities, subcontractor management, and others. The negotiation process can be competitive or noncom-petitive. Noncompetitive processes are called sole-source procurement.

On large contracts, the negotiation process goes well beyond negotiation of the bottom line. Separate negotiations can be made on price, quantity, quality, and timing. Vendor relations are critical during contract negotiations. The integrity of the relationship and previous history can shorten the negotiation process. The three major factors of negotiations are:

Project Management Made Easy

Project Management Made Easy

What you need to know about… Project Management Made Easy! Project management consists of more than just a large building project and can encompass small projects as well. No matter what the size of your project, you need to have some sort of project management. How you manage your project has everything to do with its outcome.

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