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Chapter 9 - Determining Fair and Reasonable Pricing

9.3 Other price evaluation factors

There are other price-related factors that need to be considered when determining the price to be used in evaluating a supplier's proposal or bid. Some examples include:

  • Multiple awards or the costs associated with awarding multiple contracts.
  • Logistical support requirements including maintenance, warranty protection or repair, training, installation, technical manuals, spare parts and supplemental supplies. Request prices for all such services needed either on a per-service basis, package basis or some combination.
  • Life cycle costing including expected life, salvage value, discounted total cost of ownership. Select life cycle costing for equipment with an expected life greater than one year if there are sufficient data, from market research.
  • Economic price adjustments based on projected and historical data.
  • Transportation and/or shipping costs.
  • Packaging and marking costs.
  • Lease versus purchase costs. Perform an analysis to determine which is of greater overall value based on ownership, support and maintenance and life-cycle needs.
  • Options and/or multiyear costs. Sometimes alternate pricing is available if your agency is willing to contractually commit up front to an extended base term and/or minimal out-year support and maintenance terms; however, there are many project and/or budgetary considerations that must be taken into account with state agencies.
  • Incremental pricing or quantity discounts.
  • Energy conservation and efficiency criteria.
  • Estimated quantities.