Government Procurement 101: The Bidding Process And How It Works

Unlike me and you, governments (with few exceptions) can’t simply go to Wal-Mart or the internet to buy their goods and services. At all levels of government, whether federal, state or local, government entities are required by law to ensure that goods and services are purchased in a competitive, open and free environment. 

In order to ensure fair competition, government entities employ the competitive bid process. The process generally has four steps:

1.            Preparing the Solicitation: Governments must first decide which goods or services they wish to purchase. They must decide the general terms and conditions of their purchase. Is lowest price the most important term or are the qualifications of the service provider most important? Once these internal decisions are made, the government entity will draft a solicitation package that will convey all of the information to potential providers of the goods or services that are to be solicited.

2.            Notification: Governments must notify the general public that they intend to purchase a certain good or service. In order to do so, governments will often advertise the solicitation on their own website, in local newspapers, in trade publications and/or specific internet based notification sites. The notification will identify the good or service that is to be purchased, provide certain deadlines, identify a method to obtain more information or ask questions, identify the point of contact for the solicitation and whethter there is a pre-bid meeting. The notification will also tell you whether the solicitation is a Request for Proposal (RFP), Request for Qualifications (RFQ) or an Invitation to Bid (ITB). (Described more fully in another article). They will also explain how you can obtain a copy of the full solicitation.  Since the complete solicitation is usually many pages long they are rarely (if ever) published along with the notification.  

3.            Opening: A very important part of the solicitation process is the opening of bids. The solicitation document will provide a certain deadline for you to provide your response to the solicitation. At the designated time and place, the government entity will open all bids received and identify all of the bidders who responded. All responses to the solicitation must be received by the deadline or they will not be accepted. There is rarely an exception to this rule. The government entity that accepts a late bid risks a bid protest from those proposers who got their documents in on time.

4.            Evaluation process: Once the responses to the solicitation are received, the government entity will evaluate them. The evaluation process differs based on the government entity. The first step in the evaluation process is determining whether the bidder was responsive and responsible.

a.            Responsiveness: In the simplest terms, a bid is responsive if it provides all of the information that the government entity requested. A bid is responsive if information that was requested is not provided. This evaluation is usually pretty strict and the consequences often very harsh. Failure to sign a form or failure to include a certain document or form can result in the entire bid being rejected.

b.            Responsibility:  The responsibility review answers the question, “can this bidder perform this contract”? If the bidder shows a history of failing to perform on previous contracts, or completing projects late, the bidder can be found to be non-responsible. Certain criminal convictions, other infractions and/or lawsuits by or against the bidder can also render the bidder non-responsive.

Once bidders are found to be responsive and responsible, the government entity will convene a selection committee, comprised of employees and/or others, who will evaluate the responses based on criteria that was listed in the solicitation document. The selection committee will often use a formal tabulation process whereby points are awarded for various criteria and the bidder with the greatest (or lowest) number of points is declared the winner.

5.            Making the award: Once the evaluation process is concluded and the bidders are ranked, the highest ranked bidder will be awarded the contract. The winning bidder will normally be notified of the award by telephone, email or letter. Sometimes awards are announced at a public meeting. Once the contract is awarded, the winning bidder must either enter into a contract with the government entity or negotiate a contract. Oftentimes the contract is included in the solicitation document so the bidder knows the terms of the contract in advance. A less common scenario occurs when the government entity attempts to negotiate a contract after award.

As you can see, there are many steps in the bidding process. If you have any questions or concerns you should contact a professional,  like the attorneys at Kleiner & Cazeau, that have the experience helping companies navigate the bidding process.

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The Government Contract Attorneys at Kleiner & Cazeau are experienced and available to help you with your government contract issues.

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