What the Heck is Best Value, and Why Should I Care?
What the Heck is Best Value, and Why Should I Care?”
Best Value is similar to ‘Life Cycle Cost/Analysis’ or ‘Total Cost of Owner-ship,’ however, evaluation components may not include the same features—warranty, fuel use, etc. All evaluation components must be stated in the bid specifications, may not be capricious or arbitrary, and must be applied equally to all responses. The bid must include the following or similar statement: “Any award made as a result of this bid will be determined through best value analysis.” The evaluation criteria to determine best value are listed below in order of importance— most to least.
Best value may include:
- Bidders reputation and that of the goods/services sought
- Past relationship with bidder
- Total Cost of Ownership
- Repair facilities
- Distribution centers
- Other relevant criteria (delivery, availability, payment options—p-card, etc.)
*For evaluation purposes, cost should average half of available evaluation points. If it doesn’t make sense to use half of available points for evaluation, using an RFP should be considered instead.
Best value is not as subjective as it sounds. Evaluation criteria must be measurable in the same fashion as RFP evaluation is measurable. If you use ‘Multiple Criteria Award’ 1 in place of best value, it is clear the process is not subjective at all. If you are unsure what factors may be applicable to your bid, ask a co-worker or supervisor or the purchasing department for assistance. Best value is not a replacement for the RFP, rather it’s an option. 2 (Best value does determine end result, while the RFP allows for creative response by bidders. The evaluation team is responsible for determining which response is in the best interests of the agency.)
Best value may be used for all purchases, regardless of cost. Best value is an excellent tool and should be kept in your “purchasing tool-box” to use as you see fit. There are several publications available for purchase through the National Institute of Governmental Purchasing (NIGP). If you would like a listing or want to buy one, please let us in purchasing know, and we will render whatever services are necessary to procure the books for you.
Purchasing is a readily accessible renewable resource. Try and use us up!
- 1 Courtesy of Jon Bischetsrieder, City of Santa Clarita, CA.
- 2 Jennie Readey, CPPO, Colorado Department of Transportation
Editor’s Note: Bruce Hartmetz, CPPB, is a buyer for the City of Northglenn, CO, and member of the GPRO Editorial Advisory Board.
Hartmetz has written a series of short, conversational articles to explain key elements of the city’s purchasing procedures. Intended as a 3-panel pamphlet, Hartmetz hopes the small size will encourage city management, city council, engineers, architects, project managers, and procurement folks to take a look.
Turn to page 32 for the second in the series, “Writing Your Request for Proposal Right!” Look for “A Guide to Contracting for Services” in the December issue of GPRO.