Negotiation with bidders, Financial Management

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Negotiation

You can also negotiate with the bidders based on the requirements as mentioned below.

You can negotiate only with the lowest evaluated responsive and qualified bidder. Normally, you should not negotiate, as this sets a bad precedent for the bidders, who then initially raise the prices and may reduce the prices marginally on negotiations, which may still be more than the reasonable costs/prices. Thus, negotiations may lead to corruptive practices. However, negotiations may have to be conducted under the following circumstances:

  • When you find that the lowest evaluated responsive and qualified bid for works or for items of goods are substantially more than the updated cost of works or items of goods.
  • When the procurement for works or goods is of an urgent nature and rejection of bids and re-invitation of fresh bids will adversely affect the schedule for completion of the project.

The Chief Vigilance Commissioner, GoI has issued detailed guidelines4  on the circumstances under which negotiations could be conducted. GoK has also issued detailed guidelines as well as mentioned the procedure that has to be adopted for conducting negotiations.


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