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Some Pitfalls of Low Bids, by Corinne Maddox, CCM, CFM

Many basic products and services are awarded based on low bid. Generally, the low bid should be considered "apparent low bid" until further review. There are 3 significant areas to review.
  1. Look for exceptions or exclusions to the bidder's price. To get an "apples to apples" comparison, the value of those items should be added to the bid price. This may result in a different low bidder.
  2. Review the bid breakdown of all the bidders. When a line item of the low bidder is substantially different than other bids, they have probably made an accounting mistake or left something out. Before awarding, the bidder should be asked to review their price for errors, and the scope of the questionable work should be clarified.
  3. Many bid packages require pricing of alternates that substantially increase or decrease the price. Sometimes voluntary alternates are included in bids which may not be acceptable to the owner. Determine the alternate(s) that you will accept and include those for all bidders, requesting additional pricing as needed.

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