Best value procurement (BVP) is a

procurement Procurement is the method of discovering and agreeing to terms and purchasing goods, services, or other works from an external source, often with the use of a tendering or competitive bidding process. When a government agency buys goods or serv ...

system that looks at factors other than only

price A price is the (usually not negative) quantity of payment or compensation given by one party to another in return for goods or services. In some situations, the price of production has a different name. If the product is a "good" in the ...

, such as

quality Quality may refer to: Concepts *Quality (business), the ''non-inferiority'' or ''superiority'' of something *Quality (philosophy), an attribute or a property *Quality (physics), in response theory * Energy quality, used in various science discipl ...

and expertise, when selecting vendors or

contractors A general contractor, main contractor or prime contractor is responsible for the day-to-day oversight of a construction site, management of vendors and trades, and the communication of information to all involved parties throughout the course of ...

. In a best value system, the ''value'' of procured goods or services can be simply described as a comparison of costs and benefits. A contractor or vendor is thus selected through a process of researching the vendors or contractors before a detailed project plan is made."University of Alberta Transforms RFPs from Reactive to Proactive."
The Legal Edge, n.d. Web. 30 Apr. 2013. Although BVP is a new procurement method, it does build on procuring and tendering according to the MEAT principle (most economically advantageous tender). The principle enables the contracting authority to take account of criteria that reflect qualitative, technical and sustainable aspects of the tender submission as well as price when reaching an award decision. The BVP approach is based on the conviction that minimizing risks or eliminating risks when allocated information is effectively used for a proper choice. This means the more information that is available and the better it is utilized, the better the future can be predicted and the fewer decisions or risks have to be made. BVP is based upon

natural law Natural law ( la, ius naturale, ''lex naturalis'') is a system of law based on a close observation of human nature, and based on values intrinsic to human nature that can be deduced and applied independently of positive law (the express enacte ...

. Rather than changing and manipulating people, one can understand the nature of transactions which then can be anticipated on using expertise to a maximum, with minimum risks and maximum value as a result. Typically values are assigned to factors such as price, past performance, schedule, and vision. These values are tabulated for each potential vendor or contractor and one will come out on top.

Benefits of BVP

This system is claimed to be beneficial because it needs less decision-making, prepares for the future, and minimizes risk. Even if risks occur, they can be effectively controlled or managed. One of the most important aspects of best value procurement is looking at past performance. It has a vision and method for procuring and tendering in which the main focus is not price, but the performance of market parties. If a client is looking to build a five million dollar building, it is important to see if potential vendors have completed projects on such a scale. This will prevent clients from selecting vendors based on a low bid. Best value procurement is allowed for US federal government projects under the

Federal Acquisition Regulation The Federal Acquisition Regulation (FAR) is the principal set of rules regarding Government procurement in the United States,. and is codified at Chapter 1 of Title 48 of the Code of Federal Regulations, . It covers many of the contracts issued b ...

and 10 USC § 2304.

Uses of BVP Around the World

The BVP system was developed in the

United States The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country primarily located in North America. It consists of 50 states, a federal district, five major unincorporated territori ...

. This system has been practiced in many projects in the US as well as in other countries, such as the

United Kingdom The United Kingdom of Great Britain and Northern Ireland, commonly known as the United Kingdom (UK) or Britain, is a country in Europe, off the north-western coast of the European mainland, continental mainland. It comprises England, Scotlan ...

and

the Netherlands ) , anthem = ( en, "William of Nassau") , image_map = , map_caption = , subdivision_type = Sovereign state , subdivision_name = Kingdom of the Netherlands , established_title = Before independence , established_date = Spanish Netherl ...

. In the Netherlands, BVP is known as "prestatie inkoop," which translates as "performance procurement."

Choosing factors for BVP

The process of choosing the factors to guide procurement toward best value has three stages: identifying the possibilities, choosing relevant factors, and assigning values, or "weights".

References

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External links

vbpcommunity.eu
Procurement