Contract awarding is the method used during a procurement in order to evaluate the proposals ( tender offers) taking part and award the relevant contract. Usually at this stage the eligibility of the proposals have been concluded. So it remains to choose the most preferable among the proposed. There are several different methods for this, which are obviously related to the proposition method asked by the procurement management.


Least price

This method is the simplest and oldest of all. Under this the procurement contract is awarded to the best price. Some relevant methods are these of examining the overall or in parts and in total discount in a given price list or on a given budget. One of the proposed for Public tenders by the EC.

Most economically advantageous

This is applicable to proposals of different quality within the limits set. Under this the proposals are graded according to their price for value and the contract is awarded to the one with the best grade. Similar to this is the grading of the proposals according to time, making the proposals needing less time of implementation seem more valuable. One of the proposed for Public tenders by the EC.2004/18/EC article 53§1a Directive on the coordination of procedures for the award of public works

Mean value

The contract is awarded to a bid closer to the mean value of the proposals. This may apply to procurements where numerous proposals are expected and there is a need for a market-representing value.https://docs.google.com/viewer?a=v&q=cache:CqYPIPindWUJ:faculty.kfupm.edu.sa/CEM/bushait/Research/Bid-awarding-systems-An-overview.pdf+bid+awarding&hl=en&gl=gr&pid=bl&srcid=ADGEESibn36p3prl52ZmY2gy2gi8Rq3RlbzBfw6nq1orsyjQxPqYOH7idi-YQcji4IVdIoMsDx_H9lc8yZ7P5hB6rgDYeoAp-kHN_SQ7Uwzf6qSUw1K3bndY22EeoPehb-UPu_i_B4IX&sig=AHIEtbQn8TVyZu7SORNqDnOmLXj5BCsfmA Bid awarding systems - an overview

Exclusion of the extremes

Under this method the proposals that are deviating the most from the mass of the proposals are excluded and then the procedure continues with one of the above methods. There are also many variants and/or combinations of these main methods.

See also

Contract A contract is a legally enforceable agreement between two or more parties that creates, defines, and governs mutual rights and obligations between them. A contract typically involves the transfer of goods, services, money, or a promise to tr ...
* Contract theory *
Government procurement Government procurement or public procurement is the procurement of goods, services and works on behalf of a public authority, such as a government agency. Amounting to 12 percent of global GDP in 2018, government procurement accounts for a sub ...
Public works Public works are a broad category of infrastructure projects, financed and constructed by the government, for recreational, employment, and health and safety uses in the greater community. They include public buildings ( municipal buildings, s ...
* Tender offer * Contract Management



External links

European Commission - Public Procurement
Law and economics Government procurement