ABSTRACT
Chapter Objectives This chapter provides readers with an introduction to the topic of competition in contracting, disadvantages of sole source contracts, challenges to and benefits from embracing competition, rationale for establishing a dollar threshold where sole source justification is required, as well as situations that do and that do not justify sole source contracts. The readers are also introduced to socioeconomic contracting programs and equal opportunity techniques for developing a successful socioeconomic contracting program. The equal opportunity techniques discussed include:
Establishment of an incentive awards program ◾ Motivational training for contracts professionals ◾ Encouragement by managers to use targeted companies ◾ Agency participation in a supportive organization ◾ Establishment of rapport with targeted companies ◾ Provision of direct assistance to targeted companies ◾ Promotion of internal networking ◾ Incorporation of program support as a part of employee job responsibility ◾
2.1 Introduction to Competition in Contracting State and local government agencies have a reputation for purchasing through the use of Invitations for Bids (IFBs) wherein the lowest-priced responsible contractor or supplier providing a responsive bid is selected. Elected and appointed officials, as well as the constituency, normally insist on competitive procurements to ensure that excessive amounts are not paid from tax revenues and that favoritism is not a factor in the selection of contractors. However, the IFB type of solicitation used in full and open competition is normally reserved for the purchase of commodities or for construction contracts. In rare cases, state or federal grants require competition through the use of an IFB for services contracts. Granting agencies, in such cases, normally provide an IFB template and guidelines for use of the IFB by the contracting agency. Solicitations for services contracts, other than in the preceding unusual situations, are normally conducted through use of Requests for Proposals (RFPs) wherein the resultant contract is awarded based on both price (or life cycle cost) and other factors. Occasionally, such service contracts are awarded on a sole source basis or with limited competition. The first portion of this chapter is devoted to the merits of and recommendation for using RFPs in full and open competition for services contracts.
