Competitive Bidding: Deciding the Best Combination of Non-Price Features

Simmonds, K. R.

doi:10.1057/jors.1968.20

Cited by 16 publications

(5 citation statements)

References 2 publications

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“…In contrast with the construction industry's devotion to the traditional method (Palaneeswaran and Kumaraswamy, 2000;Wang et al, 2006), selection of the best price-quality bidder has been promoted for a long time, with early work dating back to 1968 (Simmonds, 1968). This involves also taking non-price or technical/ quality factors into consideration in obtaining an optimum outcome for the contracting authority, the owner or the auctioneer (Wang et al, 2013), i.e.…”

Section: Introductionmentioning

confidence: 99%

Scoring rules and abnormally low bids criteria in construction tenders: a taxonomic review

Ballesteros‐Pérez

Skitmore

Pellicer

et al. 2015

Construction Management and Economics

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Section: Introductionmentioning

confidence: 99%

Scoring rules and abnormally low bids criteria in construction tenders: a taxonomic review

Ballesteros‐Pérez

Skitmore

Pellicer

et al. 2015

Construction Management and Economics

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“…It specifically relates to how the customer will value such non-price assets that the competitor may possess. (See K. Simmonds [6].) Thus, P(B) is decomposed into a 4 variate distribution.…”

Section: Structural Model Of a Competitor's Bidmentioning

confidence: 99%

“…Thus P*(G) ^"n^pn.n^i.n^,.]) (6) If, however, the parameters C, M, S, V define a probability distribution P(B) which is independent of whether one of the set of competitors had been beaten i.e., P*( Cj \c t ) =P*(c j \-c 1 )…”

Section: Pi ^ B ^ P Mmentioning

confidence: 99%

A Decision Analysis Approach to Repetitive Competitive Bidding

Bunn¹,

Thomas²

1978

European Journal of Marketing

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“…It enables the client to take account of criteria that reflect qualitative, technical, and environmental aspects of the bid as well as the price. Nevertheless, it involves much more effort of the client in selecting the set of criteria and their relative importance to reach the desired effect [3,[7][8][9].…”

Section: Introductionmentioning

confidence: 99%

Contractor’s bid pricing strategy: a model with correlation among competitors’ prices

Jaśkowski

Czarnigowska

2019

Open Engineering

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The approach used by construction companies to determine bid prices is an element of their strategy used to win jobs in competitive tenders. Such strategies build upon an analysis of the contactor’s potential and capabilities (am I able to deliver? am I eligible to participate in the tender?), and the analysis of the economic environment, including the expected behavior of competitors. The tender strategy sets out both the guidelines and the procedure in deciding whether or not to bid as well as the rules for determining the price. The price, on the one hand, should be high enough to cover expected direct and indirect costs as well as risk-adjusted profit. On the other hand, it needs to be low enough to be considered most attractive (typically: the lowest) among the prices offered by the competitors. The paper focuses on the price definition component of the bidding strategy. It provides a brief overview of the existing methods that support bidding decisions by comparing their demand for input and limitations in practical applications and presents a simulation-based method supporting the determination of the profit ratio. This probabilistic method assumes the existence of a positive correlation between the prices offered by the competitors. Its application is illustrated by means of a numerical example. The outcomes of the simulation prompt the amount of the profit margin that maximizes the expected value of the contractor’s profit.

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Competitive Bidding: Deciding the Best Combination of Non-Price Features

Cited by 16 publications

References 2 publications

Scoring rules and abnormally low bids criteria in construction tenders: a taxonomic review

Scoring rules and abnormally low bids criteria in construction tenders: a taxonomic review

A Decision Analysis Approach to Repetitive Competitive Bidding

Contractor’s bid pricing strategy: a model with correlation among competitors’ prices

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