Six Problems Related to the Solicitation Process and Receipt of Offers in Procurement and Supply Chain Management

During the course of competitive quoting, problems may arise that require action by the organization. Such problems typically include one or more of the following:

  1. Time extensions and amendments to solicitation — If one supplier is granted a time extension to respond to a bid request, all suppliers must be notified that they are granted the same extension. Changes to the original bid request must be communicated to all bidding suppliers in a consistent and timely manner.
  2. Late bids (without time extensions) — The supply management professional must make clear the organization’s policy relative to late bids. A common practice is to refuse late bids and return them unopened.
  3. Offers with errors, irregularities or omissions — If a supplier identifies a mistake in a bid after submission, it is good practice to allow that supplier to cancel or withdraw the bid. Courts allow the withdrawal of bids only when (1) the mistake was mechanical or clerical in nature, not an error in judgment, and (2) the bidder was not guilty of blame-deserving negligence in making the error or in delaying notification to the supply management professional of the error. The supply management professional should ensure that a supplier does not repetitively make these types of mistakes.

If an error, irregularity or omission is so out of proportion as to indicate a mistake, the organization should seek confirmation of the bid from the bidder before proceeding to make the award. If a mistake is confirmed, the bidder should be allowed to cancel or withdraw the bid without penalty.

The buying organization should seek clarification of any information that is unclear or difficult to understand prior to final analysis of the supplier’s bid.

4. Confidentiality/security — As with all supply management documents, files containing bids should be secured to prevent unauthorized access. Confidential information about one supplier should not be shared with others.

5. Alternate proposals — Suppliers often propose work (products or services) that is different from the work specified by the supply management professional. These proposals often have merit, and buying organizations frequently set policies for whether and how to consider them.

6. Procedure for cancellation of solicitations — Each bidding supplier should be notified in writing as promptly as possible if the buying organization decides to cancel an in-process solicitation.

Other Solicitation Considerations in Procurement and Supply Chain Management

If a purchasing situation is complex due to issues such as highly technical specifications, a large spend, or the critical nature of a contract, if time allows, a pre-bid or pre-proposal conference (either in person, using video conferencing, or teleconferencing) may be helpful. All potential suppliers that the buying organization would consider using should be invited to participate. Suppliers should receive the solicitation package well in advance of the conference so they have time to review it prior to the meeting.

The conference provides the opportunity for two-way communication about blueprints and specifications, SOWs, quotation due dates, terms and conditions, proposal evaluation criteria, delivery schedules and materials, releasing procedures, invoicing procedures and documentation (including incentives), requirements if awarded business (such as reporting, insurance, background checks, security clearances, and permits), and other requirements established by the buying organization and supplier. If a conference results in changes to the solicitation, a written amendment to the solicitation should be issued. However, some suppliers may not be able to attend because of time, cost, or concerns about sharing information with competitors.

There are several best practices to ensure the solicitation process is fair and ethical. These include:

  • Only qualified suppliers that the buying organization would consider awarding business to should be included in the solicitation process. To include suppliers that are not qualified is a waste of their time and resources.
  • All suppliers must receive the same information as part of the solicitation and during the solicitation process. For example, if a supplier asks for clarification, all suppliers should receive the explanation.
  • The suppliers should have adequate time to respond to the solicitation. The time allowed should consider the complexity of the process, the buying organization’s needs, and other solicitations that the suppliers may be addressing from the buying organization.
  • Time extensions, if given, must apply to all suppliers.
  • If a solicitation is cancelled by the buying organization, all suppliers should be notified immediately.
  • All supplier proposals or quotations are confidential and should not be shared unless it is required by law to be public information.
  • Record the time and date each submission was received.
  • Review each submission for completeness, ensuring that all documents referenced by the supplier or requested by the organization are included.
  • Retain all submitted documents from each respondent in the original bid package.
  • Evaluation criteria should be consistently applied to all suppliers.
  • All suppliers that submit quotations should be notified whether they received the award or not.

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