At the conclusion of the evaluation process, the evaluation panel must both recommend and justify (i) either the rejection of all offers, (ii) proceeding with contract negotiations, or (iii) contract award. The evaluation panel’s recommendation is made to the approving authority.
Contracts for goods and works procurement are not usually negotiated, except under exceptional circumstances, depending on the complexity of the requirement. Complex requirements for supply, installation and commissioning may be better procured through negotiations with the highest technically qualified firm, as determined by the results of the evaluation of their technical proposals. Similarly, under works procurement, design and build requirements may also need to be negotiated; as well as, turnkey contract requirements.
In the case of consulting services, there are consulting firms and individual consultants. Contracts for these two categories of consultants are negotiated slightly differently.
For individual consultants, after the technical evaluation, the highest ranked consultant is invited to submit a financial offer and to negotiate the terms of the contract. If for some reason an agreement isn’t reached, the next highest ranked consultant may be invited, depending on the procedures, to submit a financial offer and to contract negotiations. The focus of the negotiations should be to reach an agreement on the Terms of Reference of the assignment, with minor modifications if necessary. Price negotiations should be kept to a minimum and should only take place if the financial offer is considered unreasonable based on documentary and/or historical evidence.
Negotiations with consulting firms are dependent on the procurement method used. Based on the procurement method, final selection will be determined either by:
(i) the sum of the weighted average of the technical and financial proposals (quality and cost based selection),
(ii) the lowest proposed price among the technically qualified consultants (least cost selection),
(iii) the reasonableness of the financial offer of the highest ranked consultant (selection based on qualifications, similar to the selection of individual consultants), or
(iv) the lowest proposed price among the technically qualified consultants within a stipulated budget (fixed budget selection).
In the first instance, the financial offer cannot be negotiated because it would be unfair to the other firms that participated in the process, because the price was a determining factor in the overall combined score that led to the selection of the consultant. Thus, only the technical aspects of the proposal can be negotiated. The focus of the negotiations should be on resolving weaknesses observed in the selected consultant’s technical proposal and reaching agreement on the terms and conditions of the contract libido-portugal.com/.
Price cannot be a negotiating point in the second instance because the selection was price-based.
In the third instance, given that the price was not a determining factor in the final selection of the consultant, but rather the highest technical score, the price can be negotiated if found unreasonably high.