Post Tender Negotiation
Post tender negotiation simply means the negotiation that goes after the tender is submitted by the bidder and before awarding the contract, it can be regarding the price or other aspects as well. In most cases it is not permitted to negotiate after tenders, but many purchasing professionals debate on if post tender negotiations can be desirable (Sollish et al, 2011). The UK National Health System (NHS) does not permit post tender negotiations under the Official Journal of the European Community (OJEC) tendering process (NHS, 2010).
As it is mentioned, many procurement professionals still debate on the allowance of post tender negotiations or not. This discussion will include points both supporting NHS choice of permitting post tender negotiations, and disagreeing on NHS policy. The Charted Institute of Purchasing & Supply (CIPS) mentions in their knowledge summary about tendering and post tender negotiations, the summary supports the idea of involving negotiations in post tenders if used professionally and ethically, as it secures value for money, and there should be a responsibility from the purchasing professional if a particular contract requires post tender negotiation (CIPS, n.a.). While Sollish et al (2011) claims that bidders realize that there is no post tender negotiations, it is more likely that they present the best price in the original tender. CIPS (n.a.) clarifies one of reasons to allow post tender negotiations improving value obtained, by claiming that detailed discussion before awarding the contract should discuss bid clarification usually with number of suppliers if the bid is too low or too high, the discussion can include specification or lead time for example. As most sources and professional argue that price negotiations post tender is mostly not permitted, like the case of NHS.
We understand from the points that post tender negotiations can be acceptable depeding on the nature of the contract, and that is decided by the procurement
As it is mentioned, many procurement professionals still debate on the allowance of post tender negotiations or not. This discussion will include points both supporting NHS choice of permitting post tender negotiations, and disagreeing on NHS policy. The Charted Institute of Purchasing & Supply (CIPS) mentions in their knowledge summary about tendering and post tender negotiations, the summary supports the idea of involving negotiations in post tenders if used professionally and ethically, as it secures value for money, and there should be a responsibility from the purchasing professional if a particular contract requires post tender negotiation (CIPS, n.a.). While Sollish et al (2011) claims that bidders realize that there is no post tender negotiations, it is more likely that they present the best price in the original tender. CIPS (n.a.) clarifies one of reasons to allow post tender negotiations improving value obtained, by claiming that detailed discussion before awarding the contract should discuss bid clarification usually with number of suppliers if the bid is too low or too high, the discussion can include specification or lead time for example. As most sources and professional argue that price negotiations post tender is mostly not permitted, like the case of NHS.
We understand from the points that post tender negotiations can be acceptable depeding on the nature of the contract, and that is decided by the procurement
References: CIPS (n.a.) Tendering and Post Tender Negotiation [Online] Available from: http://www.cips.org/Documents/Resources/Knowledge%20Summary/Tendering%20and%20Post%20Tender%20Negotiation.pdf (Accessed 27 July 2013) NHS (2010) PROCUREMENT OF GOODS AND SERVICES [Online] Available from: http://www.cmft.nhs.uk/media/249106/procurement%20of%20goods%20and%20services%20may%202010%20internet%20version%20_2_.pdf (Accessed: 27 July 2013) NHS (2012) Standing Financial Instructions Contracting and Purchasing [Online] Available from: www.southwestyorkshire.nhs.uk/documents/305.doc (Accessed: 28 July 2013) Sollish, F., Semanik, J., Morris, P. W. G. & Pinto, J. K. (2011) Planning and Administering Project Contracts and Procurement. Laureate Education, Inc., custom ed. Hoboken: John Wiley & Sons. University of Leicester (n.a.) Guidance on Post-Tender Negotiation [Online] Available from: www2.le.ac.uk/offices/purchasing/tendering-procedures/post-tender-negotiation (Accessed: 28 July 2013)