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E, 20xx Cost Analysis The review and evaluation of the individual cost elements that make up the supplier’s price. Cost elements are typically included in the supplier’s cost estimate/proposal, often acpanied by technical or other proposals. 169。s proposed costs. This assumes the supplier presented a work plan to acplish the proposed efforts in its technical proposal. ? The relationship of the proposed costs to the required work. In this assessment, the technical/management team will determine whether all costs proposed are necessary for the satisfactory pletion of the work. Proposed costs for work determined to be unnecessary should be excluded. 169。AMERICAN CERTIFICATION INSTITUTE, 20xx Source Selection ? Source selection involves: – evaluating bidders’ proposals – choosing the best one – negotiating the contract – awarding the contract ? It is helpful to prepare formal evaluation procedures for selecting suppliers. 169。AMERICAN CERTIFICATION INSTITUTE, 20xx Steps in Evaluation and Selection Is award to be Made to the Lowest Responsive, Resonsible Bidder? If YES, determine Responsibility and Award to Low Responsiive Bidder. If NO, Develop evaluation plan in accordance with The Project Plan amp。AMERICAN CERTIFICATION INSTITUTE, 20xx Offer Evaluation 1 LeRoy H. Graw, EdD, ., CPCM, CPP, CPPM 169。AMERICAN CERTIFICATION INSTITUTE, 20xx Knowledge/Skill/Ability ? Evaluate petitive offerings to determine the overall best offer for a product/service. 169。 Solicitation Evaluation Criteria. Determine from Project Plan or Solicitation the Basis for Award 169。AMERICAN CERTIFICATION INSTITUTE, 20xx Sample Proposal Evaluation Sheet 169。AMERICAN CERTIFICATION INSTITUTE, 20xx Technical Evaluation of the Supplier’s Technical Proposal ? The degree to which the proposed effort is duplicated. A given cost proposal may contain costs which have been proposed elsewhere in the same proposal or in prior proposals for work that was pleted prior to the instant contract. ? The validity of the estimating techniques employed in the proposal. If historical data is used in projecting future cost, the team should determine if the current contract schedule, workload, and other conditions have been adequately considered as a basis for projecting the historical costs to the future. 169。AMERICAN CERTIFICATION INSTITUTE, 20xx Profit Analysis The review and evaluation of the supplier’s profit dollars, percentages, and factors included in the supplier’s cost estimate/proposal. 169。AMERICAN CERTIFICATION INSTITUTE, 20xx Price Analysis—When Conducted? By itself (no cost analysis): 1. Low dollar purchases. 2. Most petitive purchases, even though of a large dollar value. 3. Purchases based upon existing catalog or market prices. 4. Purchases of items or services for which regulated prices exist (regulated utility services). 169。s cost trends, on the basis of current and historical cost or pricing data. 3. A technical appraisal of the estimated labor, material, tooling and facilities requirements and of the reasonableness of scrap and spoilage factors. 4. The application of audited or negotiated indirect cost rates, labor rates, or other factors. 169。AMERICAN CERTIFICATION INSTITUTE, 20xx Technical (Quantitative) Analysis of the Supplier’s Cost Proposal ? The reasonableness of proposed direct labor hours. This analysis attempts to determine whether or not the supplier has based the hours on proper planning and that