Before building the proposal, it’s imperative to understand what type of acquisition method the Government is employing. Generally, there are two types: Sealed Bids and Best Value.
Sealed Bidding is a straightforward award to the lowest bidder. The requirements are usually not complex or technically challenging. The Government has a firm understanding of exactly what they want and what they’re willing to pay for. The market has sufficient potential offerors that are capable of doing the job with little risk of failure. Provided the pricing passes the Government’s determination that it’s “fair and reasonable” the contract is given to the offeror with the lowest price. With public disclosure of the winning bid, there is little room for argument regarding why the winner was chosen.
As projects become more and more complex, the risk of failure of a contractor increases. The cost of the project become less important than other considerations, such as a good history of strong performance, or technical know-how, or highly experienced team members. Now we enter the realm of “Best Value.”
The term “Best Value” sometimes scares people, but at its essence, Best Value simply means that the Government is not required to award to the lowest bidder. There are some aspects of the project which they consider more important than cost. Perhaps it’s risk avoidance, and they’re willing to hire a contractor who has specific capabilities or experiences, providing a low risk approach, even though there is another contractor available for a lower price.
Perhaps the Government is willing to entertain a higher degree of quality or performance or service, and they’re willing to “trade” a higher price tag to obtain these attributes.
Best Value awards fall into two categories: Lowest Price Technically Acceptable (LPTA) and Tradeoff. The Government’s choice of approach is again based on the importance of price compared to other considerations, and how complex and risky is the work itself. You’ll need to know exactly which method the Government is using. It makes a huge difference in how the proposal is written. Where Tradeoffs require a high degree of detail and substantiating information, LPTAs generally are only concerned with a few specific pass/fail criteria.
Start with Section M of the RFP. It should state whether this is LPTA or Tradeoff. Unfortunately, there’s no standardized wording across all Departments and Agencies issuing RFPs. The words “Tradeoff” or “Lowest Price Technically Acceptable” may not even be used. Look for the telltale pass/fail criteria. That’s a good indicator you may be looking at LPTA. A list of evaluation factors and sub-factors would indicate a Tradeoff approach.
If there’s any doubt, make sure you clarify this with a question to the Contracting Officer. Some might think this is revealing your ignorance to your competition (questions are usually public). Perhaps, but it is absolutely critical that you understand how the Government is making the award.