Best value procurement is transforming how construction contracts are awarded. Instead of automatically selecting the lowest bidder, owners evaluate multiple factors to find the proposal offering the greatest overall value. Understanding this approach helps you compete effectively when quality matters as much as cost.
What Is Best Value Procurement?
Definition
Best value procurement is a selection method where contract award is based on a combination of factors rather than price alone. Owners consider:
- Technical qualifications
- Past performance
- Management approach
- Price
- Other specified criteria
The goal is selecting the contractor most likely to deliver successful project outcomes, not simply the cheapest option.
How It Differs from Low-Bid
Traditional low-bid:
- Lowest price wins
- Meet minimum requirements to qualify
- Limited qualitative evaluation
- Pass/fail on responsibility
Best value:
- Multiple factors evaluated
- Weighted scoring system
- Quality can overcome price difference
- Holistic assessment of value
Why Owners Use Best Value
Risk Reduction
Best value helps owners:
- Reduce project failures
- Minimize change orders
- Achieve quality outcomes
- Select experienced teams
Better Outcomes
Studies show best value projects have:
- Fewer cost overruns
- Better schedule performance
- Higher quality results
- Greater owner satisfaction
Appropriate Applications
Best value works well for:
- Complex projects
- High-profile facilities
- Technical requirements
- Long-term relationships
- Design-build delivery
Types of Best Value Selection
Tradeoff Process
How it works:
- Evaluate all factors
- Allow tradeoffs between factors
- Higher price can win if value justifies
- Maximum flexibility for owner
Example:
Contractor A: Lower price, less experience Contractor B: Higher price, superior experience Result: B may win if experience value exceeds price difference
Lowest Price Technically Acceptable (LPTA)
How it works:
- Must meet technical threshold
- Pass/fail on non-price factors
- Lowest price among acceptable bidders wins
- Less true "best value"
Example:
All contractors meeting technical minimum compete on price only.
Weighted Criteria
How it works:
- Each factor has assigned weight
- Scores calculated for each factor
- Combined score determines winner
- Most structured approach
Example weighting:
- Technical approach: 30%
- Past performance: 25%
- Key personnel: 20%
- Price: 25%
Common Evaluation Factors
Technical Approach (Often 25-35%)
What's evaluated:
- Understanding of requirements
- Proposed methodology
- Risk identification
- Innovation and efficiency
- Quality control plans
How to score well:
- Demonstrate thorough understanding
- Address project-specific challenges
- Show logical execution plan
- Identify and mitigate risks
- Offer meaningful innovations
Past Performance (Often 20-30%)
What's evaluated:
- Similar project experience
- Reference feedback
- Performance ratings
- History of successful completion
How to score well:
- Highlight relevant projects
- Provide strong references
- Document positive outcomes
- Address any negative history
Key Personnel (Often 15-25%)
What's evaluated:
- Experience of key team members
- Relevant certifications
- Track record on similar projects
- Commitment to project
How to score well:
- Assign your best people
- Show relevant experience
- Demonstrate qualifications
- Commit to team stability
Price (Often 25-40%)
How it's evaluated:
- Evaluated against other factors
- Not necessarily lowest wins
- Reasonableness assessed
- Value comparison made
Scoring methods:
- Points inversely proportional to price
- Percentage of lowest price
- Reasonableness threshold
Other Factors
May include:
- Safety record
- Small business participation
- Schedule
- Local presence
- Management approach
- Innovation
The Evaluation Process
Step 1: Responsiveness Check
Proposals screened for:
- Completeness
- Required elements
- Compliance with instructions
- No disqualifying defects
Step 2: Technical Evaluation
Evaluation team reviews:
- Non-price factors
- Applies scoring criteria
- Documents ratings
- Identifies strengths/weaknesses
Step 3: Price Evaluation
Pricing analyzed for:
- Reasonableness
- Completeness
- Accuracy
- Comparison to other bids
Step 4: Best Value Determination
Source selection authority:
- Reviews technical and price scores
- Considers tradeoffs
- Makes value judgment
- Documents selection rationale
Step 5: Award
Selected contractor:
- Notified of award
- Contract executed
- Unsuccessful bidders may request debrief
Strategies for Best Value Success
Know the Criteria
Before bidding:
- Study evaluation factors carefully
- Note weights and priorities
- Understand what's most important
- Read between the lines
Tailor your response:
- Address each factor specifically
- Weight effort to scoring
- Don't ignore any criteria
- Be responsive to requirements
Lead with Strengths
Identify your advantages:
- What makes you different?
- Where do you excel?
- What relevant experience do you have?
- Who are your key people?
Emphasize differentiation:
- Highlight unique qualifications
- Showcase relevant successes
- Feature strong team members
- Demonstrate understanding
Address Weaknesses
Be honest about gaps:
- Acknowledge limitations
- Show mitigation plans
- Demonstrate awareness
- Provide assurance
Don't hide issues:
- Evaluators will find them
- Better to address proactively
- Show how you'll overcome
- Demonstrate good faith
Price Strategically
Consider the tradeoffs:
- Higher price with superior quality can win
- Lowest price doesn't guarantee award
- Value must be demonstrable
- Don't underprice quality submission
Price to win:
- Understand market
- Know competition
- Balance price and quality
- Consider owner's budget
Write Compelling Proposals
Focus on value:
- Show benefits, not just features
- Quantify where possible
- Tell a story
- Make it easy to score high
Be responsive:
- Answer what's asked
- Follow the format
- Address each factor
- Don't leave blanks
Common Mistakes in Best Value Bids
Treating It Like Low-Bid
Mistake:
- Minimal proposal effort
- Focus only on price
- Ignore non-price factors
- Generic submissions
Fix:
- Invest in quality proposal
- Address all factors
- Show your value
- Customize to project
Ignoring Evaluation Criteria
Mistake:
- Not addressing all factors
- Wrong emphasis
- Missing requirements
- Poor organization
Fix:
- Follow criteria exactly
- Organize by factors
- Weight effort appropriately
- Check completeness
Overpromising
Mistake:
- Claims you can't support
- Unrealistic commitments
- Exaggerated experience
- Inflated qualifications
Fix:
- Be honest and accurate
- Support claims with evidence
- Make realistic commitments
- Let record speak
Poor References
Mistake:
- Outdated contacts
- Irrelevant projects
- Unprepared references
- Negative feedback
Fix:
- Current contact information
- Relevant similar projects
- Notify references
- Maintain relationships
Debriefs and Learning
Request a Debrief
After every best value competition:
- Request formal debrief
- Understand your scores
- Learn evaluation perspective
- Identify improvement areas
Questions to Ask
In debrief:
- How did we score on each factor?
- What were our strengths?
- What were weaknesses?
- How did winner compare?
Continuous Improvement
Use feedback to:
- Improve future proposals
- Build relevant experience
- Strengthen weak areas
- Develop winning approach
Conclusion
Best value procurement rewards contractors who invest in quality, build strong teams, and deliver successful projects. Success requires:
- Understanding evaluation criteria
- Building relevant experience
- Developing strong teams
- Writing quality proposals
- Pricing strategically
Don't view best value as an obstacle to winning - view it as an opportunity to be recognized for your capabilities beyond just having the lowest price. The contractors who succeed in best value competitions are often the ones who deliver the best projects.
Invest in building the qualifications and track record that earn high scores. Then present them effectively in proposals that demonstrate the value you bring. That combination wins best value awards.
ConstructionBids.ai identifies selection methods for each opportunity, helping you recognize best value projects and prepare appropriately competitive proposals.
