Contract award negotiations

Due to the price level of medium-sized and large-scale projects, both parties will invest considerable time and effort in the price and deadline negotiations. Participants in contract award negotiations are often trained in negotiation techniques /2.40/. In this connection it may occur that so-called facilitating payments are expected. 

Contract review is but one of the tasks in the contract acquisition process. These are marketing, prospect acquisition, tendering, contract negotiation, contract award, and then contract review. However, in a sales situation, you may simply have a catalog of products and services and a sales office taking orders over the telephone or over the counter. The contract review element of this operation takes a few seconds while you determine if you can supply the item requested. In an organization that produces products to specific customer requirements you may in fact carry out all the tasks in the contract acquisition process. Rather than isolate the contract review task and produce a procedure for this, your business may benefit more from a procedure or series of procedures that covers the contract acquisition process as a whole. 

Contract Award - Every contract award, whether competitive or negotiated, must be documented with a thorough justification memo analyzing the reason for the selection and comparing the relative merits of all contractors considered. 

Procurement/purchasing—All actions related to acquisition plaiming, solicitation, evaluation, negotiations, contract award, contract administration, and contract management functions. 

Even the phase of the contract awarding, which begins with pre-qualification and ends with the conclusion of the contract, may extend over several years, especially due to lengthy contract negotiations. 

The first thing that has to be arranged before any work can be done is the establishment of a project team and mobilization of this team to, preferably, a location near the works. Whereas the project team is often estabUshed during the tender or negotiation phase before contract award, mobilization of this team to the country/ location where the job is executed is required for the other preparation activities that have to be done. 

To protect both parties in a contract arrangement it is good practice to make a contract in which the scope of work, completion time and method of reimbursement are agreed. Contracts are normally awarded though a competitive tendering process or after negotiation if there is only one suitable contractor. 

In crafting the RFP, clearly state your assumptions about volumes of business to be awarded, service levels, etc. explain the selection process and criteria and outline how you intend to measure both your and the supplier s compliance with the terms of the contract. Point out the potential increase in business that winning the contract would mean. Send out the RFP and then make your preliminary decision based on your preestablished criteria and use your best negotiating skills to come up with a final choice. 

This flexibility has an impact on the relationship between the inspector and the inspected inspectors are free to build a cooperative relationship with the inspected, and there is room for compromise (Ayres Braithwaite 1991). Consequently, the regulatory compliance check is more based on negotiation. Etymologically, the Latin word negotiation means trade or commerce . Specifically, it describes action to deal with an issue, the award of a contract and, by extension, various preliminary operations that are carried out in order to reach agreement. It also refers to discussions held before a contract is agreed or discussions concerning the settlement of a dispute (Cornu 2010). 

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