Price and Cost
The discussion below is a study determining price reasonableness and what the basic difference actually is between price and cost analysis. There shall also be an overview of how each is utilized today. In regards to sorting out this subject, the 2009 work by Paula B. Compton known as Federal Acquisition shall be looked at.
Purpose for Determining Price Reasonableness
There has been some struggle in various agencies concerning fair and reasonable price determinations in their energy savings performance contracts (ESPCs) predominantly since this financing vehicle is rather rare and new in the federal sector. Every branch of the government has skill in executing appropriations- funded contracts, and there are several effectual techniques to guarantee price reasonableness in these contracts. However, the execution of an ESPC basically varies from the procedures utilized in more conventional methods of contracting (Shonder and Atkin, 2005). Specifically, the techniques of determining price reasonableness most common to the federal contracting officers are usually inapplicable to ESPCs. The majority of the federal ESPC projects are executed as delivery orders under one of the energy or defense department's indefinite-quantity, indefinite-delivery (IDIQ) ESPCs in the absence of a real price competition. Hence at the contractor selection phase, competition cannot be utilized to assure price reasonableness. ESPC projects are comparable to design-build contracts, only that the energy services company (ESCO) basically comes up with a firm-fixed price plan at a point when the ESCO-developed design is just around 30% from completion. Missing total cost information, it is not easy for the government to conduct traditional cost evaluation or come up with an independent cost approximation to relate with the ESCO's plan
Federal Acquisition: Key Issues and Guidance
This is an important guide to comprehension and working in the complicated world of federal government contracting. It provides short but detailed explanations of the main stages and important duties in the contracting procedure. Put down in plain...
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