Evaluated Bid Price

Evaluated bid price is the figure a buyer uses to compare responsive bids once the pricing rules in the solicitation have been applied. Those rules can cover required quantities, optional items, disbursements, taxes and other cost elements the solicitation names. The result is the number that goes into the price comparison, and it may not match the headline price on a bidder's cover page.

In Canadian federal procurement, the exact calculation is set out in the solicitation's pricing and basis-of-selection provisions. The buyer, not the bidder, calculates the evaluated price under the published method. Reading those provisions closely is the only reliable way to know what will be compared.

How the evaluated price is built from the solicitation's pricing rules

The evaluated price starts with the bid price but follows the solicitation's instructions on what to include. A National Capital Commission solicitation posted on CanadaBuys states that the evaluated price is the total cost, including disbursements and applicable taxes, and that actual costs to the NCC are evaluated through the price proposal form. You can read the wording in the NCC workplace modernization tender notice.

Another CanadaBuys-posted request for proposal for professional services states that all tables in the proposed basis of payment are considered in calculating the evaluated price. See the RFP document. A bidder who prices only the main table can leave out components the buyer will count.

Where evaluated price fits in the basis of selection

Evaluated price only comes into play after a bid passes screening. PSPC explains that bids are normally evaluated on technical merit and overall best value as described in the solicitation's basis of selection, and that selection may instead go to the lowest-priced responsive bid. The PSPC bidding guidance sets out both approaches.

CanadaBuys describes the two selection methods as the lowest-priced bid and best overall value. Under best overall value, the lowest evaluated price per point is generally determined by dividing bid price by the total technical points achieved. The CanadaBuys guide to how bids are evaluated and selected explains the ratio.

Treasury Board Secretariat guidance describes related methods:

• Lowest evaluated price, mandatory requirements only: bids that meet every mandatory requirement are compared on price.
• Lowest evaluated price, mandatory requirements and point-rated criteria: bids must meet the mandatory requirements and generally a minimum point-rated score before price is compared.
• Lowest price per point or a weighted combination: technical merit and price are combined under the stated formula.

These methods are described in the Treasury Board evaluation criteria guidance.

How solicitation documents label and use the figure

Solicitations use different labels for the same idea. One CanadaBuys-posted RFP calls the calculation "Total Bid Price for Evaluation (Bidder's Evaluated Price)". It uses the lowest evaluated price in its pricing-score calculation, so responsive bids are prorated against the lowest evaluated price. The wording is in this request for proposal. Your evaluated price therefore affects both your own score and how other bids are scored.

What evaluated bid price means for a supplier

Treat the pricing and basis-of-selection sections as part of your bid design, not as an afterthought. Several habits protect a bid:

• Read the basis of selection, financial-evaluation method, price schedule and basis-of-payment provisions before you price.
• Submit every required price component in the prescribed form.
• Include options, quantities, disbursements, taxes, travel or other cost elements whenever the solicitation says they form part of the evaluated price.
• Check that arithmetic, totals, units and assumptions are consistent with the solicitation.
• Meet all mandatory requirements and any stated minimum technical score. A low price does not make up for a non-compliant bid.

Because the buyer calculates the evaluated price, a bid that is inconsistent with the published method can be compared on a different number than the one you intended.