A Procedure for Rebalancing Unbalanced Bidding in Unit Price ContractsSource: Journal of Legal Affairs and Dispute Resolution in Engineering and Construction:;2023:;Volume ( 015 ):;issue: 002::page 04523011-1Author:Khaled Hesham Hyari
DOI: 10.1061/JLADAH.LADR-939Publisher: American Society of Civil Engineers
Abstract: Unbalanced pricing in unit price contracts aims at gaining additional benefits for the contractor who utilizes this strategy at the expense of the owner, or obtaining a competitive advantage over other competing bidders who submit balanced or less skewed bids. This paper presents the development of a procedure to prevent the negative impacts of unbalanced prices in submitted bids on the owner. The proposed procedure rebalances the submitted rates of all bidders based on the reasonable price for each item as determined by the bidders themselves. The basis for adjusting item rates is the pack price of each item and the bidder’s total submitted bid price. Applying the procedure eliminates the need for the challenging task of detecting unbalanced bids, as well as the need to reject such bids and re-advertise the project. The proposed method can handle various forms of bid unbalancing, including front loading, quantity error exploitation, as well as the imbalance associated with collusion schemes. The procedure’s robustness is demonstrated through two examples. The method is anticipated to provide the needed protection for owners against additional costs and financial risks associated with an imbalance in bids. Simultaneously, the method deters bidders from manipulating submitted bids and nurtures fair competition among bidders to win the contract.
|
Show full item record
contributor author | Khaled Hesham Hyari | |
date accessioned | 2023-08-16T19:10:45Z | |
date available | 2023-08-16T19:10:45Z | |
date issued | 2023/05/01 | |
identifier other | JLADAH.LADR-939.pdf | |
identifier uri | http://yetl.yabesh.ir/yetl1/handle/yetl/4292886 | |
description abstract | Unbalanced pricing in unit price contracts aims at gaining additional benefits for the contractor who utilizes this strategy at the expense of the owner, or obtaining a competitive advantage over other competing bidders who submit balanced or less skewed bids. This paper presents the development of a procedure to prevent the negative impacts of unbalanced prices in submitted bids on the owner. The proposed procedure rebalances the submitted rates of all bidders based on the reasonable price for each item as determined by the bidders themselves. The basis for adjusting item rates is the pack price of each item and the bidder’s total submitted bid price. Applying the procedure eliminates the need for the challenging task of detecting unbalanced bids, as well as the need to reject such bids and re-advertise the project. The proposed method can handle various forms of bid unbalancing, including front loading, quantity error exploitation, as well as the imbalance associated with collusion schemes. The procedure’s robustness is demonstrated through two examples. The method is anticipated to provide the needed protection for owners against additional costs and financial risks associated with an imbalance in bids. Simultaneously, the method deters bidders from manipulating submitted bids and nurtures fair competition among bidders to win the contract. | |
publisher | American Society of Civil Engineers | |
title | A Procedure for Rebalancing Unbalanced Bidding in Unit Price Contracts | |
type | Journal Article | |
journal volume | 15 | |
journal issue | 2 | |
journal title | Journal of Legal Affairs and Dispute Resolution in Engineering and Construction | |
identifier doi | 10.1061/JLADAH.LADR-939 | |
journal fristpage | 04523011-1 | |
journal lastpage | 04523011-10 | |
page | 10 | |
tree | Journal of Legal Affairs and Dispute Resolution in Engineering and Construction:;2023:;Volume ( 015 ):;issue: 002 | |
contenttype | Fulltext |