Competitive Bidding, the Benefits for the buyer Essay (Essay Sample)

The value of getting competitive bids, from the viewpoint of the organizational buyer are as follows:
No Nepotism: Tenders or bids are evaluated based on certain predetermined criteria, such as price, quality, and value for money. In other words, the firm offering the highest quality product or service at the lowest price point would win the contract. As most tender documents are opened and evaluated in a public process, I think that there remains little room for nepotism or favoritism of any kind.
Value for Money: From the perspective of the client, tenders offer the greatest value for the amount of money spent. This is because the client can choose from a wide pool of potential suppliers to select the ones that can produce the highest quality product or service at the lowest price point. This allows the company, establishment or organization to save money without having to compromise on quality.
Encourages Competition: The process of tendering helps promote a competitive market. This is because several potential contractors, firms or suppliers get a chance to bid for every project. And because selection depends on quality and price, every bidder tries to reduce operational inefficiencies and redundancies as much as possible to lower expenses and improve quality.
Easier Entry: The system of tendering makes it easier and simpler for new firms to enter the market or even a particular industry. This is since contracts under this system are awarded based on predetermined, objective criteria. As a result, even a firm that is a new entrant to the market, having no connections or contacts in the industry, can win a prestigious and lucrative contract by providing the highest and greatest value for the client’s money.