What is Best Value Procurement?

Best Value Procurement (BVP) is a procurement method that emphasizes selecting the supplier that offers the most value rather than just looking at the lowest price. BVP looks at the overall performance of the bidder, including quality, risk, innovativeness, and added value the supplier can deliver. The goal is to select not only the cheapest, but more importantly the most competent party capable of successfully and efficiently executing a project.

How does Best Value Procurement work?

Best Value Procurement works using a structured approach in which bidders are evaluated not only on price, but more importantly on their ability to add value. This is done through a number of key stages aimed at identifying and leveraging the expertise of bidders:

1. Performance justification:

Bidders must submit a performance justification describing how they will approach the task and what value they can add. This document focuses not only on what they do, but also on why they do it better than others. It is important to clearly highlight your company's USPs (Unique Selling Points).

2. Interviews:

A unique component of BVP is the interview phase, in which key individuals from the tendering parties are interviewed. These interviews are designed to determine whether the individuals involved actually have the expertise and knowledge needed to perform the contract. This component helps to ensure the accountability of the bidders.

3. Risk analysis:

In BVP, risk management is an essential component. Bidders must provide a detailed risk analysis in which they not only identify potential risks, but also demonstrate how they will manage those risks. This helps the contracting authority gain confidence in the bidder's abilities to proactively address issues.

4. Plan of Action:

In addition to the performance justification and risk analysis, a plan of action is submitted that shows how the bidder will actually perform the contract. The plan of action must be clear, concise and consistent with the requirements of the selection guide and other tender documents.

5. Assessment and Selection:

The contracting authority evaluates tenders based on their performance justification, interviews, risk analysis, and plan of action. The total value offered by the tenderer is considered rather than just the lowest price.

Why is Best Value Procurement used?

BVP is becoming increasingly popular because it shifts the focus from price to quality and value creation. It helps select the best party that can not only perform the contract, but also do it better and more efficiently than the competition. This often leads to better project results, lower risks and more innovation.

Benefits of Best Value Procurement:

• Focus on quality: BVP emphasizes quality and performance, leading to higher value for the contracting authority.
• Better risk management: Through detailed risk analyses, BVP requires bidders to think proactively about potential problems and their solutions.
• Encouraging innovation: Because BVP challenges bidders to demonstrate their added value, it encourages innovative solutions and methods.
• Efficient project execution: BVP selects parties that offer not only the cheapest solution, but also the most efficient, often leading to shorter lead times and lower costs in the long run.

Disadvantages of Best Value Procurement:

• Complexity: The extensive documentation, interviews and assessments make BVP a complex and time-consuming process, both for bidders and the contracting authority.
• Height of documentation requirements: Entry requirements are often higher, which means companies with less experience may have trouble competing.

Best Value Procurement in Practice

BVP is often applied to complex and high-risk projects such as infrastructure, construction projects, and IT services, where selecting the right supplier is crucial to the success of the project. By focusing on bidders' competencies rather than just price, BVP ensures that the most competent party is selected.

Tips for being successful in Best Value Procurement:

• Provide detailed performance justifications: Be sure to describe the specific value-added of your offering clearly and concretely.
• Prepare for the interviews: Make sure the key people are well prepared and that their knowledge and expertise are well reflected during the interviews.
• Conduct a thorough risk analysis: Not only identify risks, but also demonstrate proactive measures to control them.
• Prepare a clear and practical plan of action: Ensure that the plan of action is not only feasible, but also consistent with the specific requirements of the contracting authority.

Conclusion: What is Best Value Procurement and why is it important?

Best Value Procurement is a powerful procurement strategy that looks beyond price and focuses on delivering maximum value by selecting the best and most competent party. By emphasizing performance, risk management and innovation, BVP ensures that projects are not only executed successfully, but also in a way that provides the most value to the contracting authority.