Dictionary of Procurement Terms

A decision to contract with a specified supplier over an extended period of time.

The percentage of defective items that a customer is willing to accept.

1. A negotiation tactic in which the initial offered price is low and is then raised once interest is shown. 2. A price offered that is far below an estimated or expected price. See also: Buying In.

The Bidder who fully complied with all of the bid requirements and whose past performance, reputation, and financial capability is deemed acceptable, and who has offered the most advantageous pricing or cost benefit, based on the criteria stipulated in the bid documents.

1. An aggregate or lot price that may represent the total price for a group of items in place of or in addition to unit prices for each individual item. 2. The total price of a group of items that is priced as a whole for bidding purposes.