Cost Savings-Avoidance Instructions.doc

The document outlines guidelines for Cost Savings and Cost Avoidance in procurement processes. Cost Savings involve reducing costs through competitive processes, rebidding contracts, and choosing lower-cost options over existing contracts. Cost Avoidance includes savings from cooperative purchasing agreements and audit recoveries. Other areas for cost savings/avoidance include outsourcing services, value analysis, challenging specifications, and product substitutions. Each method has specific definitions, calculations, and examples provided to help in determining and reporting cost savings or avoidance accurately.