Apparatus Purchasing: Unsolicited Pricing

This article is a follow-up to “Apparatus Purchasing: The Confusing World of Exceptions” (Fire Apparatus & Emergency Equipment, June 2018). According to Merriam-Webster’s Dictionary, the word “unsolicited” means “unwelcome, undesirable, and annoying.”

When bidders submit unsolicited pricing in the fire truck world, the result can cause confusion and ill feelings between bidders, purchasers, and the authority having jurisdiction (AHJ). Nobody wants ill feelings with the AHJ. After all, the AHJ signs the check for a new rig. The result may be an apparatus the fire department does not want and, more importantly, one that may not meet the department’s desired operational criteria. You can and should avoid it.

Not all bids are prepared by a local dealer or its sales staff. Where there is no local representation and in cases of extraordinary circumstances, bids might be submitted factory direct. Herein, “vendor” and “bidder” refer to whoever submits the proposal. Vendors submitting unasked-for pricing usually do so in the guise of an alternate bid or an optional bid, explained below.

Reasons for Unsolicited Pricing

There are two reasons bidders submit unsolicited pricing. The first, which most vendors readily proclaim, is to offer the fire department cost savings that the department may not have considered. The other, which I subscribe to, is that the vendor is cunningly offering pricing to give the vendor an unfair advantage in the competitive bidding process—a harsh but true statement.

In my opinion, the earlier reason is not justifiable. The vendor should have made the fire department aware of possible cost savings before the specifications were written and before bids were submitted. That itself is a valid reason to hold a prebid conference. If the vendor didn’t have the opportunity to meet with the fire department beforehand, it could be because the vendor wasn’t aware of what was happening in his territory. Or, the fire department did not want to meet with the vendor. Perhaps the purchaser did not want the vendor’s rig. In either scenario, the vendor was late for the show, and submitting unsolicited pricing just creates discord.

The other reason for seeking an unfair advantage in the bidding process could be construed as being at the least unethical and at the most unscrupulous. Every vendor wants the order, and most are aboveboard and honest in securing it. Granted, some of their efforts may push the boundaries of ethics and integrity to the limit. And, there are some who cross the line knowingly.

Purchasers should consider a vendor’s intent when scrutinizing unwanted pricing. Likewise, vendors should be aware of the precarious and unjustified position they can place the fire department in when submitting such pricing. They may never again be welcome in the purchaser’s fire station.

Educating the Decision Makers

It is reasonable to expect that the fire department and its apparatus purchasing committee (APC) are in sync with the particulars of a new rig. It is equally logical that the AHJ has been made aware of what the fire department wants to purchase and the reasoning thereof. Not every AHJ is firematically oriented. Educating the AHJ is a key factor in purchasing. In larger political subdivisions, a fire apparatus purchase may be evaluated by some obscure bureaucrat who may not know the difference between a dump truck and a fire truck, a custom chassis and a commercial chassis, or a mechanical siren and an electronic siren. However, most bean counters pay close attention to differences in pricing.

Compounding the issue is when a vendor submitting unsolicited pricing claims the item proposed is “equal to” or “superior to” what the fire department has specified. Hence, the fire department has to defend itself to the AHJ against what could be a false narrative or, in a worst-case scenario, an outright fabrication. In political subdivisions, most decision makers are inclined to save money, keep taxes low, secure votes, and avoid unfavorable press with the media.

It is not unheard of for aggressive bidders to attempt backdoor diplomacy, especially in scenarios where AHJ members such as commissioners may be former fire chiefs or long-time fire department members. An astute dealer may remember and direct unsolicited pricing toward his whims and preferences, hoping to get reactions such as the following: “Well, we never needed that big of a motor before; why do we now?” “The 1,250-gallon-per-minute (gpm) pump has always worked well. Is it necessary to go with a 2,000-gpm pump?” “We never had that big of an onboard foam system before. Maybe a portable foam eductor mounted behind the panel is all we need.”

The last thing a forward-thinking APC and fire department need is an outsider “stirring the pot,” pitting new against old and progress against tradition. You can eliminate that threat when writing the purchasing document.

Optional and Alternative Pricing

Purchasers commonly ask for individual pricing in addition to a single “total bid price” for an apparatus. Without splitting hairs, my opinion of an optional price is a request for bidders to provide a price for an item not included in the original purchasing specifications. As an example, a set of purchasing specifications for a pumper does not include a large-diameter hose discharge. The purchaser may ask for an optional price to add the discharge. An optional price could also be requested to upgrade an item already in the specifications. A specification calls for a 1,000-gpm pump, and the purchaser can ask how much to upgrade the pump to a 1,500-gpm capacity. Bidders are not usually obligated to provide optional pricing.

An alternate price is when a purchaser is asking for a price for an item in lieu of what is in the specifications. As an example, a purchasing specification calls for a commercial cab and chassis and the purchaser asks for a price for a custom cab and chassis instead. Again, bidders are not normally obligated to provide alternate pricing.

Individual purchasers and vendors may have their own interpretation of what is an optional bid and an alternate bid. Purchasers should consider defining these bids in their purchasing documents. Doing so may prevent unnecessary misunderstandings during the bid evaluation process. What is imperative and worth noting is, it should be the purchaser who defines what is an alternate bid and what is an optional bid and whether either will be considered. Purchasing specifications should list the specific items for which alternate and optional prices are solicited. Again, it is the purchaser and not the vendor who decides what prices will be considered. Purchasers should not lose control of the bidding process.

Eliminating Unsolicited Bids

Allowing bidders to submit unsolicited pricing is giving the vendor the opportunity to embarrass the fire department whether knowingly or unknowingly. Why let a bidder inadvertently question the judgment of the fire department in specifying what it did? No fire department wants to be put on the defensive justifying its firematic decisions. It is not right and should not be tolerated. It is not unheard of for unprincipled bidders to “bid low and bid often,” regardless of the specifications.

One way to eliminate unsolicited bids is for the purchaser to publish its own fill-in-the-blanks “Bid Form” in the purchasing specifications and specifically note that only requested pricing submitted on the form will be considered. Another statement worth contemplating is the following: “Proposals containing prices not requested on the Bid Form will be considered nonresponsive and immediately rejected.” To keep legal beagles happy, consider making a statement in the purchasing document similar to the following: “Unsolicited pricing will not be considered because all bidders will not have had an equal and fair opportunity to provide the same.” Purchasers are telling the vendors whose rules they are playing by. Control the narrative.

Paraphrasing statements in the aforementioned Exception piece: Unsolicited pricing can be abused by nefarious dealers who may use the process to artificially deflate the real cost of an apparatus. It is conceivable for a bidder to propose a less expensive and possibly inferior product, perhaps claiming he didn’t understand what the purchaser really wanted. Then, buried somewhere in the proposal, disguised as an alternate or optional price, it might say, “But, if you really want what you really specified—add X number of dollars to our bid price.” That’s not right and shouldn’t be condoned. Throw the bid out. Fire departments should write purchasing specifications carefully to control the bidding process. Good luck.

BILL ADAMS is a member of the Fire Apparatus & Emergency Equipment Editorial Advisory Board, a former fire apparatus salesman, and a past chief of the East Rochester (NY) Fire Department. He has 50 years of experience in the volunteer fire service.

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