Question

Why do government agencies publicly open sealed bid tenders and announce the identify and amount of the winning bidder? (Explain in 100 words)

Answer 1

A sealed-bid auction is a type of auction process in which all bidders simultaneously submit sealed bids to the auctioneer so that no bidder knows how much the other auction participants have bid. Sealed bid refers to a written bid placed in a sealed envelope. The sealed bid is not opened until the stated date, at which time all bids are opened together. The highest bidder is usually declared the winner of the bidding process.

The sealed bidding, is formal advertising which involves the issuance of an Invitation for Bid (IFB) by a procuring agency.

Sealed bidding is how the government contracts competitively when its requirements are clear, accurate and complete. An Invitation For Bid (IFB, IFBs) is the method used for the sealed bid process.

IFBs usually include a copy of the specifications for the particular proposed purchase, instructions for preparation of bids, and the conditions of purchase, delivery and payment schedule. The IFB also designates the date and time of bid opening.

Following receipt and evaluation of the bids, a contract is usually awarded to the lowest priced bidder, determined to be responsive and responsible by the contracting officer.

Each sealed bid is opened in public at the purchasing office at the time designated in the invitation. Facts about each bid are read aloud and recorded. A contract is then awarded to the low bidder whose bid conforms with all requirements of the invitation and will be advantageous to the government in terms of price, and price-related factors included in the invitation.