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Managing Contingency amounts at Negotiation award

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edited Aug 21, 2020 11:31PM in Sourcing 4 comments

Summary

How to include contingency amounts in the Negotiation award approval without disclosing the contingency to the supplier

Content

Is there a a way we can include contingency amounts ($ values) in the Negotiation award approval, in a way that the contingency amount flows through to the contract value upon award, but is not disclosed to the supplier until released? 

eg, on a construction contract, we may award the bid price of $1M + $0.1M contingency = $1.1M total in the Negotiation award approval.  The contingency is for unexpected events, which can be released at the approval of the Contract manager, without having to seek re-approval for the total award value.  The contingency is not disclosed to the successful supplier at the time of award - only if / when portions of the contingency are released. 

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