47.306
Transportation factors in the evaluation of offers
Contracting officers must evaluate transportation costs and facility adequacy to ensure the government selects the most cost-effective and logistically sound offer.
Overview
FAR 47.306 requires contracting officers to evaluate not only the price of goods or services but also transportation and transportation-related costs, as well as the adequacy of offerors’ shipping and receiving facilities, when reviewing offers. This ensures that the total cost to the government, including delivery and logistics, is considered in the award decision. The section references further details on how to determine transportation costs, how to identify the lowest overall transportation costs, and how to assess the adequacy of loading and unloading facilities in related subsections.
Key Rules
- Consideration of Transportation Costs
- Contracting officers must include transportation and related costs in the evaluation of offers, not just the base price.
- Evaluation of Shipping and Receiving Facilities
- The adequacy of the offeror’s shipping and receiving facilities must be assessed as part of the evaluation process.
Responsibilities
- Contracting Officers: Must ensure transportation costs and facility adequacy are factored into offer evaluations and award decisions.
- Contractors: Should provide clear information on transportation arrangements and facility capabilities.
- Agencies: Should provide guidance and oversight to ensure compliance with these evaluation requirements.
Practical Implications
- This section exists to prevent hidden costs from impacting the government’s total expenditure by ensuring all logistics-related expenses are considered.
- It impacts daily contracting by requiring more thorough analysis of offers, especially for supply contracts involving significant shipping.
- Common pitfalls include overlooking transportation costs or failing to assess facility adequacy, which can lead to higher overall costs or delivery issues.