Proposed Allocation Technique for a Two-Contractor Procurement.
Abstract
This thesis proposes an allocation technique for use when two sources of supply are required for a large number of similar items over a period of years. Use of two contractors insures that a surge capacity will be available to meet sudden increases in demand. A problem arises in determining the portion of the total annual procurement to be allocated either contractor. This problem is even more acute when one is able to offer prices which are significantly lower than his competitor. The proposed technique determines the allocations for both contractors based on relative competitive performance. For each competitor an annual competitive index is established using price bids and any other factor which the procuring agency deems appropriate. Overall competitive indices are then established for both contractors based on their annual indices for a three-year period. Annual allocations are determined using the ratio of the overall competitive indices. The proposed technique is tested using hypothetical data. Included in the testing is a discussion of gaming techniques which might be employed by the competitors in order to gain unearned profits.
Document Details
- Document Type
- Technical Report
- Publication Date
- May 22, 1979
- Accession Number
- ADA069908
Entities
People
- Jay L. Pelzer
Organizations
- Air Force Institute of Technology