The following is to be individual work. You are not to discuss or work with anyone else on this case. This is due at the start of class November 25, 2015 (next week) and is worth 5%. As a helpful hint, think of Ron Engineering. As well as a hard copy, this assignment is to be submitted through Turnitin.
A competitive bid solicitation was issued for renovation work to Building T. It was scheduled to close at 2:00 pm on 28 October 28. A mandatory condition of the bid solicitation required bid security in the amount of 5% of the bid price. The bid also specified that contract financial security for both labour and material, payment and performance would be a requirement of any resultant contract. Bid evaluation would be based on mandatory requirements and on price.
On 27 October, a letter was received from, Scott Sinclair, the President of Albatross Limited. He stated that the firm was withdrawing its bid because it had become aware that information upon which its bid was based was erroneous and that there was insufficient time to revise its bid. He also requested that the bid security of 5% be returned.
On 28 October when the bid solicitation closed, there were six bids received, including the one from Albatross. The responding firms and their prices were:
Albatross Limited $4,600,000
Dilbert Incorporated $5,125,000
Matt Building Inc. $5,275,000
Weldon Corporation $5,350,000
Con-Con Construction Ltd. $5,780,000
Vesna Inc. $6,425,000
At 4:30pm, on 28 October an email was received from Sheila MacDougal, the Vice-President of Dilbert Incorporated which stated that the firm was withdrawing its bid. It had just been awarded another large contract that it had not been expecting and, consequently, did not have the resources to perform both jobs at the same time. Dilbert had provided bid security in the form of a certified cheque in the amount of $260,000. The following day, a confirming letter, sent by registered mail was received.
Con-Con Construction failed to provide bid security with its bid. However in an enclosed letter, signed by its President, Alexander Moore, it warranted that its bid would remain open for the entire period of validity. In the event of being awarded the contract, there would be no problem in supplying the required contract financial security.
Matt Building Inc. provided an interesting and appealing alternative within its bid. The material for the cladding for the ground level floor on the street side of the building and the exterior walkway could be upgraded to Adair marble for a premium of $81,000. This would normally have a cost of $250,000 if bought and installed separately.
Weldon Corporation also offered an interesting and appealing alternative within its bid. The were new construction materials that had just been developed and offered for commercial sale. Using this new (and improved) material in building would reduce the construction material and labour costs (since work could be done faster). Acceptance would result in a reduction of $500,000 from its bid price.
Both Weldon and Vesna Inc. provided bid security as specified.
Identify and explain the issues involved.
Identify the firm to whom the contract should be awarded
Identify the situation for each firm and the actions the contracting authority should consider taking if any.
