Pricing & Calculation
We offer tailored solutions and expert guidance to help businesses optimize their pricing strategies, accurately calculate costs and revenues, and improve profitability while staying competitive in their markets.
One of the most significant concerns of companies participating in tenders in foreign countries is pricing. It is almost mandatory for companies who do not know the commercial practices, commercial law, and customs of established suppliers in a country where they have not completed any work before, to work with local engineering firms while preparing their price quote. It is observed that successful firms in tenders receive support from local engineering firms during the pricing process and work together with a reliable price working group.
There are certain countries where it is compulsory to procure specific materials from local suppliers. In some tenders, local suppliers are even given special protection, and firms bidding for the tender are encouraged to establish a cooperative relationship with these local suppliers, making it mandatory to procure goods or services from them. Through such measures, governments aim to protect the prices of local suppliers against foreign competitors, while also supporting the local economy by ensuring that the materials forming the backbone of the tender are procured from local producers within the country.
It is observed that in tenders published in developing or underdeveloped countries, a point advantage is granted if a subcontracting agreement or joint venture is made with local firms. In this way, the technical and managerial experience of the foreign partner or bidder will be transferred to the local partner, and local contractors in the country will develop and create added value in the country.
Tenders financed by development agencies frequently include conditions aimed at supporting local producers, subcontractors, and joint venture partners in the beneficiary country.
European Union regulations contain strict provisions regarding competition. Penalties are provided to ensure transparency and prevent discrimination by local suppliers between foreign and local bidders. Pricing practices that would reduce competition equality and transparency among bidder firms are prohibited. To be informed about the rules that suppliers and bidder firms must comply with, you can obtain written consultancy services from our company.
If a bidder intends to participate in a tender published in a European Union member state, we recommend that they avoid making mistakes in analyzing bilateral agreements when preparing their price offer.
However, EU companies often face challenges in accessing public procurement markets in non-EU countries. Some trading partners have implemented protectionist or discriminatory measures that negatively impact EU companies. As a response, the EU is taking measures in various areas to ensure fair competition and enhance market opportunities for EU companies.
The aim of the new regulations is to enhance the integration of shared societal objectives into the procurement process. Such objectives consist of promoting environmental protection, social responsibility, innovation, combating climate change, generating employment opportunities, safeguarding public health, and taking into account other social and environmental concerns.
Innovation partnerships involve a contracting authority collaborating with one or more partners to research and develop (R&D), pilot, and subsequently purchase a new product, service, or work that is not currently available on the market. This structured partnership is established according to the procedure outlined in Article 31 of Directive 2014/24/EU."
The list of countries that have ratified the Agreement on Government Procurement prepared by the World Trade Organization is listed below.
Switzerland , Hong Kong (China), the EU with regard to its 27 Member States, Norway, Armenia, Australia, Singapore Canada, Chinese Taipei, Iceland, Israel, Japan, Liechtenstein, Montenegro, Moldova, the Netherlands with respect to Aruba, New Zealand, South Korea, Ukraine, and the United States.
GPA is a plurilateral agreement and not all members of the WTO are parties to the agreement.
The primary objective of the GPA is to establish mutual openness in government procurement markets among its parties. After several rounds of negotiations, parties to the GPA have opened procurement activities worth an estimated US $1.7 trillion annually to international competition. This means that suppliers from the parties to the GPA can offer goods, services or construction services in these markets.
The GPA mainly consists of two parts: the text of the Agreement and the market access schedules of commitments made by the parties.
Pricing calculations are of great importance to the contracting firm. We know that many large infrastructure projects have been liquidated due to incorrect pricing by major joint ventures. For example, in Sweden, the probability of revising your price offer in the tender file you submitted in the tender and submitting a new price offer is almost zero. Therefore, when preparing a bid for a tender in Sweden, we often tell our customers that this feature should be especially considered.