Parametric Negotiations

Parametric negotiations refer to crafting a “bottoms-up” strategy; detailing cost drivers for a given commodity, manufactured product, or service. Bidders are required to detail cost components; which can then be analyzed and compared to baseline values & competing bids.

The Sourcing Manager can specify the level of granularity required of bidders.

The intent of this analysis is to perform a “reality check” on cost drivers; foster a credible base of knowledge relative to individual cost components; and to determine optimal results in terms of bid price.