538.270-1 Evaluation of offers without access to transactional data.

(a) Applicability. Utilize this evaluation methodology for negotiating MAS offers when the commercial sales practices format is included in the solicitation (see 515.408).

(b)  When offerors have commercial catalogs, negotiate concessions from established catalogs, including price and non-price terms and conditions.

(c)  The Government will seek to obtain the offeror’s best price (the best price given to the most favored customer). However, the Government recognizes that the terms and conditions of commercial sales vary and there may be legitimate reasons why the best price is not achieved.

(d)  Establish negotiation objectives based on a review of relevant data and determine price reasonableness.

(e)  When establishing negotiation objectives and determining price reasonableness, compare the terms and conditions of the MAS solicitation with the terms and conditions of agreements with the offeror’s commercial customers. When determining the Government’s price negotiation objectives, consider the following factors:

(1)  Aggregate volume of anticipated purchases.

(2)  The purchase of a minimum quantity or a pattern of historic purchases.

(3)  Prices taking into consideration any combination of discounts and concessions offered to commercial customers.

(4)  Length of the contract period.

(5)  Warranties, training, and/or maintenance included in the purchase price or provided at additional cost to the product prices

(6)  Ordering and delivery practices.

(7)  Any other relevant information, including differences between the MAS solicitation and commercial terms and conditions that may warrant differentials between the offer and the discounts offered to the most favored commercial customer(s). For example, an offeror may incur more expense selling to the Government than to the customer who receives the offeror’s best price, or the customer (e.g., dealer, distributor, original equipment manufacturer, other reseller) who receives the best price may perform certain value-added functions for the offeror that the Government does not perform. In such cases, some reduction in the discount given to the Government may be appropriate. If the best price is not offered to the Government, you should ask the offeror to identify and explain the reason for any differences. Do not require offerors to provide detailed cost breakdowns.

(f)  You may award a contract containing pricing which is less favorable than the best price the offeror extends to any commercial customer for similar purchases if you make a determination that both of the following conditions exist:

(1)  The prices offered to the Government are fair and reasonable, even though comparable discounts were not negotiated.

(2)  Award is otherwise in the best interest of the Government.

(g)  State clearly in the award document the price/discount relationship between the Government and the identified commercial customer (or category of customers) upon which the award is based.