Public tendering implies the free concurrence and competition of bidding companies that certify their solvency, so that those companies proposing the most attractive bid, both technically and economically, are awarded the contracts and carry them out according to the same terms and conditions that they proposed. Generally, there is high competition in public tendering, both concerning the number of bidders (constantly increasing), as well as the profit margin (constantly decreasing). On the other side, handling the procurement process, there is a contracting authority that spends public money while trying to fulfill a particular socio-economic objective. This paper will take the contracting authority's (auctioneer's) point of view which is in charge of devising and implementing the awarding criteria, as well as choosing the best bidder. Particularly, this paper will focus on some aspects of the Economic Scoring Formula (ESF) design. The ESF constitutes a set of mathematical expressions that transform the economic bids submitted by the bidders into scores, so that, eventually, the bidders can be ranked and the best one selected. We will conclude that, despite apparently simple, how ESF are configured eventually have profound consequences on bidding behavior and some bidding results, like a higher or lower bid dispersion.
Modeling bidding competitiveness and position performance in multi-attribute construction auctions