What is best-value procurement?
Best-value procurement is an evaluation method where the agency considers price plus non-price factors (technical approach, past performance, management plan) and awards to the offer that represents the best overall value — not necessarily the lowest price. It is the default for federal RFPs above the SAT.
Best-value source selection, defined in FAR 15.101, is the standard evaluation method for federal RFPs above the simplified acquisition threshold. Instead of just picking the lowest price (the rule for IFBs), the agency scores each proposal on multiple factors:
- Technical approach: how the vendor proposes to do the work - Past performance: track record on similar contracts - Management plan: staffing, schedule, risk management - Price: total cost of ownership over the contract period
Agencies use one of two best-value approaches:
Lowest Price Technically Acceptable (LPTA) is a hybrid: the agency sets technical thresholds, screens out non-compliant proposals, and then awards to the lowest-priced remaining offer. LPTA is appropriate when the requirement can be specified precisely and there is no meaningful benefit from a better technical approach.
Tradeoff is the true best-value method: the agency scores both technical merit and price, and explicitly considers whether a higher-priced offer with stronger technical merit is worth the price difference. The Source Selection Decision Document explains the tradeoff and is subject to bid-protest review.
For vendors, best-value contracts reward differentiation. You should not always be the cheapest — if your technical approach, past performance, or staffing materially differ from competitors, price your bid to capture that value.
State and local agencies often use best-value methods too, though they sometimes give it different names (Cost-Technical Tradeoff, Two-Step Procurement, Qualifications-Based Selection).