Multicriteria contractor selection in practice

Paper in proceeding, 2005

Public clients increasingly use multiple criteria instead of lowest price when awarding construction contracts. This investigation gives a clear picture of how municipalities identify new award criteria and assign weights to these when abandoning the traditional lowest bid-criterion. Bidding documents from a sample of 386 Swedish municipal construction contracts procured in 2003 have been analyzed. Result show that public owners in the sample used the lowest bid criterion for 19 per cent of their contract awards. The average price weight was 65 percent and these owners used three award criteria on average. Some bidding documents provide thorough descriptions of post-bid evaluation procedures while others give little information on how bids are to be evaluated. The development of advanced contract award criteria in the public sector, as presented here for the first time, will provide incentives for contractors to improve their skills and internal routines, thus increasing efficiency and quality in the construction sector.