Limited Source Bidding, also known as Selective Bidding, is a specific method used in procurement. It differs from open bidding processes by restricting the participants to a select group.
Understanding Limited Source Bidding
Based on the provided reference, Limited Source Bidding is defined as:
"LIMITED SOURCE BIDDING, otherwise known as SELECTIVE BIDDING, is a method of procurement of goods and consulting services that involves the issuance of a direct invitation to bid by the concerned Procuring Entity to a set of pre-selected suppliers or consultants with known experience and proven capability on the ..."
This means that instead of opening the bidding process to potentially any interested party, the Procuring Entity (the organization needing to purchase goods or services) identifies and directly invites a limited number of suppliers or consultants.
Key Characteristics
Several key characteristics define this procurement method:
- Alternative Name: It is also widely recognized as Selective Bidding.
- Scope: It is applicable for the procurement of both goods and consulting services.
- Process: It involves issuing a direct invitation to bid.
- Participants: Invitations are sent only to a set of pre-selected suppliers or consultants.
- Selection Basis: The pre-selection is based on the suppliers' or consultants' known experience and proven capability.
Why Use Limited Source Bidding?
While the reference does not explicitly state the reasons, this method is typically employed in situations where:
- The goods or services required are highly specialized, and only a few entities possess the necessary expertise or technology.
- Previous positive experience with specific suppliers makes direct invitation a more efficient or reliable option for certain projects.
- Security or proprietary concerns limit the pool of potential providers.
By focusing on pre-qualified entities, the procuring entity can streamline the evaluation process and potentially mitigate risks associated with inexperienced bidders.
Limited vs. Open Bidding
Here's a simple comparison:
| Feature | Limited Source Bidding (Selective Bidding) | Open Bidding (Public Bidding) |
|---|---|---|
| Invitation | Direct invitation to pre-selected few | Public announcement inviting all interested |
| Participants | Limited set of known, capable suppliers/consultants | Any eligible supplier/consultant |
| Basis | Known experience and proven capability | Generally based on meeting minimum requirements |
| Process Length | Often shorter evaluation phase | Can have longer evaluation due to volume |
Limited Source Bidding is a valuable tool in a procuring entity's arsenal for acquiring goods or services, particularly when specific expertise or a proven track record is paramount.
