• KSCE Journal of Civil and Environmental Engineering Research
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• v.31 no.5D
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• pp.719-726
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• 2011

The government intensifies screening criteria for the guarantee of reasonable bidding price and the prevention of low bidding price, however, the low tender rate still becomes an issue. This study analyzed the problems of screening criteria for the guarantee of reasonable bidding price, and then derived some major issues such as the restriction of decisive factors for initial construction cost, the rate of activities over five percent of surveyed price and the restrictive review criteria of inadequate activities. To solve thess problems, this study suggests an improved process model for estimating optimal bidding rate that can select a contractor with the guarantee of reasonable bidding price.

• International conference on construction engineering and project management
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• 2007.03a
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• pp.106-118
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• 2007

Little attention has been focussed on a precise definition and evaluation mechanism for project management risk specifically related to contractors. When bidding, contractors traditionally price risks using unsystematic approaches. The high business failure rate our industry records may indicate that the current unsystematic mechanisms contractors use for building up contingencies may be inadequate. The reluctance of some contractors to include a price for risk in their tenders when bidding for work competitively may also not be a useful approach. Here, instead, we first define the meaning of contractor contingency, and then we develop a facile quantitative technique that contractors can use to estimate a price for project risk. This model will help contractors analyse their exposure to project risks; and also help them express the risk in monetary terms for management action. When bidding for work, they can decide how to allocate contingencies strategically in a way that balances risk and reward.

• Proceedings of the KIEE Conference
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• 1995.07b
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• pp.535-539
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• 1995

In recent years, electric industries in many countries confront with a structural change in business and socio-economic environments. Since 1984, PUC and utilities in U.S.A. have adopted or developing competitive bidding systems, and this new procurement programs prevailing and restructuring the power markets. In Korea, government and the Korea Electric Power Corporation (KEPCO) invited the private sector to build and operate two 500 MW coal plants and two 400 MW LNG plants during 2001 - 2004. The plan also specifies basic concepts and conditions for the IPP projects such that new IPPs are selected through competitive bidding system with the purchased power price based on the avoided cost. In this study, the direction, guideline and scoring methods to Korean IPP bidding system are presented. Also, as a benchmark price and rates for purchased power, the avoided cost calculation models are developed, this study may contribute for the development of private power in Korea, and improve overall economic efficiencies of whole electric power sector.

• Architectural research
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• v.8 no.1
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• pp.69-76
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• 2006

The purpose of this study is to suggest policies to improve the price escalation system in a construction contract through a Policy Delphi technique. The Delphi, including two times questionnaires and a group discussion, was conducted by joining 14 experts. Also, the escalation provisions of various countries were examined. Results of the Delphi showed that the minimum fluctuation rate for price escalation was desirable at a level of 3%. To compute the fluctuation rate, calculating the price fluctuation of overall articles was more desirable than using price indices. A bidding date was more reasonable as the initial date of change in price. Losses caused by price change should be shared between contractor and owner; therefore a deduction rate should be introduced in price escalation. Meanwhile, overhead and profit should be adjusted in proportion to the fluctuation rate; but advance payment or the delayed construction amount should be deducted from the adjusted amount.

• KDI Journal of Economic Policy
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• v.32 no.2
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• pp.144-170
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• 2010

This paper considers the effect of various types of procurement auction system on competition focusing on the rate of successful bidding. We analyze the number of bidders and the rate of successful bids using online procurement data of the Public Procurement Service. The average number of bidders is 301 and the average rate of successful bids is 87.42% while the weighted average rate is 75.13%. These numbers show that there is quite strong competition among bidders and the rate is lower as the expected price is higher. When we analyze the data of price procurement auction, the rate is also shown to be lower as the expected price is higher. Furthermore, the rate decreases as the number of bidders increases which naturally makes the competition stronger. Meanwhile, the analysis finds that the inclusion of the onsite bidding, the PQ(Pre-Qualification) result, or major-10 winning companies cannot explain the rate much in our data. In case of turnkey-alternative, the average rate of successful bidding for 484 cases record 90.20%. The average is 84.89% with 120 alternatives and 91.97% with 364 cases of turnkey. The reason why the rate of turnkey-alternative is lower than that of price procurement auction is the lack of competition as well as the systematic difference. By setting up a model, we are able to explain the difference in rate caused by the respective reason. When we suppose there are 3 bidders in case of price procurement auction for a project that exceeds 100 billion won, the rate is expected to be around 64%. This implies that difference of 26% is caused by the systemic difference and 3% by the lack of competition. Therefore, we conclude that the difference in rate between turnkey-alternative and price procurement auction is caused mainly by the systemic difference. In case of PPP(Public Private Partnership) projects, among 154 projects in total, only 40% has more than 2 bidders that compete. The average number of bidders is 1.88 which is less than 2, and the average rate of successful bids is 90%. In sum, under the price procurement auction, there is strong competition which is reflected by the rate of successful bids. However, there is room to decrease the rate by strengthening the competition under the turnkey-alternative. Also with PPP projects, we expect the rate can be steadily reduced with revived competition among bidders.

• Journal of Internet Computing and Services
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• v.2 no.2
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• pp.95-103
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• 2001

This paper implements the desirable-bid price type bidding agent system that enables internet bidding between buyer and sellers efficiently in real Time. The agent system controls the bid-limit to approach successful desirable-bid price of a buyer. to reduce unsuccessful bid rate using fuzzy-based bid-limit inference method.

• Asia-Pacific Journal of Business
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• v.13 no.1
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• pp.213-230
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• 2022

Purpose - The purpose of this study is to find out any potential factors for explanatory variables when calculating the virtual successful bid rate in case of no collusion. Design/methodology/approach - An empirical analysis was conducted in this study with a regression analysis that included 725 bid samples under the public construction technical type bidding. Findings - The result of the basic analysis showed that there are several factors affecting the successful bid rate. First, collusion variable; second, government variable; third, successful bidder design score variable and the number of bidder variable among bidding features; fourth, turnkey variable based on the alternative method; fifth, civil works variable and plant works variable based on building work; sixth, asset variable and the fourth-quarter performance difference variable. However, the technical proposal method variable among bidding features was found to be statistically insignificant in column(4). Research implications or Originality - The significance of this research is that new variable such as the government variable and the fourth-quarter performance difference variable were added in the regression model, which showed statistically significant research results.

• International conference on construction engineering and project management
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• 2013.01a
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• pp.479-487
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• 2013

State Highway Agencies (SHAs) have started utilizing cost-plus-time bidding (A+B bidding) since Federal Highway Agency (FHWA) declared it operational on May 4, 1995. Although this technique has successfully accelerated many projects by incorporating construction time in the bidding competition, a framework to illustrate the interactions of incentive/disincentive (I/D) rates on the competitiveness of contractors participating in the bid competition is yet to be developed. In a previous research, authors indicated that for each bid competition there is an efficient cap for I/D rates which are dictated by the capabilities of contractors in project acceleration. However, the results of previous study were based on the assumption that there is a statistically significant relationship between cost and time. In this study, the entire cost-plus-time projects implemented by the Oklahoma Department of Transportation (ODOT) were investigated. Then the significance of relationship between cost and time were analyzed for each contractor utilizing Analysis of Variance (ANOVA) technique, and the price-time function of each contractor was determined by regression analysis. The results of the analysis indicate that there is a significant relationship between cost and time for the majority of contractors. However, a quadratic relationship is not always significant and for some contractors a linear price-time relationship is significant. The results of this project can be used not only by ODOT to optimize the incentive/disincentive rates but also by contractors to determine the most competitive strategies of other bid participants.

• Korean Journal of Construction Engineering and Management
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• v.19 no.3
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• pp.52-60
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• 2018

Korea's public construction projects are under construction through bidding, however, due to the nature of the bidding, collusion between participants can occur. The collusion of bids accordingly damages the client. So, it is necessary to calculate the appropriate fictitious competition price to compensate for this. In this regard, econometrics methods are generally used, but there are limitations and issues arising from the nature of construction, especially design-build bid. Therefore, this study proposes a method to estimate reasonable competitive bid-price in design-build bid. It derives the lowest bid-price from the design submitted by the proponent and estimates the competitive bid-price by examining the factors according to the penetration rate according to the technical level of the tester, the skill level of the competitor, and the type of tester. Based on the method proposed in this study, a reasonable price can be derived that reflects the characteristics of the design and construction bidding bidder selection method and also it can be used as a reference material in the actual bidding process as well as calculating the damage due to the answer.

• The Journal of Society for e-Business Studies
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• v.7 no.2
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• pp.55-68
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• 2002

Internet group buying systems have been widely used recently. In those systems, because the reserve price is provided by the buyer, the success rate can be decreased if the reserve price is set too low compared with the normal price. Otherwise, an unsuitable successful bid can be made if the reserve price is set too high based on inaccurate information. Likewise, the seller's providing too high a bid price can deteriorate his/her own successful bid rate, whereas a successful bid with too low a price may make no profit in the sale. Therefore, pricing agents that recommend adequate prices based on the past buying and selling history data can be helpful. In this paper, we propose two kinds of agents. One suggests reserve prices to buyers based on the past buying history database of the system. The other recommends bid prices to a seller based on the past bidding history data of the company using the cost accounting theory. Through performance experiments, we show that the successful bid rate can increase by preventing buyers from making unreasonable reserve prices. Also, we show that, for the seller, the rate of successful bids with appropriate profits can increase. Using the pricing agents, we design and implement an XML-based group buying system.