Every tender committee has sat through it: the lowest landed-cost bid wins, and six months later the item is on back-order, the alternative is being bought at spot price, and the clinical team has quietly switched brands. The award saved 8% on paper and cost 15% in practice. The fix is not to ignore price; it is to score four other things alongside it, with weights agreed before the bids are opened.
The five lines
1. Landed cost (40–50%)
Unit price plus freight, insurance, duty, clearance and any registration or sample costs, converted to one currency, per unit of use — per gram of antibiotic, per test, per procedure — not per pack. Normalising the unit is half the work.
2. Lead time and reliability (15–20%)
Quoted lead time, but also the supplier’s record: fill rate, on-time delivery, back-orders in the last year. For imported items, whether stock is held in-country. A supplier with a local warehouse and a 95% fill rate is worth a premium that most price-only tenders never capture.
3. Validity and price stability (10%)
How long the price holds, what indexation applies, and whether the supplier will honour the price if volumes fall short. A 12-month fixed price beats a 5% discount that expires in 90 days.
4. Compliance (10–15%, often pass/fail)
Registration with the relevant authority (MOHAP, DoH, DHA, SFDA, CDSCO), certificates (ISO 13485, CE, FDA, WHO-GMP), serialisation readiness, and for pharmaceuticals the remaining shelf life on delivery. Treat the mandatory items as a gate, then score the rest.
5. Service and total cost of use (10–15%)
Training, consignment or vendor-managed inventory, equipment loan terms, returns policy, and the hidden cost of a product that takes longer to use or wastes more. For consumables used with equipment, the compatibility and the equipment contract matter more than the consumable price.
Making it defensible
Publish the weights in the tender document. Score each bid independently, then meet. Record the scores and the reasons in an award pack the approver signs. That pack is what an auditor, a board member or a losing bidder will ask for, and having it is what lets you award to the second-cheapest bid with confidence. Our Tender Comparison Template does exactly this for up to six bids, with the award pack built in.
One number to remember
Across the tenders we have run, the price-only winner and the five-line winner are the same supplier roughly 60% of the time. In the other 40%, the five-line winner was 2–6% more expensive at award and cheaper within the year. That 40% is where procurement earns its keep.