How does a 'best value tradeoff' source selection process work?

In a best value tradeoff source selection, the government evaluates proposals based on factors beyond just price, allowing for an award to an offeror with a higher price if the contracting officer determines that the higher-priced offer's technical merit outweighs its additional cost. Federal buys using this method follow FAR Part 15, Contracting by Negotiation. The tradeoff means the contracting officer compares the strengths and weaknesses of each proposal's non-price factors (like technical approach, past performance, or management plan) against its proposed price.

The RFP should have outlined the evaluation factors and their relative importance in Section M of the solicitation. Typically, non-price factors are more important than price, or all factors are equally important. The contracting officer assesses each proposal against these criteria and may decide that a proposal with a higher technical score, even if it has a higher price, offers the "best value" to the government because its technical advantages are worth the extra cost. This differs from low-price, technically acceptable, where price is the primary differentiator among proposals that meet minimum technical requirements.