Space Systems Consultancy

Support in Contract Negotiations

SCI can  assist its client in drafting the best suited terms and conditions for the spacecraft delivery, the system acceptance and other issues related to payment plan, warranty pay-back, incentives, etc.

Two approaches for managing the contract negotiation with the short-listed bidders are often proposed :

The first approach consists of issuing a final set of requirements and requesting the selected bidders (short list) to make a “best and final offer” (BAFO). Then the new proposals, which do not really differ technically or contractually from the previous ones, will be analysed. In this approach, the most important differentiator is usually the price. The advantage of this strategy is the time saving, since the contractual negotiation is short. However, since the final contract terms for a complete comparison are not yet fully detailed, some difficulties may appear later during the final contract negotiation with the selected bidder.

The second approach consists of negotiating, in parallel with the selected bidders, all the details of the final contract. This approach has the advantage of allowing a fully detailed comparison between the selected bidders, and minimizing the risk during the final negotiation with the successful bidder. However, this approach is more time consuming, particularly at the beginning of the negotiation process, than the first approach.

If the first approach is chosen, a document requesting modifications to be taken into account is issued for each short-listed bidder, as well as the final commercial conditions.

If the second approach is chosen, parallel negotiations with each short-listed bidder are undertaken to arrive at a fully detailed contract.

At the end of one or the other approach, the client is in aposition to select, with full knowledge, the manufacturer who will realise its space system.

Satel Conseil International - 3 rue de l’Arrivée, BP 260 Tour CIT Cedex - 75749 Paris Cedex 15, France
Tel.: +33 1 42 73 66 56 - Fax: +33 1 42 73 66 54 -
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