One of the primary conditions for cost eligibility in Horizon 2020 is that your suppliers be chosen in compliance with the “best value for money” rule.
What does it mean?
To start, it does not necessarily mean the supplier with the cheapest offer. Price is important, of course, but other issues must be considered as well. Qualitative aspects like delivery time, technical characteristics, qualifications and experience also carry weight in the final decision.
How to implement the best value for money rule
The simplest way is to follow your company’s standard procedures when buying goods or services. If you don’t have a procurement policy in place, it’s advisable to create one.
A good way to confirm best value for money is by getting three tenders (bids) from different suppliers.
Prepare a written explanation of why the selected supplier is the best choice for you. Criteria defining best value for money must be clear and consistent to support a proper analysis of price-quality ratios. The same criteria must be used for all of the entities offering a bid. You do not have to select the offer with the lowest price, but the price is a mandatory criterion.
You must also avoid conflict of interests when choosing suppliers.
Capital or personal connections (including family and emotional ties) between your company and contractors are forbidden.
The best value for money rule does not require competitive selection procedures in all cases.
However, if you did not request several bids you must be able to demonstrate how the rule was followed, for example with a market survey.
Finally, remember to keep all documentation from the selection process on file.
The EC may ask to examine these supporting documents in case of an audit.
Would you like more on how to implement the best value of money rule in your project? Contact firstname.lastname@example.org for more information and guidance.