2019 DLA Energy Worldwide Energy Conference May 2022 2019 Bulk Bid Evaluation Model Bulk Fuels Business Model 2 Procure petroleum products in very large volumes Fewer contracts with large dollar values ID: 916118
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Slide1
Matthew Shuster
Supplier Relationship Manager
2019 DLA Energy Worldwide Energy ConferenceMay 20-22, 2019
Bulk
Bid Evaluation Model
Slide2Bulk Fuels Business Model
2
Procure petroleum products in very large volumes Fewer contracts with large dollar values Estimated quantity with high minimum lift guarantee (75 percent)
Awards on FOB Origin and FOB Destination basis
Extensive use of commercial distribution systems (pipeline and truck)
Distribution may be direct to demand point or through intermediate defense fuel support
p
oints
Socio-economic considerations
Small business set-asides (price
m
atching)
HubZone
Premium Program
8(a) reservation
Slide3Bid Evaluation
Model
3The Bulk Bid Evaluation Model, also known as BEM, is a mixed-integer linear optimization program used to find the minimum laid down cost for the entire requirements of a purchase program
Laid
down
p
rice
includes:
Offered
product price
All transportation costs
All additive costs
All intermediate
defense fuel support point
distribution costs (fixed and variable costs)
Excess
throughput charges
Unique
costs for specific receipt
mode
Offer specific evaluation factors
Base reference price evaluation factors
Offer conditions
Slide4Offer
Conditions
4 Offer ConditionsOptional
BEM evaluates complex
offers
Tiered pricing
Block pricing
Volume restrictions (Minimums and Maximums)
Multiple load capabilities (modes of transportation)
Parcel size limitations
Additive injection capabilities
Offer conditions such as
“Either/Or”
and
“One
before
Two”
Conflicting
Conditions
Conditional
statements
must
not conflict with each other (
i.e., minimum
award by
tanker
is 5 million and
overall
maximum award is 3 million)
Slide5Evaluation Example
5
OffersA: 6,000,000 USG by TT @ $2.95/gallonB: 6,000,000 USG by PL @ $3.00/gallon
C: 1,000,000 USG by PL @ $
2.98gallon
Requirements
Base 1: 3,000,000 gallons received by TT
Base 2:
3,000,000
gallons received by TT
Base 3:
1,000,000
gallons received by TT
Intermediate Depot
Support Available
Into X by PL, out by TT to all Requirements
Into Y by PL, out by TT to all Requirements
Transportation Rates
A to 1 (TT): .28/gallon
A to 2 (TT): .20/gallonA to 3 (TT): .23/gallonB to X (PL): .02/gallonB to Y (PL): .02/gallonC to X (PL): .01/gallonC to Y (PL): .04/gallonX to 1 (TT): .05/gallonX to 2 (TT): .02/gallonX to 3 (TT): .05/gallonY to 1 (TT): .04/gallonY to 2 (TT): .06/gallonY to 3 (TT): .02/gallon
PL = Pipeline; TT = Tank Truck
Offer A
6,000,000 USG @$2.95
Offer C1,000,000 USG @$2.98
Offer B6,000,000 USG @$3.00
DFSP X
DFSP Y
Base 31,000,000 USG
Base 23,000,000 USG
Base 13,000,000 USG
.28
.02
.05
.01
.02
.05
.02
.04
.02
.04
.20
.23
.06
Req
1 – Offer A (total cost $3.23/gal)
Req
2 – Offer A (total cost $3.15/gal)
Req
3 – Offer C (total cost $3.04/gal)
Total cost: $22,180,000
Req
1 – Offer B (total cost $
3.06/gal
)
Req
2 – Offer C (total cost $3.01/gal)
Req
2 – Offer B (total cost $3.04/gal)Req 3 – Offer B(total cost $3.04/gal)Total cost: $21,310,000 $870K SavingsDistribution Plan Generated
Evaluated on Offered Price Only:
Evaluated on Laid-Down Cost:
Slide6BEM Rounds
6
Slide7BEM
Minimum Cost
Bid Evaluation Worksheet7
Slide8Laid Down Cost Report
8
Slide9Sequence of BEM Runs
9
Final Forced Run
Small Business Set-Aside Run
HUBZone
Run
8(a) Run
Base Run
Slide10Post Award
10
Once the solicitation is awarded, the BEM reports will be published on Federal Business Opportunities website
at
https://www.fbo.gov
/
For questions specific
on
an offer, please contact the
contracting
o
fficer
listed on the
solicitation
Slide11Contact Information
11
For questions concerning the functionality of BEM/OET, please contact:
Matthew Shuster
Matthew.Shuster@dla.mil
Wo
rk
: (571) 767-9250
12
QUESTIONS
Slide1313