Glossary / Evaluation, Acquisition
Trade-Off (Best Value)
Trade-Off (also called 'Best Value Trade-Off') is a source-selection approach under FAR 15.101-1 in which the source-selection authority can trade lower prices against higher technical, management, or past-performance ratings to select the best-value proposal. The contrasting approach is LPTA. Section M of the solicitation tells offerors whether trade-off applies and the relative importance of price versus non-price factors (e.g., 'technical is significantly more important than price' or 'approximately equal'). Trade-off is the usual approach for complex negotiated acquisitions.
Why it matters to your pipeline
Under trade-off, price is not decisive, so a firm with superior past performance and technical approach can win at a higher price. This structure rewards investment in differentiating capabilities, strong capture, and disciplined proposal development. However, price must still be realistic and reasonable; trade-off is not a license to ignore price competitiveness. Many losses in close trade-offs stem from price-realism risks the contractor failed to address.
When this term shows up in an opening GovSmith finds for you, your vCM explains what it means for that pursuit and does whatever it calls for. You decide; we do the work.
Example
On a close $28M trade-off, Firm A bids $28.2M with 'Exceptional' past performance and 'Outstanding' technical. Firm B bids $25.1M with 'Very Good' past performance and 'Good' technical. The SSA trades Firm A's $3.1M price premium for superior non-price ratings and selects Firm A.
Find out what applies to you
Some terms will matter to your business right away and some won’t for years. A vCM can tell you which are which.