The Nation’s Combat Logistics Support Agency E s t a b l i s h e d 1 9 6 1

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DLA Land and Maritime

Pricing Overview
Agenda

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• About Us

• Rules and Regulations

• The Buyer and Contracting Officer’s Responsibility

• Fair and Reasonable Price

• Tips on Pricing to DLA Land and Maritime
About Us

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• DLA Land & Maritime – Cost/Price Office

– Staff of 11 Analysts

• Monitors and ensures the integrity of the prices DLA Land 

& Maritime pays

• Provides guidance and training

• Provides input on policy

• Performs analysis & assists in negotiations

• For procurements requiring submission of certified cost 

data (>$2 million sole source), coordinates the data review 

with either DCMA or DCAA

• Performs reviews as required or requested
Rules of the Game -

Regulations and Policy

• FAR – Federal Acquisition Regulation

• DFARS / PGI – DoD Federal Regulation Supplement

• DLAD / PGI – DLA Directive Regulations

• PROCLTRS (Procurement Letters) supplements 

DLAD policy

• DAG – DLA L&M Acquisition Guide

• Contract Price Reference Guide

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The Buyer and Contracting 

Officer’s Responsibility

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• Conduct procurements in accordance to the listed policies 

and procedures.

• Purchase supplies and services from responsible sources 

at fair and reasonable prices. FAR 15.402 (a).

– Obtain the necessary data to establish a fair and 

reasonable price.

– Often Buyers and Contracting Officers will fact find and 

negotiate to obtain a fair and reasonable price.
What is a Fair and Reasonable Price?

• There is not a specific definition for “Fair and 

Reasonable Price” in the FAR, but it is mentioned a lot!

– But we generally view it as:

• Reasonable: A price that a prudent and 

competent buyer would be wiling to pay, given 

knowledge of

– Market Conditions

– Supply and Demand

– General Economic Conditions

– Competition

– Market Definition

– Relative Pricing

• Fair: Fair to both the seller and buyer

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What is a Fair and Reasonable Price?

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• As mentioned a Fair and Reasonable price is a price 

that is acceptable to both the buyer and seller (i.e., 

win-win outcome).

– “Profit” is not a dirty word and is necessary for 

companies to operate. We understand!

– But it should be reasonable

– DLA Land and Maritime is always interested in 

getting the best deal for the Warfighter and 

taxpayer!
Fair and Reasonable Takeaway

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• The Contracting Officer/Buyer is responsible on ALL 

procurements to determine whether the price is fair and 

reasonable

• The contractor is responsible for justifying their price as 

being fair and reasonable by providing adequate support
Methods to Determine a Price 

Fair and Reasonable

• For DLA Land and Maritime the most common analysis 

techniques used are:

– Cost Analysis

– Price Analysis

• There has been some questions from vendors about the 

possibility of their financial supporting data or certified 

cost or pricing data getting released.

• We DO NOT release your data to anyone outside of 

the government.

• You should mark all financial data as proprietary or 

business sensitive information.

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Cost Analysis

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• Cost Analysis is used when certified cost or pricing data 

is required but can be used in other instances

• Certified cost data is required for sole source 

procurements valued over $2 million

• Cost Analysis refers to review of the individual cost 

elements (i.e. Material, Labor, Overhead)

• This is where we will review your cost elements to come 

up with a position the Government believes to be fair and 

reasonable.
• It’s a comparison!

• A comparison of the proposed price to any of the 

following:

– Other offered prices for the procurement

– Previous/historic contract price

– Similar items

– Should Cost Estimate

– Market Research

– Catalog or Price Lists that have been in themselves 

determined fair and reasonable

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Price Analysis
Price Analysis

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• Price analysis is always performed

• Price analysis is concerned with the overall selling price 

not individual components.

• Two most common types of price analysis used:

– Comparison with other quotes/bids received

– Comparison with past procurement(s) that were 

determined fair and reasonable

• We will take into account quantity, inflationary 

factors, solicitation changes, economic conditions 

and any other factors that can affect the price.
Tips on Pricing to 

DLA Land and Maritime

• Review the solicitation and the requirements.

• Review the history listed on the solicitation.

‒ This would be close to where the Government 

position would be after taking into account quantity, 

inflationary factors and current economic condition 

adjustments.

• Provide your best offer, since you never know what your 

competition is doing.

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Tips on Pricing to 

DLA Land and Maritime

• Be prepared... The Buyers and Contracting Officers may 

call you to negotiate or obtain additional information 

concerning the item.

• When requested for an informal cost breakdown, we are

looking for the key drivers to the cost of the item such as

material, labor, overheads, profit, etc.

• Be open for fact finding and information gathering from 

the Buyers and Contracting Officers. The quicker you can 

get the information to them, the quicker they can make 

their decision concerning the procurement.

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