A price is considered based on adequate price competition when which of the following criteria are met?

A price is deemed to be based on adequate price competition when offers from two or more responsible offerors are present. This condition is essential because the presence of multiple responsible offerors promotes a competitive environment that can lead to better pricing for the government or organization seeking to procure goods or services.

When there are at least two responsible offerors, it ensures that the procurement process has enough competition to help validate that the price is fair and reasonable. The competition among these offerors is likely to drive prices down and encourage more value-added proposals. This standard helps to safeguard the integrity of the contracting process and assures that the buyer is not settling for inflated costs due to a lack of options.

In scenarios where there is only one offeror or less than two, there is a risk of inadequate price competition. For example, offers from just one party, whether responsible or not, may not reflect a competitive market price, as there is no opportunity for negotiation or further competition. Thus, having two or more competing offerors is key to affirming that the obtained price reflects the market dynamics and is based on adequate competition.