Same spec. Very different prices.
Public bids are a clean place to look: written specs, sealed bids, published results. We took 23 sets of published waterworks bid results from 13 cities and water authorities in 10 states, and measured how far apart competing vendors priced the identical line item.
The public bids show how prices can differ for the same item. Your quote history lets us look for similar patterns across customers and over time, giving your team context for the next quote.
How far apart do competing vendors price the same part?
The middle bid ran about 6% above the lowest bid on the same line, across 2,987 lines where suppliers priced the same item.
Variation around the average bid, expressed as a percentage of that average. We calculated it for each item, then took the middle result across the study.
Bid prices pulled from published bid results. Every figure can be re-checked at the public source.
Three examples from published bid results
Each row shows the lowest and highest bids for the same item. Select an item to see the original bid document.
The same part, a different price in the next town
We also matched identical items across different cities' bids: 186 matched items, strict enough to trust. Looking only at matches bid in the same year, the lowest bid for the same item typically differed by about 1.16 times from one city to the next. Compare bids years apart and the gaps look much bigger, but that extra gap grows with the years between the bids. Timing and changing costs may contribute; this comparison does not isolate the cause, so we quote the same-year number.
One more honest caveat: a delivered bid price also includes freight, terms, and volume. Some of the remaining gap is cost to serve, not list price.
When the spec is loose, prices scatter
The wild outliers we checked came down to two kinds of mix-up, same lesson both times. One vendor priced copper pipe per foot; another priced it per ten-foot stick. One read a 6-foot nipple as 6-inch. One bundled a fitting's ring into an accessory pack and left the standalone line blank. We found these differences by comparing the item descriptions, units and prices in the bid documents. The same mix-ups can ride into a customer quote unseen.
If public bids look like this, what does your book look like?
These are sealed bids with written specs and published results. Only the vendor changes. That is the fairest comparison we have. What it does not tell you is whether any distributor is leaving money behind: different vendors quoting different prices is competition. For your own quotes, we would need to check the context with you before drawing conclusions. Read the historical method review →
See the comparison and the questions it raises.
See how we can help you price your next quote.
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