Baylis, Ill., farmer Jerry Moss uses bid sheets to get the best prices for inputs. More important, it keeps suppliers competing for his business.
“A bid sheet forces the input supplier to not take your business for granted,” says Moss. “We have relationships with suppliers and like to keep them, but there may come a point in time that I have to be sure you’re giving me the best price.”
We have provided a sample bid sheet for you to download. You can customize it with your farm contact information, then send it to suppliers to ask for competing bids for your business.
Bid sheets may not make sense in every buying situation. Sometimes it’s impossible to put dollar value on relationships, or a particular kind of timely service. However, when you need the best, most competitive price at a certain volume delivered at a certain place or time, bid sheets may be the answer.
University of Purdue economist Mike Boehlje and his colleagues put together a worksheet to help farmers begin to think of themselves as procurement officers in a business. This downloadable ‘specification sheet’ can help you think about the criteria needed to make good decisions.
“This is how it’s done in the industrial sector,” he says. “It doesn’t mean all you worry about is price, but it does help frame the thinking process so you put all dimensions into the proper context as you think about purchasing decisions.”
For bid sheets to work you need to look at every aspect of the deal: Do I get a special interest rate, services, timeliness of the service or delivery? Do I get vendor financing at rates lower than my bank?
To get a true price comparison for fertilizer you need to start with an independent soil tester who will check soil pH and fertilizer levels. Once tests are complete have a consultant make recommendations on how many tons of fertilizer or limestone are needed. Then contacts three suppliers and ask them to bid for your business. You can take the same approach for chemical and seed, assuming you have more than one supplier to call.
Download the Bid Sheet - Word doc
Download the Bid Sheet - Adobe PDF
Download the Spec Sheet - Word doc
Download the Spec Sheet - Adobe PDF