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10 Signs of Possible Vendor Collusion


While most vendors are fair competitors, price-fixing and bid-rigging schemes can and do happen. Watch for certain red flags to help determine if vendors may be colluding.

Bid rigging occurs when competitors agree on who will submit the winning bid, how much they will bid, or any other terms of the contract. 

Red flags of possible bid-rigging among vendors include: 

  1. Unexpected similarities in the bids of different vendors, such as documents all having the same unusual font, postage stamps, math errors, spelling errors, postmarks, fax number, or contact person.
  2. Geographical patterns, where the same vendors consistently win the same geographical areas.
  3. Bid rotation patterns, where different vendors win contracts in succeeding years in a predictable order.
  4. For electronic bid submissions, similarities in the documents’ metadata, such as the author’s name.
  5. Evidence of haphazard, last-minute changes to bids, such as white-outs, erasures, or other physical alterations that indicate the changes happened during a conversation among bidders (perhaps just moments earlier in a parking lot).
  6. References to “industry-wide” or “association-set” price schedules and blanket statements such as “all the businesses in this industry charge the same” or “there’s no difference in product, and that’s why prices are the same.”
  7. Statements that a bid was a “courtesy,” “token,” or “cover” bid or that indicate advance, non-public knowledge of a competitor’s pricing or the specifics of a competitor’s bid.
  8. A suggestion that the bidder has discussed prices with competitors or that it is the bidder’s “turn” to win a bid or contract.
  9. A reference to “my customer,” “my contract,” or “my territory” (except when referring to territories established by a distributor).
  10. Any statements that a company has been meeting with its competitors (whether at a social outing, trade association conference, or business meeting) where pricing and contract specifics were discussed.

Keep in mind that these indicators may arouse suspicion, but by themselves, they are not proof of collusion. 

If you have a suspicion about bid activity, report it through the appropriate channels in your organization and consider submitting a tip to the Ohio Attorney General’s Office. The information you provide could help uncover a more widespread problem or warrant an investigation.