Price fixing is a critical economic factor that determines the price at which various traders across the globe sell their goods and services. A point to note is that for the price fixing to be fair and just to consumers, government regulations are essential. It is for this reason and no other reason that the federal government has two major concerns for price fixing (Connor, 2001). The federal government is greatly concern with any agreement or collusion made by the competitors in price fixing. Secondly, bid rigging is another major concern for the federal government. My primary concern is the latter, because bid rigging in several cases has led to significant commercial contracts being allocated to unqualified and ineptitude contractors. The above is an open loop hole for fraud.
There are two major factors that companies must incorporate before selling its products to the government. The cost of production is a primary factor for consideration. It is through the cost of production that the company determines its end profit. Secondly, a company needs to determine the prices at which the competitors are selling a similar product (Connor, 2001).
VectorCal being navigating system producer meticulously considers the type of contract and the duration. Apparently, the type of contract offered must be in line with what the company produces. Similarly, the duration of the specified contract must be clearly stipulated and agreed upon by all stakeholders. For instance, the VectorCal Company specializes in the production of stealth drone aircrafts. The mentioned drones must be in line with the company specialization. These two factors determine the fair price at which the company sells its product to the government. The government ought to pay the proposed reasonable price because the VectorCal company production is not only timely, but also of desirable quality.
Reference
Connor, J. M. (2001). Global Price Fixing: Our Customers are the Enemy. USA: Springer Science & Business Media.
