Benchmarking is the systematic comparison of prices, terms, processes or performance against a reference point — the market, peer companies or your own past awards.
Types. Price benchmarking compares what is paid; process benchmarking compares how efficiently buying works. Internal benchmarking compares units or sites; external benchmarking uses market or industry data.
In services. List prices say little. Compare effective day rates and team mix by seniority level, normalised for delivery location and pricing model.
Use. Provides targets for negotiation and the savings baseline. It does not replace negotiation; it gives it a basis.
Synonyms: Price Benchmarking, Rate Benchmarking