Appendix 1

Ray: Do we need to look at other factors aside from costs to select among these vendors?

Patricia: No, we just want to look at the costs. All three are reputable and responsive vendors. Sarahs summary also has our forecast for the number of passengers to be handled at these gates.

Summary of Costs

(Prepared by Accounting)

After several meetings with vendors, the fixed cost and the variable cost proposed by each of the three vendors have been finalized. The results are shown in the table below.

	Fixed Costs	Variable Costs
American Airport Construction, Inc.	$800,000	$1500
National Airport Contracting Corp.	$900,000	$1200
Newark Airport Construction Corp	$700,000	$1800

Notes:

• The fixed costs for each vendor include all flooring, wall paneling, ceiling, electrical, telecom wiring, and plumbing work.
• The tasks to be performed by each vendor and the time estimates for completing each tasks have been finalized. In order to permit an Apple to Apple comparison of costs, all three vendors were asked to use the same time estimates.
• Eco-Jet will need to supply the final plans for wiring, electrical work, network jacks, and plumbing plans.
• Eco-Jet will also be responsible for acquisition of chairs, tables, ticket counters, fixtures, and other furniture. The vendor will be responsible for all installation.
• All three vendors have worked with Eco-Jet before and there is no significant difference between dependability and quality of vendors.
• The total variable costs will depend upon the peak hour design capacity of the gate area expressed in terms of the maximum number of passenger departures per hour.