Comment Re:doesn't matter what you call it (Score 1) 204
True - the last customer in the supply chain always pays everyone's costs and margins or the product dies. What bonding-on-bid does though is force suppliers to get insurance before signing on contractual commitments thereby achieving two aims:
- A) levelling the playing field between those who pre-emptively had their backsides covered and those who don't
- B) filtering out all potential players for whom the market can not find a palatable cost at which to price their risk
Insurance is important in most trades.