Blanket Purchase Agreements and Basic Ordering Agreements

This newsletter is the last in a series of five newsletters about the federal government's increasing reliance on multiple award contracts.

Both agencies and vendors like BPAs and BOAs because they help trim the red tape associated with repetitive purchasing. Once set up, repeat purchases are easy for both sides.  A Blanket Purchase Agreement (BPA) is a method of acquiring a variety of goods and services from pre-approved venders. The federal buyer places orders through the BPA over the course of the year. BPAs are used by government agencies for simplifying the government purchasing process. A BPA between the government and a vendor allows purchasers authorized to use the BPA to place orders by telephone or in person with simplified documentation.

BPAs are like "charge accounts" set up with trusted or qualified suppliers. In most instances, the government has done business with your company in the past and government buyers know that you have good prices and provide value. Normally the trust would have been established through a prior contract, which can be used to establish the terms and conditions of the BPA. In fact, the federal government often uses BPAs in conjunction with GSA Schedule contracts, the latter of which establish the purchasing terms and conditions and the pricing. 

A Basic Ordering Agreement (BOA) is a written instrument of understanding negotiated between a procuring activity and a contractor that contains: (1) terms and clauses applying to future contracts (orders) between the parties during its term; (2) a description of supplies or services to be provided; and, (3) methods for pricing, issuing, and delivering future orders under the BOA.

BPAs and BOAs are very similar in nature in that they are basic agreements that are put in place once the government identifies items used on a repetitive basis. However, they differ in their use in that BPAs are for anticipated requirements and use the terms and conditions contained in vendors' existing GSA Schedule contracts (or other contracts). BOAs are used when future needs are undetermined. These agreements contain their own specific terms and conditions. Neither BOAs nor BPAs are considered binding contracts until orders are placed against them. Those orders become the binding contracts.


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