This series includes positions that manage, supervise, perform, or develop policies and procedures for professional work involving the procurement of supplies, services, construction, or research and development using formal advertising or negotiation procedures; the evaluation of contract price proposals; and the administration or termination and close out of contracts. The work requires knowledge of the legislation, regulations, and methods used in contracting; and knowledge of business and industry practices, sources of supply, cost factors, and requirements characteristics.
Positions in this series are concerned with: (1) soliciting, evaluating, negotiating, and awarding contracts with commercial organizations, educational institutions, nonprofit organizations, and State, local or foreign governments for furnishing products, services, construction or research and development to the Federal Government; (2) administering contracts by assuring compliance with the terms and conditions of contracts, including resolution of problems concerning the obligations of the parties; (3) terminating contracts by analyzing, negotiating, and settling claims and proposals; (4) analyzing and evaluating cost or price proposals and accounting systems data; (5) planning, establishing, or reviewing contracts, programs, policies, or procedures; (6) formulating and administering policies and procedures to insure achievement of Federal socioeconomic goals, such as those affecting small business, labor surplus areas, and disadvantaged business firms; (7) developing acquisition strategies and directing or managing procurements; and (8) providing staff advisory services in one or more of the specializations in this occupation.
Contracting, procurement, and acquisition are terms used interchangeably throughout this standard to denote the process of acquiring goods and services for the Government from commercial or noncommercial sources when and where they are needed, at the most reasonable price, and in accordance with applicable laws and regulations. Basic statutes provide the foundation for the framework of Government contracting. Approximately 4,000 additional statutes address elements of the contracting process, such as the Small Business Act which prescribes rules for small business participation in the Federal procurement process, socioeconomic legislation which establishes policies for the achievement of Government socioeconomic goals, and legislation governing the procurement of various categories of items, including automatic data processing, public buildings, architectural and engineering services, and construction services.
1. REQUIREMENTS DETERMINATION
The procurement process begins with the determination of requirements needed to accomplish the agency mission. The program office is responsible for the initial determination that the requirements can or cannot be fulfilled from within the Government, such as from existing stock or inhouse capability, for preparing preliminary specifications or work statements, for recommending delivery requirements, and for assuring the availability of funds. The document transmitting this data to the contracting office is a procurement request. The contracting office provides assistance in developing acceptable specifications, work statements, and evaluation criteria; determines the method of procurement and contractual arrangement appropriate to the particular requirements; and conducts the contracting process.
The contracting office first screens the procurement request to assure its completeness for contracting purposes, then develops an overall plan designed to obtain the requirements in the most economical, timely, effective, and efficient manner. The plan embraces the entire procurement process from the inception of a program to completion of the contract. It may be simple or complex, depending on the circumstances of the particular requirement. It includes such fundamental considerations as funding, contracting method, contract type, source competence, number of sources, source selection, delivery, Government-furnished property, possible follow-on requirements, and contract administration. It should include the means to measure accomplishments, evaluate risks, and consider contingencies as a program progresses. It should also include market research and analysis and other considerations as necessary to achieve the program objective.
Typical requirements are the following:
(a) Supplies -- Commodities range from commercial off-the-shelf products, components, or spare parts, to unique items requiring fabrication to specification.
(b) Services -- Services include professional or nonprofessional, such as research for a specified level of effort, field engineering work requiring specialized equipment, the delivery of a series of lectures, or provision of janitorial services to perform specific tasks in specific locations. When contracting for services, competition may be based on both price and technical considerations.
(c) Construction B This includes construction of public buildings repair or alteration of building structures, hospitals, prisons, mints, dams, bridges, power plants, irrigation systems, highways, roads, trails, and other real property. Construction contracts have a variety of special requirements which must be followed.
(d) Automatic Data Processing Equipment and Telecommunications -- ADPE acquisition, with supporting software, maintenance, and services is governed by a separate statute and special regulations. Telecommunications consist of local and intercity telephone services, radio service, audio and visual service, and equipment associated with these services. In ADPE and telecommunications contracting, competition is based on both price and technical considerations.
(e) Research and Development -- Research and development contractors are selected primarily for technical considerations, although a thorough evaluation and comparison of all relevant business, price, and technical factors are required for meaningful source selection. Technical evaluations are directed both to the proposal itself and to the contractor's capabilities in relation to it.
(f) Major Systems -- Major systems are the combination of elements, such as hardware, automatic data processing equipment, software, or construction that will function together to produce the capabilities required to fulfill a mission need. Major systems acquisition programs are directed at and critical to fulfilling an agency mission, entail the allocation of relatively large resources, and warrant special management attention. No two are identical and involve such differences as time, cost, technology, management, and contracting approach. Major systems are designated as such by the agency head according to a variety of criteria (discussed below) established by the Office of Management and Budget and by the individual agency. Examples of large procurements, some of which are designated as major systems and are subject to major systems acquisitions policies and procedures, are: Federal office buildings; hospitals; prisons; power generating plants; dams; energy demonstration programs; transportation systems; ship, aircraft, or missile systems; space systems; and ADP systems designated as major systems.
The major systems acquisition process generally involves the following steps:
Mission analysis. When the need for a new capability is identified, an appropriate document is submitted for the approval of the agency head, the President, and subsequently, the Congress.
Exploration of alternative systems. Approval of the new capability is the authority to explore alternative system design concepts, as well as other methods for satisfying the need. A program manager is usually designated at this point, and an acquisition strategy developed. Solicitations are developed and sent to a broad base of qualified firms; proposals are evaluated; and parallel short-term contracts are awarded for further exploration of the concepts selected.
Competitive demonstrations. The design concepts selected for competitive demonstration are submitted to the agency head for approval. Demonstrations normally involve some form of prototype.
Full scale development, test, and evaluation. The winning concept(s) and contractor(s) of the demonstration evaluation move into full-scale development and initial production. Initial production units are tested and evaluated in expected operational conditions.
Production. Following satisfactory test results, the agency head may authorize full production. (This step does not apply to production of a limited quantity, such as one hospital.)
Deployment and operation. As systems are produced, they are deployed into operational use, thereby providing the new capability originally identified.
2. METHODS OF CONTRACTING
As authorized by legislation, contracting is accomplished by two basic methods-formal advertising and negotiation -- for acquiring services and products from the private sector for the Government. Formal advertising is the preferred method by statute. However the law provides exceptions that permit negotiation in those situations where formal advertising is not appropriate.
A. Formal advertising is used when all the following conditions exist: (1) definitive specifications are used; (2) adequate competition is expected to be available; (3) selection can be made on the basis of the low responsive, responsible bidder; and (4) sufficient time exists to solicit, receive and evaluate bids, and determine the responsibility and responsiveness of the low bidder. Procedural steps in formal advertising involve: (1) preparing an invitation for bid which includes a complete technical description of the item or construction desired, delivery and other terms and conditions, and the mandatory or optional provisions and clauses of the proposed contract; (2) publicizing the requirements; (3) issuing the solicitation document; (4) receiving the bids and publicly opening and recording sealed bids; (5) reviewing the bids for responsiveness to the solicitation; (6) determining financial responsibility and performance capability of the low bidder; and (7) awarding the contract to the responsible bidder with the lowest priced responsive bids.
A variation is two-step formal advertising, a procedure which is used when the specifications are not sufficiently complete, requiring technical proposals to be submitted and evaluated prior to submission of priced bids. Only those bidders whose proposals are technically acceptable may then submit price bids on their respective technical proposals in step two, which proceeds as does straight formal advertising.
B. Negotiation is used when formal advertising is not appropriate and there is justification under one or more of the statutory exceptions to formal advertising. The negotiation method provides for the Government to discuss and explore with one or more offerors the soundness or reasonableness of their offer. Competition is obtained on every solicitation unless it is impracticable and sole source procurement is justified in writing.
Contract negotiation entails: (1) reaching agreement with a proposed contractor on the pricing, performance, and technical terms and other provisions; and (2) setting forth these terms in a document that technically, contractually, and legally protects the Government's interests in order to ensure delivery of acceptable items in time to meet operating needs.
Procedural steps include: (1) preparing a written request for proposal which includes a technical description of the services, supplies, equipment, or material desired and the delivery and other terms and conditions; (2) publicizing the requirement to include soliciting potential sources of supply for offers; (3) issuing the solicitation document (request for proposals); (4) analyzing offers received; (5) preparing a Government negotiation position; (6) meeting with suppliers or their representatives (private individuals, commercial or industrial concerns, educational institutions, or others) to discuss, develop, or revise their offer; (7) determining financial and performance capability; (8) evaluating technical and cost proposals, establishing competitive range for purpose of conducting negotiations; (9) negotiating cost, fee or profit, and technical issues; (10) selecting proposal that is in the Government's best interest from cost and technical viewpoints; (11) entering into a formal contract between the Government and an offeror; (12) documenting how a reasonable agreement was reached in a negotiation memorandum.
3. TYPES OF CONTRACTS
There are numerous types of contracts which provide the flexibility needed to purchase the large variety and volume of supplies, services, construction, and research and development, and to balance risks both to the Government and to the contractor in the areas of cost, schedule, and technical factors. Influencing the selection of contract type are such considerations as: (a) the nature of the item or service required; (b) the difficulty of estimating costs or the availability of comparative cost data; (c) the degree of risk involved for the contractor; (d) the adequacy of the contractor's accounting system; and (e) the administrative costs of various contract types.
Major categories of contract pricing arrangements are:
Fixed-Price Contracts which are based on the establishment of a firm or ceiling price, or under appropriate circumstances an adjustable price, for goods and services being procured. These include: (a) firm fixed-price, (b) fixed-price with economic price adjustment, (c) fixed-price redeterminable, (d) fixed-price with incentive provisions, and (e) firm fixed-price level of effort term. Under fixed-price contracts, the contractor assumes full responsibility and financial risk for performing the work at the ceiling price agreed upon (unless contractually modified), regardless of the contractor's actual cost.
Cost Reimbursement Contracts which are based on reimbursement or payment by the Government to a contractor for allowable, allocable and reasonable costs incurred in the performance of the contract. These include: (a) cost, (b) cost sharing, (c) cost-plus-fixed-fee, (d) cost-plus-incentive-fee, and (e) cost-plus-award-fee. These contracts are primarily used when it is not feasible to reasonably estimate the cost of performance, as in initial production and in research and development.
Special Purpose Contracts and Agreements which are used when fixed-price or cost reimbursement is inappropriate. These include: (a) basic agreements, (b) indefinite delivery contracts (e.g., definite quantity contracts, indefinite quantity contracts, or requirements contracts), (c) letter contracts, (d) time and materials contracts, and (e) labor hour contracts.
In addition to the pricing arrangement as reflected by the type of contract selected, contract terms and provisions set forth the obligations and responsibilities of the contractor and the Government. They consist of: (a) mandatory provisions or clauses common to all contracts, as well as those applicable to a particular contract type; and (b) optional clauses prescribed by regulation or developed by the contract specialist or procuring activity. The most common categories of clauses concern: (1) Warranty, Standards of Work, Default, Excusable Delays, and Inspection which are designed to ensure satisfactory performance or establish the contractor's liability; (2) rights in data for patents, royalties, and copyrights; (3) labor provisions, e.g., nondiscrimination, overtime, working conditions, and others; (4) business administration of the contract, i.e., changes, subcontracts, reporting requirements, and others; (5) provisions concerning payments to the contractor, bonds, taxes, and insurance; and (6) miscellaneous clauses on such subjects as ethics, foreign purchases, security, and audit by GAO.
4. BUSINESS EVALUATION
Before a contract is awarded, technical and business evaluations are conducted. The program office is responsible for the technical evaluations. The contracting office is responsible for the business evaluations, including but not limited to: (a) the responsiveness of the bid or offer to the solicitation, (b) evaluating the cost or price proposals, and (c) determining the responsibility of the contractor in terms of business operations and qualifications to perform the work. The scope of the business review is generally conditioned by the nature and complexity of the procurement, the method of procurement and type of contract anticipated, and the prospective contractor's experience and history of past performance. Information or assistance in conducting the review is normally obtained from technical specialists, accountants or auditors, or others, as appropriate. After the technical and business evaluations are completed, the final responsibility for the selection of the contractor resides with the contracting officer.
A. Responsiveness of Bids
In determining bid responsiveness, the contracting officer must first determine that each bid meets all material requirements established by the formal advertising solicitation document (e.g., required quantities, delivery schedule, mandatory contract terms and provisions, and others). Bids that fail to conform to the essential requirements are rejected as nonresponsive. Under the negotiated method, contractual terms and provisions, including the type of contract, schedule, and quantities are subject to negotiation, so nonresponsiveness does not initially disqualify an offeror.
B. Cost and Price Analysis
An objective of the Government is to acquire necessary supplies and services from responsible sources at fair and reasonable prices. Thus, some form of cost or price analysis is required for all contracting actions, especially for initial offers or bids, contract changes, and final settlements.
Price analysis is the process of examining and evaluating a prospective price without considering separate cost elements or profit. Price analysis is accomplished in various ways, including: (1) comparison of the price quotations submitted; (2) comparison of prior quotations and contract prices with current quotations for the same or similar end items; (3) use of parametric relationship measurements; (4) comparison of prices set forth in published price lists issued on a competitive basis, or published market prices of commodities; (5) comparison of proposed prices with estimates of cost independently developed by the Government.
Cost analysis involves the detailed examination of the cost estimates submitted by offerors to determine the necessity and reasonableness of costs. Cost analysis is generally required when: (1) established by regulation; (2) adequate competition does not exist, as in sole source negotiations; (3) the selection resulting from competitive negotiations is based primarily on technical factors; (4) a negotiated situation is expected to exceed a certain dollar threshold; (5) the procurement involves major systems involving design-to-cost considerations, i.e., practical trade-offs between system capability, cost, and schedule; and (6) the circumstances surrounding the procurement justify its time and expense. The most common cost elements include: (1) direct material cost, both quantity and unit price; (2) direct labor costs, including amount and rates; (3) nonrecurring costs, such as special tooling, test equipment, travel, and personnel training; (4) indirect costs, such as overhead and general and administrative expenses; and (5) profit or fee. The Government may, as part of its analysis, develop its own figures for each cost element. This is then used with other data as a basis for establishing the Government's prenegotiation goal on costs, profit or fee, or total price.
C. Bidder Responsibility
In determining responsibility, the contracting officer may have access to records of previous contracts. If sufficient data are not available to determine contractor responsibility, or needs verifying or updating, a preaward survey is performed by a contract specialist or is requested of and conducted by a contract administration office. The preaward survey involves an onsite inspection of a contractor's facilities, and includes a detailed evaluation of all the business aspects of the company's operations, financial status, and probability of successful performance.
The business review or preaward survey concentrates on such factors as: (1) financial resources; (2) existing business commitments, or backlog; (3) record of performance and integrity; (4) equal opportunity requirements; (5) possession of necessary skills, experience, management controls, equipment, and facilities; and (6) evaluation of the contractor's make-or-buy program, i.e., the specific work which will be performed in house by the contractor and that which will be obtained from subcontractors or suppliers.
The results of the business review or preaward survey generally affect the source selection process and may affect the structuring or awarding of the contract, e.g., the identification of a need to provide financial assistance to the contractor through the inclusion of provisions for progress payments, guaranteed loans, or advance payments.
5. CONTRACT ADMINISTRATION
Award of a contract signifies for both parties the point at which agreement has been reached and performance begins, and marks the beginning of the contract administration phase of the procurement cycle -- a phase that consists of all the actions that the Government must take with respect to the contractor until the material or service has been delivered, accepted and paid for, and the contract withdrawn, closed out, or terminated.
While the contractor has primary responsibility for the timely and satisfactory performance of a contract, the Government monitors outstanding contracts to ensure satisfactory progress, to assure compliance with the terms and conditions of the contract, and to identify problems that threaten performance. Technical assistance may be obtained by the cognizant contracting officer from engineering, field inspection, auditing, legal, and other personnel as necessary to administer the contract effectively and to protect the rights and best interests of the Government.
Typical contract administration functions are to:
Conduct postaward conferences; Assure timely submission of required reports; Determine allowability of costs and approve or disapprove contractor's request for payments; Review contractor's management system, compensation structure, insurance plans, and purchasing system; Review, analyze proposed subcontracts and consent, or withhold consent, to the placement of subcontracts; Perform cost or price analysis on proposals that involve contract changes, indirect rate agreements, and settlements; Negotiate contract modifications, terms and costs of changes, forward pricing proposals, provisioning orders, unpriced orders, final overhead rates, and settlements; Recommend acceptance or rejection of waivers and/or deviations; Monitor contractor's financial condition, compliance with labor and industrial relations matters, use of Government property, and small and minority business mandatory subcontracting programs; Determine contractor compliance with Cost Accounting Standards and Disclosure Statements, if applicable; Issue cure or show cause notices to correct severe performance deficiencies; Analyze claims and negotiate final settlements; Prepare findings of fact and issue decisions under the Disputes clause; Close out contracts, assuring delivery of the contract end items and inclusion of final reports and clearances.
6. CONTRACT TERMINATION
Contract termination by the Government occurs for a variety of reasons, such as technological advances in the state-of-the-art, changes in strategic planning, budget and funding limitations, or failure of the contractor to perform. Government contracts provide for termination prior to completion of the contract for either: (a) convenience of the Government, or (b) default of the contractor. Terminations may be either partial or complete, and may occur at any time during performance, even though the contractor is performing properly.
Whenever a contract is terminated for convenience, the contractor is usually entitled to the costs incurred under the terminated portion of the contract and to a profit or fee. Technical personnel may be called upon for information and assistance in connection with the negotiation of termination settlements. When the contractor fails to perform properly, the Government may terminate for default.
The contracting officer responsible for the contract termination typically:
Prepares show cause and cure letters; Reviews the contract, including provisions and modifications; Analyzes contractor and subcontractor settlement proposals from the standpoint of allowability, allocability, and reasonableness; Conducts conferences with the contractor to discuss the termination; Coordinates clearance of termination inventory; Recommends approval or disapproval of contractor partial payment requests; Develops a prenegotiation settlement position; Negotiates the settlement with the contractor including equitable adjustments, change proposals, costs, profit, and other related matters; Issues final decision determinations when appropriate; Evaluates default claims; Presents findings, as required, in hearings before the Board of Contract Appeals and the Courts.
The contract specialist performs developmental and/or recurring assignments in support of a local installation or in a centralized procurement activity. The specialist procures supplies or services primarily through formal advertising, or through limited use of negotiation techniques. Negotiated transactions are usually developmental assignments designed to increase the employee's skill and knowledge. Requirements involve standardized specifications and established markets. Typical examples include such technical items as special machine parts or special purpose equipment, or such services as repair, rental, educational, and maintenance of machines and equipment.
Reviews requisitions to determine that proper specifications or purchase descriptions are included in solicitation documents. Selects clauses to cover special conditions, such as inspection and acceptance, marking and packaging, quantity variation, price differential, or transportation costs. Contacts technical personnel to resolve questions of applicability of specifications, classifications of terms, or acceptance of substitute items.
Evaluates bids or proposals for compliance with specifications or purchase descriptions and applicable clauses. Considers financial responsibility of suppliers by evaluating contract performance on previous contracts. Meets with commercial representatives to discuss procurement needs, quality of items or services, current market prices, or delivery schedules.
Performs other assignments of similar difficulty that have been selected with a view to developing advanced skills, e.g., administering the negotiated and formally advertised contracts assigned; monitoring progress of contractors; preparing change orders; participating with higher graded specialists in the procurement of technical items using the formal advertised method where the items are manufactured to special specifications and are complicated by restricted price bidding, special processing, or packing and packaging specifications.
Coordinates contracting activities with other Government agencies having interrelated requirements, e.g., obtaining wage rate information from the Department of Labor, requesting audit reports or preaward surveys from Defense Contract Audit Agency or Defense Contract Administration Services, obtaining clearances from the Small Business Administration, and advertising work to be contracted in the Commerce Business Daily of the Department of Commerce.
Serves as contract specialist responsible for all aspects of the contracting transactions from initiation to recommendation of award for the: (1) central procurement of commodities or services for several activities in a geographic area, or for an agency, a department or departments; or (2) procurement of a variety of supplies, services, or construction in support of an installation or activity. Centralized requirements typically include specialized items, e.g., repair parts such as various hose assemblies and refueling hoses for aircraft and ships, components of specialized equipment, items which are manufactured to specification for a special purpose, or medical supplies and equipment. Installation support includes a variety of materials, services, or construction, e.g., valves, electrical and electronic equipment, protective clothing, mill and lumber products, minor alteration and repair, and maintenance, custodial, protective, and technical services involving the use of the formal contracting process.
Reviews requisitions and determines appropriate method of procurement, i.e., formal advertising or negotiation. This includes citing the authority in determinations and findings reports prepared for the contracting officer when procurement is by negotiation.
Develops procurement plans by reviewing previous history, market conditions, and specifications or technical data packages. Determines adequacy and completeness of description, which involves research of various manuals and catalogs, or discussions with manufacturer's representatives or requisitioning sources to identify and initiate any corrective actions required.
Compiles bidders' list from qualified bidders' applications, knowledge of suppliers, contacts with trade associations, Small Business Administration, or other sources.
Prepares and issues solicitation documents. Selects appropriate clauses, ensures clear and complete specifications including packing and delivery requirements or other stipulations, and serves as a central point of contact on assigned procurements to respond to inquiries.
Performs detailed analysis of bids or proposals received. This includes insuring strict compliance with specifications on advertised procurements, and recommending award to lowest bidder providing such compliance. On negotiated procurements, contacts offerors or contractors to negotiate prices which appear either excessive or underestimated, to request earlier delivery date or closer conformance to specifications, or similar matters.
In both formal advertised and negotiated acquisitions, performs detailed analyses to determine bid responsiveness and responsibility of offeror. This includes review of past bids and awards, request of preaward survey, and establishment of price reasonableness by either price or limited cost analyses.
Drafts final contract including specifications, packing and shipping requirements, inspection instruction, and all other special and standard clauses. Prepares recommendations for award, documenting reasons for decisions including justifying basis for not recommending lowest bidder.
Administers a variety of fixed-price service, supply, or construction contracts which contain terms and conditions such as progress payments, quantity options, Government-furnished property, or similar provisions; and/or administers specific phases of complex contracts, such as cost contracts with incentives, for which a higher level employee has overall responsibility.
Conducts conferences with contractors to clarify issues on contractual requirements, such as billing procedures, material submittals, and socioeconomic clauses.
Monitors contractor performance through telephone conversations, correspondence, and visits for compliance with applicable laws, delivery schedules, payment provisions, inspections, and other requirements as stated in the contract. Provides guidance to contractor concerning obligations to perform within contractual terms.
Reviews, analyzes, and recommends action on problem situations relating to incomplete specifications, deficient Government-furnished property, material shortages, and terminations for convenience.
Negotiates extensions of delivery schedules, price adjustments, labor hours, modifications to the contract, and similar agreements when precedents are well established and the contractor's and Government's bargaining positions are close. Prepares determinations and findings of fact relative to negotiations and pricing actions. Coordinates contractor's requests for deviations with buying or requiring activities, and makes recommendations.
Recommends issuing cure or show-cause notices when the contractor is not in compliance with contract provisions. Investigates circumstances to determine alternative courses of action, such as extension of delivery schedule for consideration flowing to the Government.
Prepares termination files for use in contract termination actions, including amounts paid, audit reports, product rejections, and other related documentation. Reviews termination inventories.
Reviews completed official contract file to determine that all contractual actions are satisfied, that there are no pending administrative actions to be resolved, that all file documents are signed, that there are no litigation actions pending, and that the contract is complete in every respect and ready to be closed.
Serves as contract specialist responsible for preaward and/or postaward functions for a variety of supply, service, and/or construction contracts for several activities within an organizational component or in a geographical area. The employee is responsible for a variety of contracts which frequently require special handling provisions or other specialized terms and conditions. Some contracts cover a period of more than one year. Typical requirements include technical equipment, supplies, construction, and services ranging from standard items which are complicated by urgent delivery requirements or security classification to complex or sophisticated requirements. Examples include equipment or services needed to support a research and development activity; ADP equipment, software and related services; conversion of installation functions from in-house to contract operations; negotiated contracts with disadvantaged business firms; contracts for surgeons and other specialized services and equipment for a hospital; construction projects related to new buildings, roads, bridges, highway sections, tunnels, airports, docks, and others which consist of standard design and specifications; negotiation of contract modifications and change orders caused by inadequate existing drawings, defective specifications, or changed site conditions; alteration and repair projects such as those requiring the demolition and removal of existing walls and windows, relocation of heating and air conditioning systems, and modification of primary lighting and communication channels; contracts for design and/or engineering services, other technical services, and technical equipment and supplies; or contracts for acquisition and installation of building equipment systems.
Provides guidance to technical personnel involved in the development of the statement of work or data requirements. Formulates the contracting approach to be taken that will best satisfy the requirement. In formally advertised procurements, insures that the bid schedule is properly structured, prepares the solicitation, determines sources to be solicited, conducts prebid conferences, processes protests, determines the responsiveness of bids and determines the responsibility of the apparent low bidder based on an analysis of financial and technical information gained during the preaward survey, and awards or recommends award of the contract. In negotiated procurements, the employee plans the procurement action with technical, legal, and contract pricing personnel. Provides guidance in the development of the statement of work and data requirements, determines the type of contract best suited to the requirement, develops special clauses and terms and conditions applicable to the solicitation. Determines the sources to be solicited, prepares applicable determinations and findings, conducts preproposal conferences, receives and evaluates proposals in conjunction with price/cost analysts or other technical personnel, determines the competitive range in negotiations with one or more offerors, prepares award documents and makes presentation to a contract board of awards or source selection authority when appropriate. Responds to inquiries, including formal protests and congressional inquiries.
Serves as contract administrator assigned to a contract administration team. The team chief, a warranted contracting officer, assigns a group of contractors for which the employee performs the full range of contract administration functions to the point of signature, including negotiation of delivery orders, spare parts and provisioning orders, orders against basic ordering agreements, and indefinite quantity contracts. Contracts are for the design, development, and manufacture of a variety of products and services, ranging from microelectronics to air conditioning equipment.
Performs contract administration functions, handling a variety of actions and problems relating to assigned contracts. Maintains funds status by various management accounts to insure that over- obligation does not occur on orders. Analyzes contract fund status reports, reviews actual expenditures made by contractor, reviews reports made by technical specialists, determines if the contractor's progress and expenditures compare with negotiated estimates, and prepares appropriate correspondence and recommendations to the contracting officer. Coordinates with the contracting officer to obtain additional funds or to deobligate funds when the contractor's performance varies significantly from the original estimate.
Coordinates with the buying office on contractor's requests for waivers or deviations from contract terms. Resolves delivery schedule problems with contractor and buying activity, and negotiates delivery schedule changes. Reviews, investigates, and recommends actions on overtime requests, allowability of costs, and problems concerning Government property. Reviews progress payment requests to assure that required clauses in the contract are met, that proper rates are being applied, and that proper accounting is made. Maintains records and registers on the status of various contract administration actions or requirements.
Advises contractor as to scope of work statements, shipping requirements, EEO requirements for clearances of subcontractors, and other questions regarding the meaning of terms and conditions. Evaluates contractor compliance with applicable contract clauses, e.g., small business, patent rights, labor laws, and progress reports.
Requests determination of overhead rates from auditor for cost contracts and assures delivery, inspection, and acceptance of the contractual end items before recommending final closeout of the contract. Assures deobligation of excess funds, and that special test equipment, tooling, and Government-furnished property is properly accounted for. Negotiates with contractors for consideration when delinquencies occur. Uses the reports, advice, and assistance from the legal office, price/cost analysts, quality and production specialists, and property administrators in making determinations and recommendations.
Receives requests from procuring activities for specific services and/or products specified under basic ordering agreements, or by provisioning and spare parts clauses of contracts. Reviews requests and meets with the contractor to assure understanding of the requirements. Issues an unpriced order for the item or service to enable the contractor to begin work. Receives subsequent formal proposals prepared by the contractor, and determines the extent of price or cost analysis and technical analysis required. Reviews elements of proposals using previous experience with similar items, contractor's actual expenditures, and established rates as guides.
Forwards larger proposals to technical specialists (auditors, price/ cost analysts, or engineers) for in-depth review. Establishes a fair and reasonable negotiation position based on a knowledge of the contractor's operations and the reports of the technical specialists. Establishes fee or profit to be allowed based on guidelines established in the basic agreement or contract, and by regulation. Negotiates directly with the contractor regarding final settlement and prepares supplemental agreement for the contracting officer's signature. Prepares negotiation memoranda to explain rationale and methods used in arriving at the final settlement and prepares full documentation for cases requiring formal review.
Serves as one of several contract specialists responsible for preaward and postaward functions, including price/cost analysis, negotiation, and administration for services, materials, and equipment associated with research, development, test, evaluation, and/or production activities of one or more organizations. Requirements typically involve such equipment, services, and/or construction as the following:
(1) Equipment-highly specialized scientific instruments and laboratory testing devices, such as electro/mechanical testing equipment; or newly developed items, major components, or items which require special testing, approval, tooling, and Government-furnished property; or automatic data processing systems; or similar equipment of special design to required specifications not available as standard off-the-shelf items; and/or,
(2) Services-professional or technical services, such as scientific studies involving waste and transportation systems; or broadly based land and resources inventories; or evaluation of industrial and chemical processes and emission sources, and state-of-the-art control technology for various emissions and effluents; or oil shale, coal and gas resources and impact statements on wildlife and forestry uses, or air and water pollution; or architect and engineering services in support of research and development projects, large buildings, or other complex projects; or design services for modifying specialized equipment, e.g. aircraft or communications systems; or basic or applied research projects, such as large-scale clinical trials or drug development programs; and/or,
(3) Construction-facilities for the production of weapons systems or subsystems; or a research laboratory where a substantial amount of special and collateral equipment is to be procured and installed; or special purpose buildings and test structures.
Reviews requests for the procurement of complex equipment, services, and/or construction. Analyzes the requirement, recommends revisions to the statement of work or specifications as necessary, and decides on the type of contract, milestones, and procurement plan. Reviews justifications for sole source and other required clearances, and prepares documentation.
Prepares solicitation documents. Incorporates provisions, such as cost accounting standards, requirements for technical proposals with appropriate weighing factors, testing procedures, cost escalation factors, cost data requirements, and socioeconomic programs. Solicits proposals from prospective contractors.
Analyzes proposals for conformance with the solicitation. Performs cost or price analysis, including review of cost breakdowns to determine reasonableness. Coordinates the establishment of a technical evaluation committee to determine acceptability of technical proposals. Obtains required preaward surveys to establish contractor responsibility, and obtains audits and pricing reports to develop negotiation strategy.
Negotiates with potential contractors. Awards contracts within delegated contracting officer authority, or recommends award to contracting officer on contracts outside delegated authority.
Assists contract administration offices in the administration of contracts, including performance of termination actions, until final delivery and payments are completed and the contract is closed and retired; or personally monitors contractor's performance through telephone conversations, correspondence, reports, vouchers, and visits for status of contract performance, scheduling, problems that have arisen and proposed solutions, verification of deliveries, and similar activities. Interprets contract provisions for contractors and for officials of the agency, and provides appropriate advice and guidance. Negotiates contract modifications.
Prepares initial agency position on protests from unsuccessful bidders and renders or recommends a decision on claims arising under the contract.
Closes out the contract, or issues termination notices and reviews settlement proposals.
Serves as contract specialist responsible for preaward and postaward functions involving highly specialized procurements of significant importance to the agency. Requirements typically involve systems or programs such as:
(1) Research, development, and production of extensive, specialized equipment or systems. Examples include state-of-the-art electronic guidance and control systems, radar systems, switching or transmission equipment for a nationwide communications network, technologically advanced gun mounts or missile launchers, ground reconnaissance vehicles, aeronautical equipment, a telemetry system for a new spacecraft, or extensive ADP systems such as systems software for nationwide teleprocessing networks. Or,
(2) Research and development on long-term social, economic, environmental, or health problems for which there is little meaningful experience or precedent data available. Examples include a multiphased minerals and mineral-related studies program involving basic data collection, research and development, and experimental research; a major, multiple year research program involving basic research, production of highly specialized chemical compounds, scientific instrumentation, and equipment for which there is no experience or firm specifications available; or demonstration projects involving feasibility or validity studies, design, and prototype or model fabrication for urban mass transportation systems.
Performs procurement planning. Identifies within assigned major program(s) those large-scale subsystems, components, equipment, and services to be acquired by contract. Develops procurement objectives for the program in terms of competition and price range, and constructs the contractual vehicle including use of pricing arrangements, subcontracting policy, bet-aside policies, and similar considerations. Prepares and maintains current acquisition plans, appropriate milestone charts, and related schedules.
Serves as advisor to program officials in procurement planning meetings. Advises program officials of the procurement objectives to be used, and assists in the preparation of statements of work. Prepares determinations and findings and solicitation documents. Performs detailed analyses of all elements of cost in contractor proposals, and makes competitive range determinations. Conducts preproposal conference(s) with prospective contractor(s) to arrive at a clear understanding of what is required under the proposed contract. Obtains appropriate data from business and technical officials. Issues necessary modifications to clarify questions concerning such topics as specification changes, language ambiguities, or clarification of contract clauses. As required by the lack of meaningful cost and price information, explores new or innovative contracting approaches to arrive at an equitable contract arrangement.
Serves as lead negotiator. Plans the negotiation strategy, coordinates strategy with negotiation team, and leads the negotiations which are conducted with contractors to develop the contract prices and terms. Awards the contract.
Performs contract administration. Responsibilities typically include incremental funding, preparation of rate and cost adjustments, redirection of effort, coordination of time extension, incorporation of change orders, issuance of stop work orders, issuance of cure notices or show cause letters, monitoring of Government property reporting, approval of progress payments, final payment, and contract closeout.
Terminates contracts for the convenience of the Government or default by the contractor.
Training, Other Qualifications, and Advancement
Workers may begin as trainees, purchasing clerks, junior buyers, or assistant buyers. Most employers prefer to hire applicants who have a college degree and who are familiar with the merchandise they sell and with wholesaling and retailing practices. Prospects often need continuing education or certification to advance.
Education and training. Educational requirements tend to vary with the size of the organization. Large stores and distributors prefer applicants who have completed a bachelor's degree program with a business emphasis. Many manufacturing firms put an even greater emphasis on formal training, preferring applicants with a bachelor's or master's degree in engineering, business, economics, or one of the applied sciences. A master's degree is essential for advancement to many top-level purchasing manager jobs.
Regardless of academic preparation, new employees must learn the specifics of their employer's business. Training periods vary in length, with most lasting 1 to 5 years. In manufacturing, new employees work with experienced purchasers to learn about commodities, prices, suppliers, and markets. In addition, they may be assigned to the production planning department to learn about the material requirements system and the inventory system the company uses to keep production and replenishment functions working smoothly.
In wholesale and retail establishments, most trainees begin by selling merchandise, checking invoices on material received, and keeping track of stock. As they progress, trainees are given increased buying-related responsibilities.
Other qualifications. Purchasing managers, buyers, and purchasing agents must know how to use various software packages and the Internet. Other important qualities include the ability to analyze technical data in suppliers' proposals; good communication, negotiation, and mathematical skills; knowledge of supply-chain management; and the ability to perform financial analyses.
People who wish to become wholesale or retail buyers should be good at planning and decision making. They also should have an interest in merchandising. In addition, marketing skills and the ability to identify products that will sell are very important. Employers often look for leadership ability, too, because buyers spend a large portion of their time supervising assistant buyers and dealing with manufacturers' representatives and store executives.
Certification and advancement. An experienced purchasing agent or buyer may become an assistant purchasing manager before advancing to purchasing manager, supply manager, or director of materials management. At the top levels, duties may overlap with other management functions, such as production, planning, logistics, and marketing.
Regardless of industry, continuing education is essential for advancement. Many purchasing managers, buyers, and purchasing agents participate in seminars offered by professional societies and take college courses in supply management. Professional certification is becoming increasingly important, especially for those just entering the occupation.
There are several recognized credentials for purchasing agents and purchasing managers. The Certified Purchasing Manager (C.P.M.) designation was conferred by the Institute for Supply Management. In 2008, this certification was replaced by the Certified Professional in Supply Management (CPSM) credential, covering the wider scope of duties now performed by purchasing professionals. The Certified Purchasing Professional (CPP) and Certified Professional Purchasing Manager (CPPM) designations are conferred by the American Purchasing Society. The Certified Supply Chain Professional (CSCP) credential is conferred by APICS, the Association for Operations Management. For workers in Federal, State, and local government, the National Institute of Governmental Purchasing offers the designations of Certified Professional Public Buyer (CPPB) and Certified Public Purchasing Officer (CPPO). These certifications are awarded only after work-related experience and education requirements are met and written or oral exams are successfully completed.
Purchasing managers, buyers, and purchasing agents held about 527,400 jobs in 2008. About 42 percent worked in the wholesale trade and manufacturing industries and another 10 percent worked in retail trade. The remainder worked mostly in service establishments, such as management of companies and enterprises or professional, scientific, and technical services. A small number were self-employed.
The following tabulation shows the distribution of employment by occupational specialty:
|Purchasing agents, except wholesale, retail, and farm products||295,200|
|Wholesale and retail buyers, except farm products||147,700|
|Purchasing agents and buyers, farm products||14,100|
Employment of purchasing managers, buyers, and purchasing agents is expected to increase 7 percent through the year 2018. Job growth and opportunities, however, will differ among different occupations in this category.
Employment change. Overall employment of purchasing managers, buyers, and purchasing agents is expected to increase 7 percent during the 2008-18 decade, which is as fast as the average for all occupations. Employment of purchasing agents, except wholesale, retail, and farm products—the largest employment group in the industry—will experience faster than average growth as more companies demand a greater number of purchased goods and services. Additionally, large companies are increasing the size of their purchasing departments to accommodate purchasing services contracts from smaller companies. Also, many purchasing agents are now charged with procuring services that traditionally had been done in-house, such as computer and IT (information technology) support in addition to traditionally contracted services such as advertising. Nonetheless, demand for workers may be somewhat limited by technological improvements such as software that has eliminated much of the paperwork involved in ordering and procuring supplies, and the growing number of purchases being made electronically through the Internet and electronic data interchange (EDI). Demand will also be limited by offshoring of routine purchasing actions to other countries.
Employment of purchasing managers is expected to have little or no change. The use of the Internet to conduct electronic commerce has made information easier to obtain, thus increasing the productivity of purchasing managers. The Internet also allows both large and small companies to bid on contracts. Exclusive supply contracts and long-term contracting have allowed companies to negotiate with fewer suppliers less frequently. Still, purchasing managers will be needed to oversee large consolidated purchasing networks, thus spurring some employment growth.
Employment of purchasing agents and buyers of farm products is also projected to have little or no change, as overall growth in agricultural industries and retailers in the grocery-related industries consolidate. Furthermore, automation, offshoring, and the outsourcing of more services are expected to further impede employment growth.
Finally, little or no change in employment of wholesale and retail buyers, except farm products, is expected. In the retail industry, mergers and acquisitions have caused buying departments to consolidate. In addition, larger retail stores are eliminating local buying departments and creating a centralized buying department at their headquarters.
Job prospects. Persons who have a bachelor's degree in engineering, business, economics, or one of the applied sciences should have the best chance of obtaining a buyer position. Industry experience and knowledge of a technical field will be an advantage for those interested in working for a manufacturing or industrial company. Government agencies and larger companies usually require a master's degree in business or public administration for top-level purchasing positions. Most managers need experience in their respective field.
Further information about education, training, employment, and certification for purchasing careers is available from:
- American Purchasing Society, P.O. Box 256, Aurora, IL 60506.
- APICS The Association for Operations Management, 8430 West Bryn Mawr Avenue, Suite 1000, Chicago, IL 60631. Internet: http://www.apics.org
- Institute for Supply Management, P.O. Box 22160, Tempe, AZ 85285-2160. Internet: http://www.ism.ws
- National Institute of Governmental Purchasing, Inc., 151 Spring St., Suite 300, Herndon, VA 20170-5223. Internet: http://www.nigp.org
Information on obtaining Contract Specialist positions with the Federal Government is available from the Office of Personnel Management through USAJOBS, the Federal Government's official employment information system. This resource for locating and applying for job opportunities can be accessed through the Internet at http://www.usajobs.gov or through an interactive voice response telephone system at (703) 724–1850 or (703) 724–1850 or TDD (978) 461–8404 and (978) 461–8404. These numbers are not toll free, and charges may result. For advice on how to find and apply for Federal jobs, download the Insider's Guide to the Federal Hiring Process” online here.
Source: OPM's Position Classification Standards for White Collar Work