7.202 Policy
Source: FAR 7.202 on acquisition.gov
Agencies must buy supplies in quantities that are cost-effective and reasonable, and solicitations should invite offerors to suggest more economical quantities when practicable.
Overview
FAR 7.202 establishes the policy for agencies to procure supplies in quantities that are economically advantageous to the Government, while not exceeding the agency's reasonable requirements. The regulation is grounded in statutory requirements (10 U.S.C. 3242 and 41 U.S.C. 3310) and aims to ensure cost-effective purchasing practices. It also requires solicitations for supply contracts, when practicable, to invite offerors to provide input on the economic advantage of proposed quantities and to suggest alternative quantities that may yield better pricing for the Government.
Key Rules
- Economic Quantity Determination
- Agencies must procure supplies in quantities that result in the lowest total and unit costs, where practicable, but not more than what is reasonably needed.
- Solicitation Requirements
- Solicitations for supply contracts should, if practicable, ask offerors to comment on the economic advantage of the proposed quantity and recommend alternative quantities with corresponding pricing if applicable.
Responsibilities
- Contracting Officers: Must ensure solicitations include the required provision for offeror input on quantities, and that purchases are made in economically advantageous quantities.
- Contractors: Should provide opinions and recommendations on supply quantities and pricing when responding to solicitations.
- Agencies: Must oversee compliance with statutory and FAR requirements for economic purchasing and solicitation content.
Practical Implications
- This policy ensures agencies avoid overbuying or underbuying, optimizing costs and inventory management.
- Contractors have an opportunity to influence procurement quantities, potentially improving their competitiveness and the Government's cost savings.
- Common pitfalls include failing to include the required solicitation provision or not adequately justifying quantity determinations.
(a) Agencies are required by https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title10-section3242&num=0&edition=prelim" target="_blank">10 U.S.C. 3242 and http://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title41-section3310&num=0&edition=prelim" target="_blank">41 U.S.C.3310 to procure supplies in such quantity as-
(1) Will result in the total cost and unit cost most advantageous to the Government, where practicable; and
(2) Does not exceed the quantity reasonably expected to be required by the agency.
(b) Each solicitation for a contract for supplies is required, if practicable, to include a provision inviting each offeror responding to the solicitation-
(1) To state an opinion on whether the quantity of the supplies proposed to be acquired is economically advantageous to the Government; and
(2) If applicable, to recommend a quantity or quantities which would be more economically advantageous to the Government. Each such recommendation is required to include a quotation of the total price and the unit price for supplies procured in each recommended quantity.