Definition of a Blanket Purchase Agreement

Blank purchase agreements (BPAs) are used by government agencies and organizations. The agreements are used to allow approved agencies to order and pay for supplies and services that they purchase from approved vendors several times a year. The agreements simplify the government purchasing process. Having a BPA is similar to having a charge card.

Who Can Create an Agreement

Each purchasing agency is reviewed separately before it is approved to open a BPA account. BPAs are only approved for a limited number of government agencies. The number of BPAs that an agency can receive is determined by the amount of purchases an agency anticipates making in a financial year. Purchasing limits are set at $100,000. General Service Administration (GSA) offices can also create GSA Schedule BPAs. These particular agreements are only approved for GSA offices and have no purchasing limit. Military branches order and receive supplies from approved vendors through BPA accounts.

Schedule contractors can also create a BPA with the government to sell products and services to approved purchasing agencies. Approved contractors must adhere to Multiple Award Schedules and Federal Supply Schedules. Before a vendor can become a schedule contractor they must respond to a GSA Schedule solicitation provided by the GSA. Vendors must also complete the Center for Acquisition Excellence online training course. The self-paced training program covers the offer submission process, marketing products and services and information on administering schedule contracts with the government. Vendors who provide products and services at greater discounts can increase their chances of gaining government approval to supply products and services to approved BPA account holders.

Duration

A GSA schedule BPA typically lasts for five years. If an annual review of the purchasing agency's ordering habits shows that the agency has a low order-placement frequency, the BPA might be confined to a five-year term. Otherwise, approved schedule contractor vendors can have their BPAs approved beyond five years.

Documentation

Before schedule purchasing agencies and GSA offices can have a BPA approved, they must provide the names of the vendors with whom they anticipate conducting business and ordering supplies and services from as well as the amounts and types of purchases that they will make with the vendors throughout the duration of the BPA. Agencies also have to explain why they only do business with a limited number of vendors if the number is less than what is required for the specific BPA schedule ordering guideline. Prior to submitting a request for a BPA, agencies must also identify how they evaluated the vendors that they decided to conduct business with using the BPA account. Prices for products and services ordered through the BPA account must adhere to federal acquisition regulations.

BPA Format

The BPA form is generally one page in length. Key items required on the form include the types and services ordered and the vendor's delivery methods as well as the anticipated delivery date for services or products that were ordered. In addition, the form must contain the date that the BPA expires, the names of agency contacts who are familiar with the BPA, the name of the vendor or contractor that the purchase was made with and the item model and product numbers.

Benefits

BPAs save time, account review and money needed for government agencies to place recurring orders. The volume of agencies that purchase products and services from approved vendors allows the agencies to negotiate lower price agreements with the vendors or approved companies that they conduct business with. Furthermore, BPAs streamline the ordering process, lower costs by providing bulk discount rates for products and services and allow for thorough purchasing documentation and annual account reviews.

Considerations

Important factors to consider before applying for a BPA are the costs of the purchases, administrative and processing costs, and qualifications of the respective agency and the vendors from whom the agency anticipates it will purchase products and services. Accurate and detailed record keeping is also required. Agencies that do not have the staff or skill to maintain organized records for all orders placed to the BPA account might not be best suited for the BPA.