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Contractor or Vendor

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Everywhere... sorry to sound so ambiguous, but I see the terms used interchangeably in SOWs, PWSs, RFQs, RFPs... everywhere.. Are they interchangeable?

I was originally taught (probably wrongly) that a "vendor" was like the soda machine company or a hot-dog vendor, where they are allowed to sell on government land but must pay a percentage (or fixed fee) to do so... and that a "contractor" was a company that via contract provided a product, service, or construction to the Government for a price.

Now as I'm getting a little older doing this stuff, I'd like to be sure of some of the terminology before I get too much farther...

I looked in Part 2 of the FAR, but didn't see either defined. Then I did a FAR Search on one of the FAR websites and both terms are used frequently.

Any clarification is appreciated.

:)

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Everywhere... sorry to sound so ambiguous, but I see the terms used interchangeably in SOWs, PWSs, RFQs, RFPs... everywhere.. Are they interchangeable?

I was originally taught (probably wrongly) that a "vendor" was like the soda machine company or a hot-dog vendor, where they are allowed to sell on government land but must pay a percentage (or fixed fee) to do so... and that a "contractor" was a company that via contract provided a product, service, or construction to the Government for a price.

Now as I'm getting a little older doing this stuff, I'd like to be sure of some of the terminology before I get too much farther...

I looked in Part 2 of the FAR, but didn't see either defined. Then I did a FAR Search on one of the FAR websites and both terms are used frequently.

Any clarification is appreciated.

:)

Personally, I view them as interchangeable. I've never heard a distinction like you describe. My experience is that Procurement folks more often refer to "vendor", where Contracts and Subcontracts people call them "contractor/subcontractor."

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Within the context of applying the rules of the FAR, there is generally no difference. However, the difference could be significant in a different context.

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The meaning, when used in a contract, depends on the intention of the parties. When used less formally it could mean almost anything connected with selling something to someone.

Merriam-Webster's Third New International Dictionary, Unabridged, defines vendor as follows: "one that offers goods for sale especially habitually or as a means of livelihood : SELLER: a (1) : an independent seller in a small way of business; especially : PEDDLER (2) : a person that hawks and sells merchandise (as refreshments, programs, or souvenirs) to patrons of a public gathering b : VENDING MACHINE.

The Government Contracts Reference Book, 3d ed., defines vendor as "A seller of goods," and says that in government contracting it usually refers to a person or organization who sells to contractors.

Black's Law Dictionary, 8th ed., defines vendor as "seller, usu. of real property."

FAR uses the word vendor in 33 places, in most cases using it as a synonym for subcontractor, as in the clause at 52.222-54, Employment Eligibility Verfication (Jan 2009), paragraph (a): "Subcontractor means any supplier, distributor, or firm that furnishes supplies or services to or for a prime Contractor or another subcontractor." However, it also uses the term to refer to a firm that sells to the government, as in FAR 8.501: "Federal helium supplier means a private helium vendor that has an in-kind crude helium sales contract with the Bureau of Land Management (BLM) and that is on the BLM Amarillo Field Office's Authorized List of Federal Helium Suppliers available via the Internet... . See also FAR 13.102(a): "Contracting officers should use the Central Contractor Registration database (see Subpart 4.11) at as their primary sources of vendor information" It sometimes uses the term in a way that seems to make a distinction, as in FAR 15.407-4(B)(3): "While the particular elements to be analyzed are a function of the contract work task, elements such as manufacturing, pricing and accounting, management and organization, and subcontract and vendor management are normally reviewed in a should-cost review."

All in all, I do not think that FAR makes a clear distinction between contractor, subcontractor, and vendor, but it seems to use it most often to refer to someone who sells to a prime contractor or a subcontractor.

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I personally think of "vendor" as a demeaning term. I like to use "offeror" in solicitation instructions and provisions (pre-award context) and "contractor" (post award contractor) when referring to the prime.

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For what it's worth, I have a Government Contracts Dictionary that was provided to me many years ago when I went to my first contracts training class. I use it quite often. It doesn't always give the source for its definitions, but in the forward it says it has been compiled from scattered elements of Federal, State and local government contracting regulations and literature. Here are the definitions it contains for Contractor and Vendor:

Contractor: (1) A supplier, vendor or manufacturer having a contract (commitment) to provide supplies or services to the Government. (2) Any individual or other legal entity that (a) directly or indirectly (e.g., through an affiliate), submits offers for or is awarded, or reasonably may be expected to submit offers for or be awarded, a Government contract, including a contract for carriage under Government or commercial bills of lading, or a subcontract under a Government contract or (B) conducts business, or reasonably may be expected to conduct business, with the Government as an agent or representative of another contractor.

Vendor: (1) Seller. Means a supplier of goods or one who operates in real estate; a supplier of a house, etc. (2) An individual, partnership, corporation or other activity which sells property to the military establishment. A vendor may supply a Government contractor. See Contractor.

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I also think it's interesting that, for those who deal with, or are in, DoD, the Defense Finance and Accounting Service (DFAS) has their Accounts Payable operation broken down into two parts - "Contract Pay" and "Vendor Pay." Here's their description:

"Contract Pay:

"The contract pay function within Accounts Payable operates solely out of DFAS Columbus, and includes paying contractors through formal, long-term contract instruments, requiring contract administration, that provide products and services to the DoD components (the military Services and defense agencies). Those contracts are typically administered by the Defense Contract Management Agency (DCMA) and tend to be complex, multi-year purchases with high dollar values, such as the purchase of major weapon systems. The contract pay function makes payments to more than 17,100 contractors on some 317,000-plus contracts.

"In addition to the operations functions of entitlement and payment, contract pay encompasses all the ancillary functions in support of operations, such as policy and procedures; contract reconciliation; electronic commerce initiatives; debt collection, reporting and analysis and customer service.

"Vendor Pay:

"The vendor pay function within Accounts Payable, as of February 2007, operates from 16 DFAS sites, two of them overseas (one in Germany, one in Japan). Nine stateside vendor pay locations will be closed by FY 2009, with that workload moved to the enduring DFAS sites in CONUS.

"Vendor pay includes entitlement determination and payment for day-to-day goods and services on contracts not administered by DCMA, plus miscellaneous non-contractual payments to businesses and individuals (e.g., utilities). Vendor pay uses 16 different systems to make payments in support of the Army, Navy, Air Force, Marine Corps and Defense Agencies. Some systems support only a single commodity type (e.g., fuels; subsistence; Commissary items), while others are used at multiple sites for a variety of goods and services."

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Interesting distinction Navy_Contracting!

New question: Since vendor pay locations are closing, will they continue to make a distinction between contract and vendor pay?

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I have a question along these lines. Contractor, Vendor, Offeror - these are often used interchangeably. But specifically, for Simplified Acquisitions, FAR 13.004 says that a quote is not an offer. Therefore, doesn't that mean that the company submitting a quote is not an offeror? In Simplified Acquisitions, the Government makes the offer and the Awardee/Contractor accepts by performing. Most of the time, Simplified Acquisition Procedures/RFQs (FAR 13) are used to obtain Commercial Items (FAR 12). So what ends up happening is that an RFQ is issued, it has the clauses required by FAR 12.301 (FAR 52.212-1 to FAR 52.212-5), and those clauses repeatedly refer to the contractors who may submit a quote as "Offerors." But they are not offerors, they are . . . well . . . what is the most appropriate term? Just say "contractors"? Or vendors"? They are certainly not offerors.

Has anybody else noticed this problem?

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I have a question along these lines. Contractor, Vendor, Offeror - these are often used interchangeably. But specifically, for Simplified Acquisitions, FAR 13.004 says that a quote is not an offer. Therefore, doesn't that mean that the company submitting a quote is not an offeror? In Simplified Acquisitions, the Government makes the offer and the Awardee/Contractor accepts by performing. Most of the time, Simplified Acquisition Procedures/RFQs (FAR 13) are used to obtain Commercial Items (FAR 12). So what ends up happening is that an RFQ is issued, it has the clauses required by FAR 12.301 (FAR 52.212-1 to FAR 52.212-5), and those clauses repeatedly refer to the contractors who may submit a quote as "Offerors." But they are not offerors, they are . . . well . . . what is the most appropriate term? Just say "contractors"? Or vendors"? They are certainly not offerors.

Has anybody else noticed this problem?

There may not be a big difference between a "contractor" and a "vendor" but there is a HUGE difference between an "offeror" and a "quoter". I use the word "quoter" when soliciting RFQs.

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FAR uses the word "quoters." For example, FAR 13.106-1(a)(2) states:

When soliciting quotations or offers, the contracting officer shall notify potential quoters or offerors of the basis on which award will be made (price alone or price and other factors, e.g., past performance and quality). Contracting officers are encouraged to use best value.

You can tailor FAR 52.212-1 to change "offerors" to "quoters" if you like.

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FAR uses the word "quoters." For example, FAR 13.106-1(a)(2) states:

When soliciting quotations or offers, the contracting officer shall notify potential quoters or offerors of the basis on which award will be made (price alone or price and other factors, e.g., past performance and quality). Contracting officers are encouraged to use best value.

You can tailor FAR 52.212-1 to change "offerors" to "quoters" if you like.

I've never seen a version of 52.212-1 that is tailored specifically for RFQs. It would require tailoring not only to the term "offer/offeror" but also tailoring of several references to FAR 15 requirements (i.e. debriefings, discussions, late submissions, SF1449 [potentially]). I fear that because tailoring must be by addendum to the clause, a tailored version might be hard to read.

-

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I also can't imagine why you would use FAR 52.212-1 for "quoters." It is intended for "offerors" who make offers and are, in fact, bound to hold open those offers for 30 days (FAR 52.212-1©), whereas a "quote" is not, by definition, a legally binding offer (see FAR 13.004). Thus, a "quoter" would be a "vendor" until the Government places an order and the supplier accepts it (see same FAR section). At that point, the vendor/quoter also becomes a "contractor." Hopefully, with an RFQ, you will not need to include all the instructions to offerors found in 52.212-1 because you are not going to have as extensive an evaluation scheme as envisioned in 52.212-2.

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K-Law Atty,

I don't understand the point you are trying to make. You don't think that FAR 52.212-1 should be incorporated in RFQs for commercial items?

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K-Law Atty,

I don't understand the point you are trying to make. You don't think that FAR 52.212-1 should be incorporated in RFQs for commercial items?

I'm saying 1) that I don't see why you would need it in a pure RFQ -- not an RFP -- and 2) that I can't recall ever seeing it done.

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I'm saying 1) that I don't see why you would need it in a pure RFQ -- not an RFP -- and 2) that I can't recall ever seeing it done.

K-Law Attorney

This goes back to the question of July 9 that govt2310 raised about the provision. FAR 13.501? says "When acquiring commercial items using the procedures in this part, the requirements of Part 12 apply subject to the order of precedence provided at 12.102?. This includes use of the provisions and clauses in Subpart 12.3." FAR 12.301 says to use 52.212-1 among other provisions.

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I'm saying 1) that I don't see why you would need it in a pure RFQ -- not an RFP -- and 2) that I can't recall ever seeing it done.

K-Law Atty,

You've never seen FAR 52.212-1 included in an RFQ? Can you provide your interpretation of FAR 12.301( B)?:

"(
B)
Insert the following provisions in solicitations for the acquisition of commercial items, and clauses in solicitations and contracts for the acquisition of commercial items:

(1) The provision at 52.212-1, Instructions to Offerors?Commercial Items. This provision provides a single, streamlined set of instructions to be used when soliciting offers for commercial items and is incorporated in the solicitation by reference (see Block 27a, SF 1449). The contracting officer may tailor these instructions or provide additional instructions tailored to the specific acquisition in accordance with 12.302."

Also, as an exercise I'd like to suggest you review the site: www.fbo.gov. There you can perform a search of open solicitations and review agency RFQs for commercial items. I just now performed such a search and found no RFQs that did not include 52.212-1.

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In defense of K-Law Atty, not that he/she needs my help, FAR 52.212-1 is entitled, Instructions to Offerors. Nowhere does it mention quote or quoter. The text of the provision is clearly inappropriate for use in RFQs. Moreover, FAR 12.301(B)(1) says that it is to be used when soliciting "offers." I cannot find the term "quote" or "quotation" anywhere in FAR Part 12.

Finally, the fact that you can find people using it in RFQs on FBO is evidence of exactly nothing, except that people do all sorts of inappropropriate and improper things on FBO.

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In defense of K-Law Atty, not that he/she needs my help, FAR 52.212-1 is entitled, Instructions to Offerors. Nowhere does it mention quote or quoter. The text of the provision is clearly inappropriate for use in RFQs. Moreover, FAR 12.301(B)(1) says that it is to be used when soliciting "offers." I cannot find the term "quote" or "quotation" anywhere in FAR Part 12.

Finally, the fact that you can find people using it in RFQs on FBO is evidence of exactly nothing, except that people do all sorts of inappropropriate and improper things on FBO.

Vern,

I initially agreed with K-Law Atty but I see this in FAR 13.5 - special test athority to use simplifed acquisition procedures for commercail items:

When acquiring commercial items using the procedures in this part, the requirements of Part 12 apply subject to the order of precedence provided at 12.102©. This includes use of the provisions and clauses in Subpart 12.3.

I see your point but it's really unclear whether the provision should be used or not.

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In defense of K-Law Atty, not that he/she needs my help, FAR 52.212-1 is entitled, Instructions to Offerors. Nowhere does it mention quote or quoter. The text of the provision is clearly inappropriate for use in RFQs. Moreover, FAR 12.301(B)(1) says that it is to be used when soliciting "offers." I cannot find the term "quote" or "quotation" anywhere in FAR Part 12.

The determining factor as to whether to include a clause or provision in a solicitation is the prescription. The prescription I cited at FAR 12.301(b ) says to include the provision "in solicitations for the acquisition of commercial items." The prescription does not draw a distinction as to whether your solicitation method is RFQ or RFP.

Additionally, FAR 12.102(b ) states: "Contracting officers shall use the policies in this part in conjunction with the policies and procedures for solicitation, evaluation and award prescribed in Part 13, Simplified Acquisition Procedures; Part 14, Sealed Bidding; or Part 15, Contracting by Negotiation, as appropriate for the particular acquisition." [underlining added]. So if you are performing an acquisition for commercial items, you are still using the acquisition procedures of Part 13, 14, or 15, in conjunction with the procedures of Part 12. For example, an open market acquisition for computer equipment < $100K would be solicited using the procedures of Part 12 + 13. FAR Part 13 mentions "quote" many times.

I agree with the premise that provisions 52.212-1, 52.212-2, and 52.212-3 all have sections/language that are not appropriate for a simplified acquisition using an RFQ, but that many of the elements of each of the provisions are just as necessary in an RFQ as an RFP (i.e. CCR Registration, Annual Reps and Certs). If you didn't include these provisions in an commercial item RFQ, you'd need to include a long list of separate FAR provisions (likely that would not be prescribed) or draw up your own provisions to include.

Finally, the fact that you can find people using it in RFQs on FBO is evidence of exactly nothing, except that people do all sorts of inappropropriate and improper things on FBO.

I agree that finding a recurring practice on FBO does not mean the practice is proper. K-Law Atty mentioned they had not see it done before; FBO has many examples of it being done.

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In reply to everyone, I would just say that we are probably talking about much the same thing but can't reach that conclusion in this type of communication forum. That said, I appreciate Vern's defense, which I will always gladly take, as I have long appreciated his viewpoint in a number of forums.

I would also say that the FBO search engine does not seem to me to be as inclusive in its results as I would hope. For example, I did a search as suggested by a previous poster and did NOT find the last three RFQs my agency had done. I did however find an offering from the Navy (Solicitation Number:

N6883609T0241) that was styled as an "RFQ" and included a technical evaluation. I am not saying that a tech eval is not allowed for an RFQ, but when we are buying straight commercial commodities based on lowest price--in other words, NOT a FAR Part 15-type procurement--I don't see the need for the extensive instructions. Our last RFQ, for example, simply included a parts list and offerors just provided a price quote for each part. So it just depends on the type of procurement--and that is the beauty of agency discretion and tailoring under the FAR.

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Just to make this issue more confusing, I checked the clause matrix in part 52. The provision is listed with "A" for "as applicable" under Simplified Acquisition procedures!

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