22 Jan IDIQ Contract Advantages
In a previous article, we’ve gone over the purpose of an IDIQ contract, documenting and explaining the structure of such a contract. This time we’d like to go into more detail in regards to the advantages which are offered by such contracts to both project managers as well as contractors. As with any type of contract, when combined with the right project the strengths of the IDIQ shine. By understanding the high points of the IDIQ contract it can be used even more effectively.
Reliable Staffing and Services
Since IDIQ contracts keep a contractor responsible for an indefinite number of supplies and/or services over a set period of time, it allows project managers the comfort of always having a contractor on-hand and available. If the need arises for contract work, instead of having to worry about going through a lengthy bidding process on short notice, the project manager can simply contact the contractor they have contracted previously on an IDIQ contract.
This also has the added bonus of reducing expenses over a set period of time. This is because the time and resources involved in the bidding process end up draining resources which come from each project’s budget. By sidestepping that process and working directly with an IDIQ contractor, project overhead costs are reduced.
Scales Well For Difficult To Estimate Projects
Additionally, it is not always clear exactly how much work will be needed on certain types of projects. In these cases, if the amount of work is underestimated, an additional bidding process may become necessary during the project itself. Moreso, the original contractor working on the project may not be available to finish up said project after the duration of the original contract. In these cases, an IDIQ contract can save a lot of trouble, as it allows for the scope of work to expand out dynamically based on the needs of the project or projects.
An added benefit to using IDIQ contracts for these kinds of projects if the scope ends up under the estimated amount instead of over, the work required of the contractor can scale down. So long as a minimum amount of work specified by the contract is met- contractors are given work solely on an as needed basis which keeps project budgets tight.
Streamlines Multiple Small, Similar Projects
IDIQ contracts are also advantageous when it comes to batches of ongoing smaller projects over a period of time. If the projects are straightforward and similar enough, having the same contractor specified by the IDIQ contract move from one project to another can drastically increase overall efficiency.
What’s more is that the structure of an IDIQ contract makes it easy to start and staff additional smaller projects. Essentially, IDIQ contracts can work well when it comes to working on projects in an “assembly line” fashion. Small projects can be added or removed during the course of an IDIQ contract as needed with very minimal paperwork and overhead.