Glossary

Contract Types & Pricing

The pricing structures, cost elements, and contract types government contractors price against, from firm-fixed-price and cost-plus arrangements to indirect cost, full-time equivalent, and earned value management. Written for pricing analysts, cost volume leads, and capture managers building a competitive and compliant price.

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Basic Ordering Agreement
Written understanding between agency and contractor for future contract terms — not itself a contract.
Contract Types & Pricing
Blanket Purchase Agreement
Simplified method for repetitive purchases from qualified sources — like a charge account.
Contract Types & Pricing
Contract Line Item Number
Unique identifier for each separately priced item or service in a contract.
Contract Types & Pricing
Cost Accounting Standards
Rules governing how contractors accumulate and report costs on government contracts.
Contract Types & Pricing
Cost-Plus-Award-Fee
Cost-reimbursement contract with a base fee and an award fee earned based on performance.
Contract Types & Pricing
Cost-Plus-Fixed-Fee
Cost-reimbursement contract: allowable costs reimbursed plus an agreed-upon fixed fee.
Contract Types & Pricing
Cost-Plus-Incentive-Fee
Cost-reimbursement contract where fee adjusts based on actual costs vs. target costs.
Contract Types & Pricing
Direct Cost
A cost specifically identified with a particular contract (e.g., labor, materials on that contract).
Contract Types & Pricing
Earned Value Management
Methodology integrating scope, schedule, and cost data to measure project performance.
Contract Types & Pricing
Firm-Fixed-Price
Contract providing a fixed price regardless of actual contractor costs. Greater risk on the contractor.
Contract Types & Pricing
Fixed-Price-Incentive-Fee
Contract with target cost, target profit, ceiling price, and profit-adjustment formula.
Contract Types & Pricing
Forward Pricing Rate Agreement
Negotiated agreement establishing billing rates for future contract pricing.
Contract Types & Pricing
Full-Time Equivalent
Measurement unit representing one employee working full-time for one year.
Contract Types & Pricing
General and Administrative
Indirect expenses for overall business management, allocated across all contracts.
Contract Types & Pricing
Indefinite Delivery Indefinite Quantity
Contract vehicle providing indefinite quantity of supplies or services during a fixed period.
Contract Types & Pricing
Independent Government Cost Estimate
Government's internal projection of what a procurement should cost.
Contract Types & Pricing
Indirect Cost
Costs not directly accountable to a contract: fringe, overhead, G&A, B&P, IR&D.
Contract Types & Pricing
Labor Category
The classification of positions priced and bid on a contract (e.g., Engineering Technician III).
Contract Types & Pricing
Multiple Award Task Order Proposal
An IDIQ contract with more than one winner. Winning the vehicle doesn't guarantee work.
Contract Types & Pricing
Time and Materials
Contract based on direct labor hours at fixed rates plus materials at cost.
Contract Types & Pricing