2-19 Consider Use of Options

The purchase/SCM team should consider the inclusion of option periods for additional performance for the following reasons:

Selecting the optimum contract length and the need for option periods for any given requirement are important elements of purchase planning and must be considered along with price, risk, market conditions, and industry norms in finalizing a period of performance for solicitation. (See Section 2-18, Select Contract Type and Period of Performance). Contracting officers should consider the inclusion of options within solicitations and resulting contracts as a means of continuing to fulfill the needs of the Postal Service. The exercise of options to extend a contract’s period of performance beyond what was initially contemplated should be assessed to determine whether it is more advantageous to obtain best value through option exercise or through re-competition. (See Section 5-8.7, Exercising Options.)

Portfolio manager approval is required where a contract’s period of performance, including options, will exceed or be extended beyond a total of eight years. (See Section 2-41.3.2, Reviews and Approvals of Contract Awards, Modifications, and Ordering Agreements.)