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How long can government contracts last?

On Behalf of | May 1, 2023 | Government Contracts |

Landing a government contract can be a very lucrative opportunity. Not only does the government buy services and products in large quantities, but the contract may last for more than one calendar year. For some businesses, getting their foot in the door with a contract gives them a stable income that they can count on.

How long does any particular contract last? It depends on the specifics of the deal that is in place, and some contracts may be very short or even for one-time purchases. The most important thing to note is that most government contracts are capped at five years.

What type of contract is it?

It’s important to consider the type of services or products being provided and the type of contract being used. For instance, the five-year limit above is generally instituted for physical supplies, but it’s not going to apply to most contracts written for the information technology industry. These contracts will likely only remain valid for shorter durations. Additionally, the Service Contract Labor Standards statute can restrict some contracts even within the five-year period that is laid out for supplies.

Completion dates can be amended

Additionally, the government does note that a completion date can be amended to add more days, weeks or even months to a contract. This can allow additional time for the services in the contract to be performed or the products to be delivered. A failure to deliver is not a breach of contract if the scenario in question has been officially amended in advance of a missed deadline.

The government needs those who enter into contracts to be flexible

Government demand for certain goods and services can increase dramatically during wartime, for instance, while the demand may be very different during peacetime. The government also has to consider the fact that their budget must be approved annually, so the amount of money at their disposal can change. As a result, they may require those who provide goods and services to be unusually flexible with their approach.

Do you run a business that works with the government and tries to land these contracts on a consistent basis? Scheduling is just one thing you need to be aware of as you go through this process, and it’s important to know exactly what legal options you have at your disposal.