Advance Payment

Two possibilities:

1.  Read FAR subpart 32.2.  Do what it says.

2.  Award the purchase order to someone else.  You cannot force the contractor to accept the purchase order.

To elaborate on what ji says concerning 32.2, see two of the conditions for authorization of making advance payment for a commercial item in 32.202-1 (b):

“...(2) The contract price exceeds the simplified acquisition threshold;” and

”...(6) Prior to any performance of work under the contract, the aggregate of commercial advance payments shall not exceed 15 percent of the contract price;”

Foxfire_88 said:

I send the awarded PO to the contractor, whom does not sign it stating that they requested, advance payment.

There is no “awarded purchase order” or “awarded contract” yet. You have a modified quote that doesn’t meet at least two of the conditions for authorization for you to make advance payment. And it is higher than the original quote. You are, in effect, negotiating the quote. 

There is no valid contract to modify - There was no meeting of the minds.

If the firm won’t accept the purchase order without advance payment, your best course of action may be to look at the other quotes.

Another possibility, which may or may not be a “best course of action”, is to explain to the firm that you aren’t authorized to make advance payment and for the firm to consider what price it is willing to accept, if it has to  finance the furniture sale. You can negotiate...

Foxfire_88 said:

What's my best course of action?

Now my response is quick and would take some further in depth research but.....

You indicate a GSA buy.  You do not need to look at FAR 32 you need to look at the GSA contract.   If you did I bet there is no clause for advance payment.  If my bet is true then my conclusion is that to now allow the advance payment would make the order an "open market" procurement rather than an order under a GSA contract.

Noted here is the thought that I read in your OP no discussion about how the contractors pricing aligns with their GSA contract pricing.   Are they offering a further discount and then reversing that offer?   I do not need the details other to make the continued point that you are operating under the rules of FAR part 8.4 and the specific GSA contract so go there not elsewhere.

Course of action - My suggestion remove the vendor from the GSA competition.   Of course I might change my mind after more facts dribble out but that is my first call based on info offered.

Carl, You make a good point about staying inside 8.4.  Yes, always, when ordering against a schedule contract, read the schedule contract.  

Foxfire,

You said PO -- I suppose that means purchase order?  If the vendor doesn't accept the purchase order, your automated system should allow you to cancel it and make award to someone else.

Even if you awarded a delivery order, you should be able to cancel it because the order erred in that it did not faithfully mirror the vendor's quote (which was premised on an advance payment).  

You can negotiate with the vendor or select another vendor for award.

One more point.  Ask the vendor to show how his quote matches the GSA contract prices.  His price increase may not apply in his contract.

Just following the thread.  So GSA FSS are commercial item procurements.  Another roadblock to advance payments is this in my view.  Unless market research supports advance payments as an industry norm it would seem inappropriate to offer them to a single vendor. In other words tailoring the payments portion of 52.212-4 is not approproate.  Reference FAR 12.302.

All facts seem to stack up to a sorry but no answer to the vendor.