Original Date: 02/28/2000
Revision Date: 01/18/2007
Information : Credit Card Procurement
Crane Army Ammunition Activity implemented maximum use of the International Merchants Purchase Authorization Card in February 1996, and currently uses the system for 90% of small purchase procurements exceeding the Army’s goal of 80%.
Crane Army Ammunition Activity (CAAA) implemented maximum use of the International Merchants Purchase Authorization Card (IMPAC) and streamlined the procurement process. The previous procurement process was cumbersome and filled with delays. The procurement administrative lead time average was, at best, 60 to 90 days, and many times material substitutions were not satisfactory. A large backlog of orders built up in the contracting office due to personnel cuts from five buyers to two. Under the old method, procurement packages were sent to the contracting office regardless of dollar value. Technical packages were prepared and sent with the requisition. In order to alleviate the problem of inadequate material being supplied as a substitute, sole-source justifications were frequently required, and there was no adequate vendor rating system in place to eliminate problem suppliers. A solicitation was prepared and awards were made generally to the low bidder. Hard copy purchase orders were then prepared and mailed to the supplier.
In 1995, Congress mandated a simplified acquisition process. CAAA implemented the IMPAC credit card purchase system in February 1996 and currently uses the system for 90% of small purchase procurements exceeding the Army’s goal of 80%. The IMPAC cardholders assumed the ordering responsibilities as collateral duties. The cardholders order the material, check the status, receive the material, and balance their own procurements, thereby eliminating the cataloging, receipt, and issue functions previously required. The purchase is typically completed in one to two days, and emergency orders may be immediately picked up locally. The requestor receives the material ordered rather than a substitute and is able to dictate the quality of the material rather than the award going to the low bidder regardless of quality.
The credit card procurements are received in a more timely manner. By using the IMPAC, receipt and issue documents and transactions have been eliminated and indirect labor costs are lower. Contracting, supply, and finance workload and backlogs have been reduced. The suppliers are paid immediately rather than having to wait long periods for payment. When the Naval Surface Warfare Center eliminated the stocking of routine supplies, CAAA was able to use the credit cards to procure the items needed. The IMPAC has been universally accepted by all CAAA suppliers. In 1999, 3,890 procurements were processed with a total dollar value of $1,446,204.10.
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