- The type of Materials Management (Parts) Contract you have at your site affects if/how/when the Customer is billed for parts. This article will just give you an overview of the basic types.
- Please check with your site manager to see which contract type you have at your site. It is listed in the Statement of Work (SOW).
- If s/he does not know, ask that s/he follow up with the Area Business Manager.
- This will affect how you do your billing at the end of the month.
There are basically four different types of Materials Managements Contracts that ATS Offers:
1. Fixed Cost
1.1. This is the simplest to understand. A FIXED COST Contract means that ATS does not charge an additional fee for Parts or Services. Everything is built into the Contract Pricing.
2. Cost Plus
2.1. In a COST PLUS contract, ALL Parts and Services are Billable, unless otherwise specified. An additional Markup is added to all Billable POs.
3. Management Fee
3.1. Management Fee is a variation of the Cost Plus Contract. No Markup is charged until the site reaches an agreed upon Annual Threshold Amount. Additionally, any work outside the scope of the contract should also have a mark-up fee charged.
4. Hybrid
4.1. The Hybrid Contract is the most complex.
4.1.1. Goods and Services POs are billed upon receipt.
4.1.2. Customer-owned materials are billed upon receipt (not consumption.)
4.1.3. ATS-owned materials are billed upon consumption (not receipt.)
If you do not know what kind of Contract your site has, you can contact your Area Business Manager, or your Supply Chain Support Program Manager.
When work is done outside of the scope of the contract, it is often submitted as "Project" work and entered on a T&M Quote.
5. When the sites submit their regularly scheduled Summary Parts Billing (this could be weekly, bi-weekly or monthly - based on customer demands), it does NOT include parts from T&M or project work, or anything that has its own, separate, customer PO.
ATS' goal is to move FROM T&M work as much as possible so that we will have better visibility into Part Spend at the sites. Contact your SCS Project Manager or Buyer if you have additional questions.