Material & Disbursement Services (MSD)
POLICY 10
Effective Date: 03/01/1998
Last Modified Date: 02/17/2004
Standing Orders
A "standing order" is a purchase order that has been issued to a vendor, against which purchases may be made. When repeated purchases of the same type of supply item are expected, multiple purchase requisitions may be eliminated by submitting one purchase requisition to establish a standing order. The "open" parts of the arrangement are the timing of individual requests for the type of item covered by the order and the number of items requested each time. New standing purchase orders must be issued each fiscal year.
Approval
Requests for standing orders are issued by Purchasing Services. It is important to advise Purchasing of the total (not-to-exceed dollar amount) anticipated for 12 months so that the appropriate purchasing authorization can be obtained. Failure to obtain the appropriate authorization up front may limit your ability to encumber additional funds without seeking additional or higher-level approval authority.
Competition
All standing orders are subject to the rules of competitive procurement. Single-source or brand-name orders must be justified (see MSD Policy 7, Single-Source or Brand-Specific Purchases).
Estimated Cost
Before the purchase order is issued, the requesting department's budget will be encumbered in the amount of the estimated total cost as indicated on the purchase requisition. If a standing order is cancelled, the outstanding balance on the order will be liquidated, thus making the funds available for other purchases.
Additional Information
See also:
MSD Policy 7, Single-Source or Brand-Specific Purchases
MSD Procedure 2, Blanket or Standing Purchase Orders
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