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It really isn’t as much as people are making it out to be. If you get into the details, what has changed is they are making five year contracts versus yearly contracts. Ammunition orders under the Bush administration were around 230 million rounds per year so the increase isn’t that much. (also note, many of the ‘billions’ stories make it appear they are actually getting that much delivered, which isn’t true, they are simply contracting a negotiated price for up to a certain amount for a period of time).

What has changed, however, is going to half-decade contracts at one time. This has created bottlenecks in the system that has impacted supply and is in part, causing the shortages you are seeing now.

What you just said that is relates to the shortages we’re seeing now...doesn’t make any sense under the JIT delivery system.

What you said makes sense if somebody ...somewhere...is being required to actually stockpile that much. Whether it is in a government stockpile or at the production warehouse.... stockpiling it would cause a shortage.

Standard production JIT delivery on a 5 year contract would not...or should not at the rate we’re seeing now.

” they are simply contracting a negotiated price for up to a certain amount for a period of time).”

That is my understanding. A BPA deal.

“In accordance with Federal Acquisition Regulation (FAR) 8.405-3, ordering activities may establish Blanket Purchase Agreements (BPAs) under any GSA Schedule contract. GSA Schedules simplify the filling of recurring needs for supplies and services, while leveraging ordering activities’ buying power by taking advantage of quantity discounts, saving administrative time, and reducing paperwork. View the BPA training video series on our YouTube playlist.

To establish BPAs, ordering activities evaluate different contractors on Schedule for a particular category of supply or service, then establish an ongoing agreement for repetitive orders from the selected contractor. The agreement between ordering activity and Schedule contractors will generally look like this sample BPA format [Word, 27K].

Benefits and Advantages of BPAs
BPAs offer an excellent option for federal agencies and Schedule contractors alike, providing convenience, efficiency, and reduced costs. Contractual terms and conditions are contained in GSA Schedule contracts and are not to be re-negotiated for GSA Schedule BPAs. Therefore, as a purchasing option, BPAs eliminate such contracting and open market costs as the search for sources, the need to prepare solicitations, and the requirement to synopsize the acquisition.

BPAs also:

Provide opportunities to negotiate improved discounts;
Satisfy recurring requirements;
Reduce administrative costs by eliminating repetitive acquisition efforts;
Permit ordering activities to leverage buying power through volume purchasing;
Enable ordering activities streamlined ordering procedures;
Permit ordering activities to incorporate Contractor Team Arrangements (CTAs)
Reduce procurement lead time; and
Permit ordering activities the ability to incorporate terms and conditions not in conflict with the underlying contract.
A BPA can be set up for field offices across the nation, thus allowing them to participate in a customer’s BPA and place orders directly with GSA Schedule contractors. In doing so, the entire agency reaps the benefits of additional discounts negotiated into the BPA.

A multi-agency BPA is also permitted if the BPA identifies the participating agencies and their estimated requirements at the time the BPA is established.”