Service Contracts/Maintenance Agreements

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Introduction

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Definitions

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Definition summary

Policy and Procedure Statements

Most equipment generally requires some service to continue in operating condition. Therefore, it is often most economical to arrange for a service or maintenance contract with the manufacturer or service agency. The costs of service on the equipment must be borne by the using department and usually involves a service call charge, labor, and parts charges each time repair or maintenance is required. While parts and supplies are usually not covered in the service contract, the savings on service call and labor charges can make the lump sum payment for a service contract very reasonable.

Contract Initiation - A service or maintenance contract is initiated by submitting a procurement request to the Purchasing Office. Expendable parts are not usually covered under a maintenance agreement; therefore, a separate confirming procurement request must be issued and submitted to the Purchasing Office for charges not covered on the contract after service is performed