Boeing is the largest United States military and airplane manufacturing company in the world. William Boeing in Seattle United States found the company in 1916.William Boeing was an engineer in Conrad Westervelt of Aero products in the Seattle of United States. A year later Westervelt became the best and active service in the World War II, and the company was named Boeing Airplanes Company. The contributed a lot in the World War II since it produced the powerful bombers that help the United States a great deal. The company started the first international postal services in Seattle and Victoria in the British Columbia. At this time, the company was using its model 40 airplane to transact the postal services across the western countries. The company is the largest supplier, it enjoys half of the market in the airplanes, and it produces jet crafts, helicopter, military jets, missile system, and space technology. Boeing is superior in winning the federal government contracts in different departments where its services are relevant.

AT & T company information is another contracting company with the United States federal government. The company offers communication services to the united government, and its people spread worldwide. The founder Alexander Bells started AT & T Company in 1876 after his invention of the telephone. Alexander Graham Bell decided to open the AT & T Company in 1885 as a company, which was offering telephone services across the United States and its environs.

The company is a leading in terms in the provision of wireless and wireline services connecting several people, offices, and homesteads in America. In 1920s, the company started to transmit its private telegraph service radio transmissions across the United States. The company has undergone a series of development that has made it going global. AT & T company information is a global leader in the provision of wireless telephone services. It offers coverage of more than 225 countries, data coverage for more than 210 countries and ultra 3G network services in more than 170 countries.

Boeing won a fixed price contract from the United States department of defense tanker contract for about $35 billion. According to William J Lynn III, the Boeing won the contract on genuine circumstances, and it was clear that the Boeing had met all the requirements needed in war fighting. EADS was the company that had the contract before but was taken away from it to Boeing although Boeing was a point behind it in terms of contracting. The closest rival of the Boeing was the European Aeronautics Defense and space company.

Boeing was to construct more than 18 tankers before 2017. The defense department of the United States said that the first airplane was to cost $3.5 billion and the subsequent manufacture of other airplanes with relatively low prices. The bid winning Boeing received different reaction from the congress decisions. Its closest competitor the European aircraft manufacturer had promised to build a plant in mobile, Ala and therefore the bid failure led to a loss of thousands of jobs to American’s. Boeing was to be smart in production of military aero product.

The EADS was given ten days to make an appeal against the choice of the Boeing, and the air force decision settled on Boeing after a thorough look at the Boeing plant in Washington, Kansas and many more plants. Boeing was also considered the best airplane manufacturer that can produce 14 airplanes in a year.

The Boeing victory was said to be a big boost for the company in the production of its latest plane models such as the 787 Dreamliner. In addition, it will use the resources to fund and expand its production capacity to battle with the Airbus over their largest sale of freighters and passenger jets. According to the defense statement, the bidding was to mark the end of the replacing the old tankers which dated back to many years in history. The bidding was also perceived to the first time in which the defense forces were to receive the first tanker since 2001. Even though the defense budget was so constrained, the American airplane manufacturer was to receive more than $100 billion from that contract.

On the other hand, AT & T company information is a leading company in the provision of voice and data communication in the world. The company the government consumers and business which means that they have robust and reliable system that help in the transmission of information in long distances. Backed by the AT & T laboratories, the company can offer the sophisticated communication in the United States and rest of the world. The company recently introduced a high-speed internet bundles of local and along the transmission lines. The states that benefited from these services include Texas, Michigan, and Indiana.

The company has won several contracts given from the federal government of United States help execute communication services across in the United States. AT & T company information enjoys monopoly powers in the communication sector in the United States. The company is a leader on the internet services, long distance local and managed services in both the private and public sectors. The company also gives prepaid cards, collect callings, and give assistance in the contact directory. AT & T has achieved several awards for its outstanding customer service and performance.

The two companies; AT & T company information and Boeing Company were using fixed price contracts in their contracting with the government. It is because the government hires their services, and they set the price of the contract that the company is going to operate. The target price is sometimes bound to change, and it largely depend on the agreement between the two parties. The target price depends on the local and the global economics trends. Under a fixed price contract, the contractor agrees to deliver goods and services required at the price agreed upon and no more excess of the supplier to the target price.

Taking the example of a company lies the Boeing, secured a contract of more than $ 100 billion to produce more than 18 tanker airplane in the United States. Therefore, this means that it will Boeing operate within the limit of $100 billion to ensure that it has produced the required number of planes and supply to the United States defense department. Therefore, Boeing Company will be required to issue the specified number of planes it agreed to provide with defense department of the federal government of United States.

The AT & T company information will also enter an agreement with the United States federal government to provide its communication services through at an agreed price. Therefore, the company transmits its services as specified in the contract, and no more addition will be given apart from the agreed one. When the contract has expired, the contractor and the government or private sector enters into a new agreement and start signing the contract again. The government, for example, may decide to give the AT & T Company information start supply a certain amount of internet bundles to all its public offices. The company will do as required in the contract and no more than the required amount of bundles. Later on, the government will be required to enter a new contract.

The target price is subject to change because due to changes in unprepared circumstances such as economic instability of the country or the global economic change. For example in 2008, the global economy experienced a recession and many countries more especially the developing ones suffered the most. It is because their economies are fragile in that a small shock in the economy will cause a significant change in their economy.

When contract is processed and signed, there are costs that are always present in contracting. These are costs that sometimes link with distribution, transaction or even production of goods of the contract. Direct costs are costs that can link with the final objective. In other words, direct costs are those cost associated with production and provision of the commodity in question. These are values that appear in the earliest stages of making a deal, they also appear before the contract in a production stage. These are costs that contribute to the existence of the products or services the contractor is likely to provide.

Indirect costs are costs that are not in related to the final product or service. The contract and his client cannot include those costs in the target price prices because they are not sure whether they will happen or not. Indirect costs can be catastrophic or may occur in the middle of the production or processing.

The being company will incur both types of costs; Boeing company is responsible for the production and service provision. Direct costs for the Boeing Company will be the cost associated with the manufacture of airplanes. Direct costs can also be the cost of paying the workers and the rent for premises they are going to use such as land. The Boeing Company can also bear the costs of transporting the airplanes from the manufacturing plants to the defense airbase. On the other hand, Boeing can incur indirect costs such as cost of labor taxes, employee related expenses, acquisition or purchasing, inbound transport, cost of indirect labor and supervision, small indirect materials and supplies e.g. grinding wheels, among others.

AT & T company information also faces both direct and indirect costs. The company, for example, faces direct costs such as the cost for installing its infrastructure it uses to transmit its communication services such as satellites and the boosters. There also those costs concerned with the administration of the of their services, this are costs such as salaries they pay their work force, taxes they pay the government and others costs. Indirect costs include the cost such as depreciation caused by unforeseen circumstances such as economic instability, employee related costs and scrap sales credits and the costs of inventory adjustments.

A company is suitable for contracting when the company in question can minimize the costs in order to avoid chances of making losses that will result to the failure of provision of services or goods that is supposed to supply. The company, for example, the Boeing is a multibillion company that makes many profits and therefore it is not bound not to fail the client. Efficiency is also another factor one should consider, a company that produces efficient commodities or services should be a winning bidder and should be the contractor with the lowest bid.

In a scenario such as the one involving two companies such as Airbus and Boeing, competing for the same contract will recommend Boeing to for the agreement. It is agitated by the efficiency and trust of the company in many different markets in the world. The company is the largest airplane supplier and therefore able to supplier efficient and reliable airplanes. Some of the qualifications of a winning contractor as follow i.e. the winning bids should have a record of accomplishment, for example, Boeing has good records because it is in few circumstances their jets do not get accidents more often.

Lowest bidder mostly wins the contract of the government do not want even to waste money. The proposals made by the bidders should be precise and to the point. The contractor should clearly write to the government convincing it that it could carry out efficient based on the performance of the previous work or experience. A winning contractor must be smart in terms of writing skill and a professional qualifications for the contract. It is seriously taken care of because there are those contractors who will claim to have an expertise in a particular field but in the end fails the project.

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