Definitions and Concepts > Goods vs Services

WAWF shipments must be characterized by the contract as being either Goods or Services. Here are some factors to consider:

•Materiality - goods are material items that can be touched, whereas services are amenities, benefits or facilities provided

•Tangibility - contracts which include tangible deliverables are Goods

•Ownership - delivery of the contract goods transfers ownership of items to the buyer; ownership of services is non-transferable

What confuses people the most are contracts that clearly for goods, but include services as separate line items. For example, a contract for a radar system is clearly for goods. The separate line items for installation, testing and training all seem like services, which technically they are. However, since they are considered part of the cost of the goods, they are also goods.

A good rule of thumb is that the determination of goods versus services is made at the contract-level rather than the line item. Contracts are generally all goods or all services. However, when in doubt, ask your contract officer!