The Product Acceptance phase marks the beginning of the contract management activities.  The purpose of this phase is to manage the relationship between the project and the vendor to ensure the vendor’s compliance with all contract requirements.  The project will complete a Contract Management Plan that identifies the roles and responsibilities of the project team and all activities that will be performed by the project staff to manage, track, amend and close the contract.

The Project is responsible for monitoring the supplier's progress to ensure all milestones have been met and approving work products. The performance of the contractor should be documented throughout this phase.  Performance evaluations document the contractor’s ongoing ability to work on the contract and as well as the contractor’s suitability for future work for the State.  This documentation forms the basis for early termination of the contract for non-performance and for determining how any penalties, fees, and/or incentive are applied. The success or failure of corrective action during the Product Acceptance phase is often determined in large part by the quality of the documentation the project has maintained related to deliverables acceptance and contractor performance.  Deliverable acceptance and evaluation documentation are therefore critical during the Product Acceptance phase.

The contract is considered closed and the phase ends when all deliverables and work products have been satisfied. Requirements for formal contract closure are outlined in the Contract Management Plan and should be followed accordingly.