Getting a Hand From the Government
It’s that time again! The culmination of that gleeful season where the United States government goes on its end-of-fiscal-year buying frenzy.
We are in the midst of the final lucrative quarter of the government’s end-of-year purchasing. September is the climax of many months of effort for successful government security contractors that have worked feverishly to finalize and accept their long-awaited orders before time and money run out!
As the successful rejoice in their bounty, there are those that aren’t partaking in the celebration. Some are wondering what they could do to obtain homeland security work. Others wish to do business with the government, but just don’t know how.
The very thought of dealing with the paperwork, regulations, procedures and other burdens keep many companies on the outside of government contracting.
Successful contractors have no doubt utilized the General Services Administration’s (GSA) schedule contracting vehicle as an essential tool to take orders. GSA has improved its programs the past few years, taking significant steps to make it easier and better for both the contractor and the buyer through new technology.
The GSA and the Department of Defense (DOD) launched last year the “Get It Right” program to ensure proper use of GSA contract vehicles to improve the federal acquisition process and allow agencies to obtain the best value when acquiring supplies and services. The joint effort came about after improper usage of the program and out-of-scope buying.
Whether you have made it big, have recently entered the competitive and challenging government sales market or are still considering it, all contractors should fully understand the benefits vs. the burdens of using the GSA Schedule program. Contractors need to know the “what,” “who,” “why,” “where” and “when” of the program to be successful. The following story will review some of the basics, reveal some significant changes, provide a reminder of requirements, discuss complicated compliance issues and give some seasoned advice to help you on that hard-won path to obtaining homeland security opportunities.
Answering the ‘What’ Questions of GSA Schedule Programs
What is a GSA Schedule contracting vehicle or program?
The GSA Federal Supply Service manages a program for streamlining U.S. government procurement. The service provides a contracting vehicle offering multiple sources of supply for products and services.
The program is designed to assist federal agencies in meeting their compliance requirements for purchasing while saving significant time and money. Utilizing electronic tools, agencies can easily find multiple sources, comparing pricing to help make a best value decision in their buying process. They may easily locate points of contact with the suppliers for technical support.
The GSA Multiple Award Schedule (MAS) Contract, also known as “the Schedule,” is a five-year contract with three five-year options to renew with pre-negotiated pricing and terms determined to be fair and reasonable through the negotiation process and review.
Using the GSA contract to buy, agencies are not required to list opportunities as in a formal bid, even though the buy exceeds the simplified purchase threshold (a volume level that triggers possible additional concessions for the agency). However, they must review pricing listed on the GSA program and at least three contractors’ products to make a best value decision for award. There are numerous GSA contract programs for specific products and services.
What are the basic requirements for a GSA Schedule Contract?
Prospective companies submit their commercial pricing and sales practices to GSA through the completion of the GSA solicitation package. GSA negotiates with the company to arrive at terms equal to the company’s most favored customer.
This customer category will be the basis for terms throughout the contract period. Pricing and products may be updated per specific regulation during the contract period.
GSA contractors must comply with a number of requirements following the award of a GSA contract:
- Contractors must accept all orders below the maximum order threshold.
- Contractors must accept all credit card orders up to $2,500.
- Contractors must file an Equal Employment Opportunity Commission (EEOC) report once a year and a Vet 100 report yearly with the Veterans Administration (VA).
- Contractors must report GSA sales quarterly to the online GSA vendor support center.
- If required, contractors must file the appropriate Small Business Administration (SBA) subcontracting plan for large businesses.
- Contractors must pay the Industrial Funding fee and maintain a GSA order-tracking system.
- Contractors must keep records for three years following the expiration of their GSA contract.
- Contractors are required to create and distribute a GSA price list and load the pricing to GSA’s “GSA Advantage!” Web site — www.gsaadvantage.gov — for agency search and purchase.
‘Who’ the Players Are Behind Government Contracts
Who uses the GSA contract?
All federal agencies can use the GSA Schedule contract for buying. In fact, Federal Acquisition Regulations (FAR) directs agencies to first review the GSA MAS program as the source for their procurement.
Those eligible to use the contract are listed on GSA’s Web site. Also note that prime government contractors or cost-reimbursement contractors with a letter of delegation may buy using the GSA contract.
Under the GSA IT contract, state agencies are authorized under the Cooperative Purchasing Act to use the contract for purchases.
Who can be listed on a GSA contract?
First, let’s clarify: a GSA contract is not a list to which your company gets added. As previously discussed, a company must complete a solicitation package and include other required documentation.
The process requires a company to disclose its commercial terms and pricing, past performance information and other financial data for review by GSA. Following negotiations and acceptance of the terms, the awarded contractors represent manufacturers, distributors, dealers, integrators, consultants and other professional service contractors.
What companies offer to GSA can mirror their commercial practices to a certain extent. For example, a manufacturer may elect to sell directly to government end users. However, as many manufacturers sell their products commercially through distribution and dealers, GSA acknowledges that the same market approach may be used in selling to the government.
The contractor may negotiate for an allowance so that the dealers and integrators may be a participant. In many of these contracts, the dealers selected to participate will sign an agreement with the manufacturer and be permitted to accept the order and invoice the government directly.
In addition to partnering with their dealers on a GSA contract, manufacturers may also grant permission to a dealer, distributor or integrator to submit on their behalf. In this instance, the manufacturer would be able to offer their products to the government without being involved in the order or invoice process. In particular, it would not be bound b
y the GSA contract requirements or rules.
Most of the leading manufacturers have either delegated or initiated a GSA program that allows dealers to participate. Many successful dealers or integrators also have their own GSA contracts.
‘Why’ Washington D.C. Can Be a Great Customer
Why should my company obtain a GSA Contract?
The U.S. government is the largest purchaser of goods and services in the world. They are definitely in the market for security equipment and services. The government is a repeat customer with multiple locations around the world, and it pays its bills.
The GSA contract is applicable for any size order. Government agencies have purchased more than $200 billion using the GSA Schedule contract. Last year, Schedule 084 reported almost $2 billion in sales.
The speculation for this year is about the same, with more than $1 billion reported at the end of the second quarter.
If you wish to sell to the government, it is extremely difficult to initiate business without a GSA Contract. One of the first questions a government agency may ask a vendor during a sales visit is, “Does your company have a GSA contract?”
The paperwork is less cumbersome for both you and the government agency when using a GSA Schedule contract. During the negotiation process, your company’s past performance and financial information are reviewed and given the “thumbs up.” Your pricing and terms will have been negotiated in advance and deemed “fair and reasonable.”
Why would a government agency choose to use the GSA contract?
There are simplified ordering procedures per FAR_8.405 that reduce paperwork and add customer discretion. Agencies can make a best value decision based on the price and overall value of the procurement, rather than just on the pricing.
Why best value? Best value includes preference for special features, delivery times, compatibility with existing systems and anything else that might effect a customer decision.
Most important, there is no ceiling on the order size! The “maximum order” level awarded per specific contract is a threshold for seeking a price reduction. If an order exceeds the maximum order threshold, the government is instructed to ask for additional concessions.
Find Out ‘Where’ You Can Pick Up Government Bids
Where do I find government opportunities?
All formally advertised bids or opportunities above $25,000 may be viewed at www.fedbizopps.gov.
There are also many services offered by private entities to review both federal, state and local government projects as well as other opportunities.
Security Sales & Integration has a program that alerts contractors to opportunities. It is called LeadTracker and it is unique to the security industry. Visit it at www.ssileadtracker.com.
An often-overlooked source for opportunities for contractors is GSA’s newest online tool called eBuy. Not be confused with eBay, eBuy, is a GSA Advantage!-based requests for quotes (RFQ) solution. It facilitates requests and submissions of quotes for a wide range of commercial services and products that are offered by sellers that registered on the GSA Advantage! Web site.
‘When’ to Jump Into the Federal Buying Spree
If I want to get started, when can I begin the process?
Several years ago, GSA modified the regulations allowing for a “continuous open season.” A contractor may submit a GSA solicitation offer at any time.
The time it takes to prepare and submit your offer will vary depending on your knowledge of the process and the complexity of the offering. Once your offer has been submitted and logged in at GSA, the time to award is 100 to 150 days.
The length of time to award depends on the backlog at the commodity center or the contract you have chosen. An incomplete offer may further delay the process.
When does the Government buy?
The Government’s fiscal year begins Oct. 1 and ends Sept. 30.
While the Government has ongoing needs for many products and services, there is usually a long cycle leading up to the buying of a project.
At the beginning of the year, budgets are still being considered. The first two quarters of the year may be pretty lean. But activity picks up in the third quarter as agencies are finalizing their buys for using up their budget before the year ends.
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