Georgia Tech Procurement Assistance Center

GSA updates strategic sourcing tool for office supplies

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The General Services Administration in late November published a draft update of its seven-year-old strategic sourcing initiative aimed at reducing the costs of agency office supply purchasing.

The new statement of work titled “Office Supply Third Generation,” or OS3, is “the agency’s latest effort to cut costs and increase efficiencies by buying everyday supplies like pens, paper and printing items from a list of vendors with negotiated low prices,” GSA said in a release. It is expected to save $65 million a year in reduced administrative costs and $90 million through lowered prices, with 76 percent of purchasing contracts going to small businesses. Since 2006, the program has saved agencies $350 million, according to GSA.

Keep reading this article at: http://www.govexec.com/contracting/2013/12/gsa-updates-strategic-sourcing-tool-office-supplies/74702 

Janitorial supply and maintenance equipment contract opportunities designated for GSA Schedule-holders

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The General Services Administration (GSA) has just announced two contract opportunities for bulk purchases, one for janitorial supplies and the other for maintenance equipment.

If you are a GSA Schedule contractor, these opportunities may be of interest to you.  In order to bid on the janitorial supplies contract, you must be an existing holder of a GSA Schedule contract in categories 51V, 73 or 75.  In order to bid on the maintenance equipment contract, you must hold GSA Schedule 51V.

These new opportunities are part of GSA’s “strategic sourcing initiative” whereby multiple Government agencies agree to pool their contracting needs in certain categories of purchasing.  The two solicitations now open for bid involve products that cost the Government more than $1 billion annually, and GSA estimates that strategic sourcing will reduce the Government’s costs by 10-20 percent.

The departments of the Army, Navy and Air Force have committed to use GSA’s strategic sourcing solution for janitorial and sanitation supplies, as did the Veterans Affairs, Homeland Security, Treasury and Energy departments, and others.  Many of those departments also committed to the other solution GSA announced — the one for maintenance, repair and operations supplies.

GSA will issue blanket purchase agreements (BPAs) to multiple contractors under both of these solicitations.  Under BPAs, agencies can repeatedly buy the same supplies or services from a contractor without having to redo the procurement process each time.

For both the janitorial and maintenance solicitations, GSA says it is reserving a majority of the awards for small businesses and service-disabled-veteran-owned small businesses.

You can find the solicitations posted as follows:

* RFQ for janitorial and sanitation – https://interact.gsa.gov/node/62442

* RFQ for maintenance, repair and operations – https://interact.gsa.gov/blog/request-quote-rfq-issued-fssi-mro

Right now, the deadline for responses to these solicitations is Nov. 12, 2013, although you should always check the web sites listed above for any changes.

Questions about either of these solicitations are due not later than Oct. 22, 2013. For questions regarding the janitorial/sanitation RFQ or attachments, contact JoAnn Stanley at joann.stanley@gsa.gov and Steve Nieswiadomy at steve.nieswiadomy@gsa.gov.  For questions regarding the maintenance equipment RFQ or attachments, please contact Glenda Lambert at glenda.lambert@gsa.gov and Shaun Hankton at shaun.hankton@gsa.gov.

FY14’s top contracts will see growth

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The government’s largest contracts slated for release this fiscal year will be significantly larger than previous years, according to a new analysis.

The top 20 contract opportunities represent a combined potential business worth $160 billion over the contracts’ lifetime, or a 74 percent increase over the $92 billion value of last year’s top contracts, according to a new report by market research firm Deltek.

Request for proposals are expected to start rolling out in January, which should provide some breathing room for agencies to recover from the partial shutdown, said Jennifer Sakole, principal analyst for federal information services at Deltek. Whether contracts will be immune to impacts of the shutdown is unclear, but so far agencies haven’t announced plans to cancel or postpone these contracts.

Keep reading this article at: http://www.federaltimes.com/article/20131009/ACQUISITION/310090010/2014-s-top-contracts-see-growth 

Is strategic sourcing helping small business?

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Is the Federal Strategic Sourcing Initiative working for small business? Some in Congress and in the contracting community are worried that it’s not.

The concern raised by industry representatives, and by Rep. Richard Hanna (R-N.Y.) at a June 13 hearing of the Contracting and Workforce Subcommittee of the House Small Business Committee, is that the use of strategic sourcing vehicles are making it difficult for small businesses to compete to provide the government with goods and services.

As the single largest purchaser in the world, the U.S. government can alter market sectors when it makes buying decisions. If participation in a few huge, government-wide contracts is limited to relative handful of companies, a possible unintended consequence could be the erosion of competition in certain sectors. And that, in turn, could affect the value the government gets from these contracts by curtailing competition in certain areas over the long term.

Keep reading this article at: http://fcw.com/articles/2013/06/13/strategic-sourcing-small-business.aspx

GSA to pare back supply schedules, grow strategic sourcing

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The General Services Administration may consolidate its 31 Federal Supply Schedules into eight, a top agency official recently said.

GSA has floated the idea to industry groups and customer agencies of reorganizing the supply schedules program to make it easier for government buyers to navigate, Jeff Koses, GSA’s director of acquisition operations, said at a conference of the Coalition for Government Procurement.

“In some ways, schedules have become more complex to navigate than they were 10 to 20 years ago,” Koses said.

Keep reading this article at: http://www.federaltimes.com/article/20121025/DEPARTMENTS07/310250001/GSA-pare-back-supply-schedules-grow-strategic-sourcing?odyssey=nav%7Chead

SBA proposals could make small-biz credit easier to get

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The Small Business Administration is considering changes to its rules that would allow an agency spending its money through a task or delivery order to chalk up the awards to its own subcontracting plans, according to a Oct. 5 Federal Register notice.

Agencies could start to get credit toward their annual small-business  subcontracting goals for their orders placed against multiple-agency  contracts, a perk for agencies as procurement policy officials push  strategic sourcing.

Each agency has to set its own annual goal to make sure that various types of small businesses have an opportunity to participate in its contracts.

Currently though, when purchases come through an inter-agency contract, the agency that holds the contract gets the credit. That applies to the General Services Administration Schedules contracts too.

For example, consider an agency that places an order against a governmentwide acquisition contract. Say a large company gets the award and subcontracts some of the work to a small business subcontractor. The agency that hosts the GWAC gets the credit for hiring a small business, not the agency placing the order.

Prime contracts work differently. If an agency awards an order placed on a GWAC directly to a small business, the purchasing agency gets the points.

Agency officials have told SBA they would like to get the small-business subcontracting credit when they’re spending the money. SBA is also considering giving discretion to the contracting officer from the agency that’s placing the order to establish the subcontracting goals related to the individual orders.

Officials also want real-time insight into subcontracting on interagency contracts. Contractor may have to report their subcontracts with small businesses to the host agency’s contracting officer for each order.

Currently, contractors are reporting to the agency twice a year at the most.

“Reporting on an order-by-order basis will allow the funding agency to receive credit towards its small-business subcontracting goals,” SBA writes in its proposal.

SBA is taking input on the proposal through Dec. 5.

In light of SBA’s changes, Dan Gordon, administrator of the Office of Federal Procurement Policy, has pushed agencies to think beyond their own purchasing and, instead, buy with the government in mind.

Strategic sourcing gives the government leverage over the contractor in setting prices. A greater quantity of potential orders encourages contractors to lower prices.

Office of Management and Budget officials believe agencies want to use more interagency contracts in order to squeeze the most out of their funds and lessen their employees’ workload.

“Particularly in this tight budgetary environment, agencies have told us they are eager for tools that can help them stretch a dollar further and do more with less,” an OMB spokeswoman said Oct. 5.

SBA’s proposed change may make subcontracting goals slightly easier to meet, especially if agencies are turning more toward the interagency contracts, said Ken Dodds, senior attorney at SBA.

He said agencies would find it more difficult to meet subcontracting goals if they didn’t credit.

About the Author: Matthew Weigelt is a senior writer covering acquisition and procurement for Washington Technology.  This article appeared Oct. 12, 2011 at http://washingtontechnology.com/articles/2011/10/12/sba-subcontracting-credit-multiple-agency-contracts.aspx?s=wtdaily_141011.

OMB announces final guidance on inherently governmental functions

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Long-anticipated final guidance on “inherently governmental functions” is set for publication on Monday and should clarify confusion over blurred lines in agencies’ understanding of which types of work should be outsourced, top officials at the Office of Management and Budget told reporters on Friday.

The final policy letter, said Chief Performance Officer Jeffrey Zients, “helps agencies do better at balancing contracting out with management by federal employees. The mix was out of balance and we think this protects the public interest. Given our fiscal situation today, it is important more than ever that taxpayer money be well spent.”

With a few exceptions, the guidance, which takes effect Oct. 12, is similar to the draft released in March 2010, said Dan Gordon, administrator of the Office of Federal Procurement Policy. “But it is a milestone” that follows up on a memorandum of understanding about reducing waste in contracting issued by President Obama in March 2009.

The document includes lengthy lists of functions that are clearly inherently governmental and separate lists of “functions closely associated with the performance of inherently governmental functions” — where agencies can use more discretion.

One difference in the new guidance is a provision intended to “clarify the confusing and controversial” policy on the contracting out of military security operations, Gordon said. If a function is part of combat or could evolve into combat, then contractors can’t be used. “We benefited on this issue from public comments from the private sector, agencies, nonprofits and the Hill,” he added.

A second departure is a provision intended to help small businesses. “It places a lower priority on in-sourcing if the function is not inherently governmental,” Gordon said. “Insourcing is not a goal, but agencies need to understand that if an inherently governmental function is improperly contracted,” they can lose control of the work.

The administration “is sensitive” to realities of the current budget crunch, Gordon acknowledged. “We need to demonstrate fiscal responsibility on both sides” of the contracting process, he said. “We don’t want to dramatically increase [full-time equivalent] levels on the federal side, but in today’s fiscal world, the solution is not massive contracting out,” nor is it massive insourcing.

Zients presented the letter in the context of the administration’s two-and-a-half-year-old effort to trim waste by curbing contracting “after its uncontrolled growth under the prior administration.” One in six federal dollars is contracted out, and the rate, mostly in services, doubled since 2008, he said. But 2010 marked the first time in a decade that the level of contracting decreased, by $80 billion.

Examples of smarter contracting, Zients said, include “strategic sourcing,” such as pooling purchases of office supplies, which can save as much as 40 percent. “Rather than buying like 100 medium-sized businesses, take advantage of the fact that the United States is the world’s largest purchaser,” he said.

Another means is cutting spending on management support, which quadrupled over the past 10 years, he added. “In information technology and acquisition, management support produces many wasteful and unnecessary consultants’ reports that sit on a shelf.” That approach will reduce expenses by 15 percent, or $7 billion in fiscal 2012, he said.

Focusing on interaction with contractors, the administration also has “strengthened suspension and debarment” processes, Zients said, stressing, however, that “contractors do valuable work and will continue to do so.”

Over the past year and a half, Gordon said, the outsourcing-insourcing issue has been reviewed most thoroughly by the Defense and Homeland Security departments, a process now largely complete. Most agencies have already been working under the principles of the final guidance, he said, so its release won’t prompt major shifts.

Critical functions differ by agency, Gordon said, but the letter provides “clear direction to managers responsible for policy on the closely associated functions to make sure that the agency can control it and that the work doesn’t expand.”

The problem, he said, though “now largely corrected,” has been that some agencies, for example, would have a contractor write a statement of work and then award the contract to that same company. In managing IT functions, he added, he’s heard federal managers say that “no one in-house understands the work and that they’re completely dependent on the contractor. It’s intolerable.” The solution, he said, might be limited insourcing, adding two to three people, or simply applying more attention.

The guidance’s definition of inherently governmental, as in the draft, is based on the 1998 Federal Activities Inventory Reform Act, and Zients said the letter’s other changes, though small, would require adjusting the Federal Acquisition Regulation to conform.

Dozens of interest groups had been following the evolution of final guidance on what is inherently governmental.    “We are pleased OFPP has retained flexibilities for agencies to determine what functions are considered closely associated with inherently governmental functions or are critical functions to agency missions and to provide for these functions in a way that best meets their needs and capabilities,” said Stan Soloway, president of the industry group the Professional Services Council. “However, we are concerned that the list of closely associated functions could be misconstrued as a ‘do not contract’ list, even though it is not the case, nor OFPP’s intent. The checklist that identifies closely associated functions must not become a barrier to contracting for work where it is appropriate to do so.”

Scott Amey, general counsel of the watchdog group the Project on Government Oversight, said he is impressed with the guidance. “The policy comes clean about the government’s over-reliance on contractors and improves the categories of activities and functions that shouldn’t be performed by contractors,” he said. “Private security in combat areas was never a good policy, and OFPP’s changes will ensure that properly trained and mission-responsible government personnel conduct such work.” He wonders, however, whether agencies will actually retain or insource work that his group believes should be performed by public servants.

Steve Amitay, federal legislative counsel of the National Association of Security Companies, said on Friday that absence of any mention of “building security” in the guidance “validates the continued successful use of contract security by federal agencies. Furthermore, given the decades of effective and efficient use of contract security by federal agencies, any agency that is considering insourcing security jobs should, as the policy states, be required to conduct an in-depth, comprehensive cost-analysis of such a move.”

— by Charles S. Clark – Government Executive – September 9, 2011 – http://www.govexec.com/dailyfed/0911/090911cc1.htm?rss=getoday&oref=rss

New Congress could put the brakes on insourcing

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The 112th Congress is unlikely to let the Obama administration move full-speed ahead on its initiative to bring contractor jobs back in-house, a consultant and a Republican Senate staff member said on Thursday.

Jonathan Etherton, president and owner of the consultancy Etherton and Associates Inc. and a former Senate Armed Services Committee staffer, told an audience of contractors at a Coalition for Government Procurement breakfast he has heard at least three congressional panels plan to look at whether insourcing is being implemented strategically and whether agencies are focusing on critical positions.

Bill Wright, Republican staff director for the Senate Homeland Security and Governmental Affairs Ad Hoc Subcommittee on Contracting Oversight, noted insourcing is on the radar of ranking member Sen. Scott Brown, R-Mass. Brown is concerned the initiative is moving forward too quickly and without enough consideration of its effect on small businesses, Wright said during the breakfast discussion.

More generally, Brown is looking for ways to improve efficiency during times of mounting national debt, Wright said. The senator is developing an acquisition savings plan that could include expanding strategic sourcing, an approach in which agencies analyze purchasing trends and buy common commodities and services in bulk; rewarding high-performing acquisition teams; and promoting a more specialized acquisition workforce by requiring officials to obtain certifications in certain areas of expertise.

New Congress could put the brakes on insourcing  Much of the subcommittee’s oversight work to date has been bipartisan, Wright added, and Brown is working with the administration on the efficiency initiatives.

Etherton noted, however, that Congress’ overall relationship with the executive branch is likely to grow more adversarial in 2011 with Republicans in control of the House and lawmakers aggressively scheduling oversight hearings.

In addition to insourcing, Etherton said, the next Congress is likely to examine implementation of the 2009 Weapons System Acquisition Reform Act; the relationship between the Defense Contract Audit Agency and the Defense Contract Management Agency; the definition of inherently governmental work; how to best ensure adequate contractor controls against waste, fraud and abuse; and how Defense Department savings initiatives will affect the industrial base.

Wright predicted lawmakers also would focus on transparency surrounding contractor profit incentives and subcontractor performance; tracking contract-related earmarks; and enhancing competition and limiting risk through fixed-price arrangements.

— by Amelia Gruber –  Government Executive – December 16, 2010

Air Force ramps up new strategic sourcing office

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The Air Force has established a new unit to leverage the purchasing power of its 70 U.S.-based installations and save up to $2.3 billion during the next five years.

The Enterprise Sourcing Group, launched in late October, will follow a strengthened strategic sourcing strategy in which it buys commodities and services that are common to most Air Force bases in bulk. The goal, officials said, is to streamline the acquisition process while obtaining better prices.

“We are creating efficiencies across the Air Force as a whole, which is a good thing for everybody,” Mario J. Troncoso, the unit’s director, told Government Executive earlier this week. “Centrally procuring gives us good control. We can do continuous improvement cycles and relook at these things while at the same time being transparent to taxpayers and our government.”

The initiative has gone through a number of changes in recent years. The Air Force in 2007 announced plans to open five regional strategic sourcing contracting centers, but the economic downturn, along with various issues on bases, made the idea less “palatable than it originally looked on paper,” Troncoso said.

The service then shifted its strategy and concentrated on developing a more centrally located unit at Wright-Patterson Air Force base in Ohio. The Enterprise Sourcing Group will house about 400 contracting officials and include a small business office, a business support group and three enterprise sourcing squadrons. Six commodity councils will manage the acquisition process. The Air Force also is standing up satellite offices for the unit in Texas, Alabama, Florida and Nebraska.

Expectations are high. Domestic Air Force bases spend about $10 billion on contracts for commodities and services annually and the Enterprise Sourcing Group will manage roughly half that total within the next five years. Internal estimates show the unit could save up to 15 percent of what the service now spends for common goods and services by standardizing requirements, better analyzing past purchases and eliminating redundant acquisition efforts.

For example, the group’s Information Technology Council has begun awarding centralized procurements for desktop computers while its Force Protection Council has issued contracts for gear and equipment for security personnel, Troncoso said. Agreements for office supplies, furniture and medical services also are under way.

“We will be saving money and manpower by approaching installation contracting from a strategic perspective,” Gen. Donald Hoffman, commander of the Air Force Materiel Command, said during an Oct. 28 activation ceremony. “However, we will not lose sight of small business. That’s been my pledge and my challenge to the new group to motivate, stimulate and encourage small business.”

Getting small firms involved often has been difficult for agencies implementing wide-ranging strategic sourcing plans. Typically, when small contracts are bundled together, the total cost and labor required to complete the work are out of reach for small businesses, leaving midsize and large firms as the primary bidders.

But, Troncoso said the Air Force is willing to make cost trade-offs in an effort to consider small businesses. Other times, the service might have to expand its market research to seek out new candidates, he said.

“There is no one cookie-cutter answer to how we can structure contracts in a way to make it more or less small business friendly,” he said. “It’s something we are going to have to roll into our entire process.”

Strategic sourcing, which gained steam during the George W. Bush administration, is part of a larger Defense Department effort to reduce overhead spending and redirect $100 billion to the warfighter. The Pentagon plan also includes closing the U.S. Joint Forces Command, a 10 percent reduction on service support contractors during each of the next three years, and decreasing funding for intelligence advisory and assistance contracts.

In addition to contracting at bases, the Enterprise Sourcing Group will award procurements for the Air Force Center for Engineering and Environment, the Air Force Civil Engineer Support Agency and the Defense Technical Information Center. The group also will support Air Force medical contracting.

—  By Robert Brodsky – GovExec.com – November 11, 2010

Purchasing agreements emphasize strategic sourcing, vendor diversity

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Federal contracting officials can save nearly $200 million during the next four years by buying office supplies through one of 12 new blanket purchase agreements, the General Services Administration said on Wednesday.

The agreements — essentially charge accounts set up with certain companies — will help agencies meet the Obama administration’s goal of cutting contract spending by 7 percent by fiscal 2011, according to GSA officials.

The 12 agreements use strategic sourcing to consolidate purchases and leverage the government’s buying power. GSA said the pricing structure would save government buyers $48 million annually or $192 million over the life of the agreement. Agencies could spend as much as $800 million through the agreements during the next four years.

“These agreements show how [the Federal Acquisition Service’s] skillful negotiations can, and do, leverage the buying power on behalf of agencies governmentwide,” said Steven Kempf, acting commissioner of GSA’s Federal Acquisition Service. “The expertise and care the contracting team displayed have driven the prices down and opened doors for sustainable technologies and environmentally preferable products, while providing substantial opportunities for small business.”

According to the request for proposals, issued in March, a formalized commodity team, made up of officials from more than a dozen agencies, helped establish the agreements’ requirements. Many of those agencies have made funding commitments to use the agreements, the document said.

“Some participating agencies currently have established agency-specific vehicles for the purchase of office supplies with advantageous pricing,” the RFQ stated. “The aggregate participation of these and other agencies should result in pricing that is more competitive than that which a single agency can achieve. To this end, the contractor is strongly encouraged to offer BPA prices that are lower than pricing offered to any other federal government agency.”

The agreements are divided into three pools of companies offering office supply catalogs. The first pool is composed of seven small businesses, the second includes two companies that are focused on price and the third consists of three service-disabled veteran-owned small businesses offering discounted prices on toner catalogs. Each of the pools emphasizes price and sustainable or environmentally friendly products.

Daniel Gordon, the administrator of federal procurement policy at the Office of Management and Budget, lauded the purchasing structure.

“The agency is doing a very good job in balancing our commitment to low prices with our commitment to smoothing the path to the federal marketplace for small businesses and service-disabled veteran-owned small businesses,” Gordon said during a recent interview with Government Executive.

The agreements have other unique features, Gordon said. Unlike most BPAs, which are available only to a few agencies, they will be open governmentwide and available to all federal employees, he said.

“If you are a federal employee and you go into the winning vendor’s store, you give them your federal purchasing card and you will automatically get these prices,” Gordon said.

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— by Robert Brodsky – GovExec.com – June 3, 2010

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