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Selling to Federal AgenciesSelling to Federal Agencies Using GSA’s Using GSA’s

Federal SupplyFederal Supply SchedulesSchedules

June 17, 2003

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The Discussion Panel

Jim Czysz, General Services AdministrationPh. 888-353-5383 jim.czysz@gsa.gov

Todd LaMastres, Ernst & Young LLPPh. 214-969-8484 todd.lamastres@ey.com

Teague Newhart, Ernst & Young LLPPh. 202-327-7591 teague.newhart@ey.com

Dawn Greenwood, Federal Supply ServicePh. 630-527-0648 dawn.greenwood@gsa.gov

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The Agenda

Introduction to GSA Federal Supply Schedules How to Become a GSA Schedule Contractor Preparing a Valid Offer to a GSA Solicitation Managing the Risks After Contract Award Marketing Tips Q&A

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Introduction to GSA Federal Supply Schedules

Multiple Award SchedulesFast, easy, and effectiveAccessible Government-wideOver 11,000 contracts in placeOver 4 million products and servicesCommercial items

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GSA Schedule Sales

0

5

10

15

20

25

1996 1997 1998 1999 2000 2001 2002

$ Billions

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Services vs. Products(% of Sales)

0%

10%

20%

30%

40%

50%

60%

2002

ServicesProducts

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Services vs. Products

Services– Info Technology– Engineering– Financial– Logistics– MOBIS (Mgmt,

Organizational, and Business Improvement Services)

– . . . more

Products– Office Equip &

Supplies

– Furniture

– Hardware

– Scientific

– Energy products

– . . . more

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Who Buys Services and Products from Schedules?

Executive and Other Federal Agencies are eligible users of the schedules program

All eligible users are non-mandatory but highly encouraged by their Command or Management Officials

The GSA number is not similar to a registration or license number. It is a valid contract between GSA and the vendor to supply an indefinite quantity of product or future service requirements at agreed upon terms for 20 years (renewed every five years)

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Top Ten Federal Buyersfor Small Business

DOD – www.dod.gov $143B

DOE – www.doe.gov $19B

NASA – www.nasa.gov $11B

GSA – www.gsa.gov $11B

VA – www.va.gov $6B

USDOJ – www.usdoj.gov $5B

DHHS – www.os.dhhs.gov $5B

USDA – www.usda.gov $4B

DOT – www.dot.gov $2.5B

USTREAS – www.ustreas.gov $2.5B

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Socioeconomic Profile

FY2001 FY2002

Small Business $ 5.5B (33.6%) $ 7.2B (34.2%)

SB Disadvantaged 1.5B (8.9%) 2.0B (9.7%)

SB Woman-owned 744.3M (4.5%) 971.7M (4.6%)

8(a) 249.8M (1.5%) 444.7M (2.1%)

SB Veteran-owned 207.0m (.5%) 197.4M (.9%)

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How to Become a GSA Schedule Contractor

Obtain Solicitation from www.FedBizOpps.gov

Complete Solicitation – provide information requested

Submit/Mail to address specified

Evaluation – respond to request for additional info

Negotiation – Successfully negotiate prices, terms, and conditions

Award is made and contract number is assigned

Pre-Award process can take about 6-8 months

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FedBizOppsOnline source to download solicitations from Federal Agencies

www.fedbizopps.gov General Information Vendors – Find Business Opportunities Vendor Notification Service News PRO-Net SUB-Net Help

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Preparing a Valid Offer toa GSA Solicitation

Reference: The FSS Reference Guidehttp://apps.fss.gsa.gov/contractorguide/

The offer or proposal is comprised of the following: A Standard Form (SF) 1449 The solicitation A commercial price list A Commercial Sales Practices Format (CSP Format) Past Performance Evaluation Report Other data as necessary

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SF 1449

The cover page to your offer/proposal Each offeror must complete blocks 12, 17,

23, 24, and 30 Must be signed by an authorized person of

the company When an offer is accepted, SF 1449 is

executed by both the Government and the company and becomes part of the contract

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The Solicitation

Contains numerous clauses that become part of the contract upon award

Certain clauses require responses that must be completed --- READ CAREFULLY

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Commercial Price List

Two copies of your dated (or otherwise identified) commercial pricelist and catalog containing the products you plan to offer must be submitted with your offer

Acceptable forms of pricelists include: published printed, computer generated, and copies of internal pricelists

The products offered must be marked with the Special Item Number (SIN) under which they fall

All other products not offered must be lined out or marked "excluded“, and initialed by offeror.

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Commercial Sales Practice Format(Form CSP-1)

Foundation for contract negotiations Government’s method of assuring “most

favored customer” pricing Vendors are not required to grant GSA most

favored customer pricing --- only fair and reasonable pricing

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Commercial Sales Practice Format(Form CSP-1)

Essential that CSP Format is current, accurate, and complete as of 14 calendar days prior to proposal submission

Must also disclose any changes in your price list(s), discounts and/or discounting policies which occur after the offer is submitted, but before the close of negotiations

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Failure to Provide Current, Accurate and Complete Data

Can lead to penalties under the contract’s Price Adjustment clause

Can lead to penalties under the False Claims Act

Can lead to noncompliance situations with Price Reductions clause during performance

Missed opportunities at negotiations

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Completion of CSP Format

CSP Format information is required for each SIN

Column 1 Column 2 Column 3 Column 4 Column 5

Customer Discount Qty/Volume FOB Term Concessions

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Completion of CSP FormatQuestion 3 ---

IF. . . THEN. . .

Govt price < Best pricePrepare CSP Format for customers receiving the most favored price

Govt price > Best pricePrepare CSP Format for all customers that receive better pricing

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Customer A "customer" is any entity, except the Federal

Government, which acquires supplies or services from the Offeror– Original equipment manufacturers– Value added resellers– State and local governments– Distributors– Educational institutions – Dealers– National accounts– End users

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Discount

“Discount” means a reduction to catalog prices (published or unpublished)– Discounts include, but are not limited to, rebates,

quantity discounts, purchase option credits, and any other terms or conditions other than concessions) which reduce the amount of money a customer ultimately pays for goods or services ordered or received

– Any net price lower than the list price is considered a “discount” by the percentage difference from the list price to the net price

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Concession

“Concession” means a benefit, enhancement or privilege (other than a discount), which either reduces the overall cost of a customer's acquisition or encourages a customer to consummate a purchase– Freight allowance

– Extended warranty

– Extended price guarantees

– Free installation

– Bonus goods

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Price Analysis & Negotiations

Govt’s objective is to obtain an offeror’s best price

Govt price analysis performed to assess price reasonableness and establish Govt negotiation objectives

Purpose of negotiations is to resolve differences between the offeror’s proposal and the Govt’s negotiation objectives

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Conclusion of Negotiations

Contracting Officer will request proposal revision (i.e., BAFO)

The proposal revision confirms the terms and conditions agreed upon between the Government and your authorized negotiator

Reach agreement on the "Basis of Award" category of customer on which the Price Reduction clause will be predicated

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“Basis of Award” Customer

Agreed upon by Contracting Officer and offeror Can be different for each item on price list Can be a single customer or a category of

customers (e.g., National Accounts) For example, if the “Basis of Award” is National

Accounts, and this category is currently receiving a 10% discount; should the offeror increase the discount to this category of customer, then the same discount change shall be passed onto the Government

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Proposal Revisionshould specify, at a minimum. . .

“Basis of Award” class of customer

Date negotiations concluded Discounts or net prices Delivery terms and period Economic Price Adjustment

threshold Geographic coverage Industrial Funding info and

point of contact

Installation, maintenance, or training, etc., as offered

Prompt pay discount Special Item Number(s) Subcontracting Plan info, if

applicable Warranty provisions Acceptance or non-acceptance

of Government purchase cards above the micropurchase threshold

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Upon Award The Contracting Officer may return to the

contractor a copy of the contract and one copy of the catalog/pricelist as accepted by the Government

The contractor may also be furnished with a list of addresses which are to receive a copy of the catalogs/pricelists

The Contracting Officer may also provide instructions for submitting electronic contract pricelist data in a prescribed electronic format

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Managing the Risks After Award

Invest the time and money to comply with the rules, regulations, and contract clauses– Price Reductions (GSAR 552.238-75)– Modifications (GSAR 552.243-72)– Economic Price Adjustments (GSAR 552.216-

70)– Contractor’s Report of Sales (GSAR 552.238-

74)– Industrial Funding Fee (GSAR 552.238-76)

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Report of Sales The Contractor must report the quarterly dollar value (in

U.S. dollars and rounded to the nearest whole dollar) of all sales under the contract by calendar quarter (i.e., January-March, April-June, July-September, and October-December)

The Contractor must report the quarterly dollar value of sales on electronic GSA Form 72A, Contractor's Report of Sales, to the FSS Vendor Support Center (VSC) Website at Internet, http://VSC.gsa.gov The Contractor must report sales separately for each National

Stock Number (NSN), Special Item Number (SIN), or subitem. If no sales occur, the Contractor must show zero on the report for

each separate NSN, SIN, or subitem.

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Report of Sales The Contractor must register with the VSC before using

the automated reporting system – To register, the Contractor (or its authorized representative) must

call the VSC at (703) 305-6235 and provide the necessary information regarding the company, contact name(s), and telephone number(s).

– Registration can also be done at VSC web page - http://VSC.gsa.gov

– The VSC will then issue a 72A specific password and provide other information needed to access the reporting system.

– Instructions for electronic reporting are available at the VSC Website or by calling the above phone number.

Each report is due 30 days following the completion of the reporting period --- a close-out report is due within 120 days after the expiration of the contract

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Industrial Funding Fee

The Contractor must pay the GSA an Industrial Funding Fee (IFF) within 30 days after the end of each quarterly reporting period as established in clause 552.238-74, Contractor's Report of Sales

The IFF equals 1% of total quarterly sales reported --- soon to be .75%

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Industrial Funding Fee

The IFF is a customer paid fee to reimburse GSA for the costs of operating the schedules program.

The contractor is a collection agent for the IFF.

The IFF is included in the award price(s) and reflected in the total amount charged to ordering activities.

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Reporting Requirements

What? Where? When? Who?Affirmative Action (EEO-1)

Contracting Agency

Annually

NLT 3/31

If applicable

IFF GSA Quarterly All

Sales GSA Quarterly All

Subcontracting (SF-294/SF-295)

PCO/ACO & SBA 4/30 & 10/30 If applicable

VETS 100 Dept of Labor Annually

NLT 9/30

All

CCR CCR Annually All

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Post Award Activities

Register for passwords to report sales and

download Schedule Input Program (SIP) software

Prepare and distribute authorized price list

Prepare and upload SIP data files

Meet with Industrial Operations Analyst (IOA)

Perform contract administrative actions

Market, market, market, market, market!

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Marketing Tips Distribute GSA approved price list Load contract to GSA Advantage! Maximize your web presence --- GSA logo identifiers Links between your website and GSA Advantage! Advertise, market, and promote your new GSA schedule contract Modify your company business cards to prominently reflect your

new GSA affiliation Enter into teaming arrangements Look for Blanket Purchase Agreement opportunities Understand and comply with the terms and conditions of the FSS

program and your contract

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Marketing Approaches

Market to prospective government customers using the same mediums you use to reach commercial customers, including . . .

Print Trade shows Web Sales calls Network Any and all other ways!

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Marketing Approaches con’t.

Market to prospective government customers using GSA related vehicles, including . . .

Print - MarkeTips - special publications, e.g., Environmental Products and Services Guide (EPSG)

Trade shows - GSA Expo and Outreach Europe - PSX Expo Web - GSA Advantage! - acquisition center databases

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Marketing Approaches con’t.

Work at both you finding customers and customers finding you . . .

Maintain profiles in CCR and PRO-Net Monitor FEDBIZOPPS, DODBUSOPPS et al Research past sales activity in Schedule Sales Query

(SSQ) and Federal Procurement Data System (FPDS)

Develop and communicate “Best Value” criteria Think “out of the box” to find prospective

customers who need your products/services

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Before you get started. . . Answer the following. . .

Do you have the expertise to administer a Government contract?

Do you have the discipline to comply with the requirements of a Government contract?

Are you willing to spend time and money at the outset to ensure compliance during performance?

Are you willing to create the infrastructure to ensure compliance?

If so, then GSA FSS contracts can be a great source for additional revenue.