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GSA Schedule contract

Scared of the CAV or IOA?

Is your GSA Schedule in good health? The government ensures that your GSA Schedule stays sound by performing occasional audits, checking that your business is following the rules under which the contract was awarded. While you may have the best intentions of remaining in compliance, new hires, misunderstandings about regulatory requirements, and price changes can trip you up, causing problems in the audit itself.

EZGSA offers a Schedule Check-Up that helps to prevent negative audit findings. Many of our clients utilize this service once a year, just as you get a physical once a year — as an objective view of your GSA Schedule’s soundness.

In the GSA Schedule Check-Up, we review:

  • invoices;
  • sales to your Most Favored Customer;
  • sales to all government agencies;
  • internal Commercial Sales Practices procedures;
  • 72A reporting and payments; and
  • open market sales.

If discrepancies are found, we assist you in correcting the problems as well as developing new procedures that will prevent replication of the problems.

Contact us at 301-913-5000 or sales@ezgsa.com to see if your business can benefit from a Schedule Check-Up, either as a yearly preventative or before the Auditor visits.

Marketing Tip of the week: Expiring Contracts

When a government contract ends, there is a likelihood that the particular agency will again need the things they bought before. Like a yearly grocery list, they buy the same types of things over and over again.

Knowing contract end dates are essential to winning new business. By researching for existing contracts that will be expiring in the next 6 months, you’ll be able to determine:

  • the status of the current project
  • if it’s going to be up for “re-compete”
  • what the incumbent did to win the original
  • the likely parameters of the forthcoming RFP
  • the strengths and weaknesses of your competition

—and you’ll have this information well in advance of the RFP, giving your team ample time to prepare .

For more information or for research and marketing assistance, call EZGSA @301-913-5000

Need-to-Know Tidbits About Schedule 65IIA

In trying to modify a client’s GSA Schedule 65IIA, we have had to deal with some changes in the solicitation and wanted to make you all aware of potential problems.

First, Contracting Officers are no longer allowing distributors to provide Letters of Supply and now require all such letters to originate from the manufacturer only.

Secondly, the solicitation now requires that the facilities where all devices are manufactured be registered with the U.S. Food and Drug Administration.

This has proven troublesome for resellers on the Schedule, especially those who have previously honored agreements with manufacturers that now balk at this extra level of administrative oversight.

If you have questions or need help dealing with an issue such as this, contact us at admin@ezgsa.com or 301-913-5000.

GSA’s TDR rule changes EVERYTHING

Just over a month ago, GSA published the final Transactional Data Reporting (TDR) rule designed to expunge the Pride Reduction Clause (PRC), Most Favored Customer (MFC), and the Commercial Sales Practices. Starting 22 August, new Schedule awardees whose contract is part of the pilot roll-out will be evaluated against the TDR. Existing contract holders will be allowed to opt in, but it is a voluntary, bi-lateral move.

According to GSA, “This rule asks contractors to electronically report key procurement data; including prices paid, quantity, standard part number and product description for all purchases through GSA contract vehicles. The information collected through the TDR will help contracting officers make smarter purchasing decisions and provide data to assist in negotiating future contracts.”

The upside for vendors taking on this additional burden is that they will be spared from having to worry about violating the PRC, which states that if your commercial MFC price drops below the basis of award rates, an automatic price reduction is triggered. Failing to implement this price reduction may subject the vendor to the False Claims Act, under which they can be sued for fraud. This had been one of the leading complaints from contractors. And while there are new concerns accompanying this rule, it does seek to address a the difficulty of maintaining pricing compliance.

The TDR will require an entirely new way of dealing with GSA pricing and has some significant future effects. EZGSA is developing a white paper concerning the TDR and will post it’s link here in the next week.

Pricing Your Pricing in Your Proposal

Pricing can be the biggest stumbling block for businesses applying for GSA schedule contracts. The notion that the government expects the absolute lowest price in the world, plus the fear of triggering the Price Reduction Clause, lead some to conclude that it’s just not worth the hassle and risk for such low margins.

It is tempting to automatically set your price as low as possible, especially when selling products. Here are three pieces of information that may cause you to reconsider how to structure your GSA Schedule pricing proposal.

Similar Terms, Quantities, and Conditions

The misunderstanding out there is that you need to give GSA the lowest price you’ve given anyone. The truth is that you need to give GSA the lowest price you’ve given to anyone with similar terms, quantities, and conditions.

This is a big difference. Let’s imagine that you give your distributer a 40 percent discount, but only on purchases over $250,000; this distributer takes the risk holding high volumes of your product, promotes and sells your product, represents your brand, and has their cousin Jeff drive down to the warehouse monthly to save on shipping. The government may want that 40 percent discount, but because the terms, conditions, and quantities are not similar, should they actually get it?

If you can establish that the federal government is more similar to a customer that gets a lower discount, you may be able to establish a higher GSA ceiling price.

GSA is going to negotiate during your proposal process

Before your Final Proposal Revisions are signed, your GSA Contracting Officer is going to negotiate. A CO may take the stance that your items are too expensive, no matter how slim the margins. Your company can do better.

COs are required to push that discount rate as high as possible so they can get the best deal for the government, and ergo the taxpayer. S/he will most likely push back on your proffered discount rates. If these rates are already at your limit, you may not be able to successfully negotiate during the proposal process.

Purchasing agencies are required to ask for additional discounts

Your GSA price is a ceiling price, meaning you can’t charge the government a higher rate. But you can always go lower.

“The GSA Schedule CO determines the prices of supplies and fixed-price services, and rates for services offered at hourly rates, to be fair and reasonable prior to contract award. However, ordering activities are always encouraged – and, in some cases, required – to seek additional discounts (i.e., price reductions) prior to award of Schedule orders and Blanket Purchase Agreements (BPAs).”

In order to be competitive, it may behoove you to keep prices high. You may then have room to discount individual orders from agencies.