As a follow-up to Aronson’s webinar on “Significant Changes Impacting GSA Schedule Holders,” Aronson LLC government contracting specialists Wade Prince and Vanessa Payne have prepared answers to several attendee questions:
How does Mass Mod A382 affect parts without manufacturer’s part numbers, non-standardized fixed-price services and labor categories?
Mod A382 is meant to enforce the requirement that Manufacturer’s part numbers are included in GSA Schedule Vendor Price Lists. The purpose is to make it easier for Government Buyers to search and compare pricing among multiple Schedule-holders that provide the same standard products, ancillary products, or fixed-price services. Since any changes to part numbers could disrupt search results, the announcement email warns “do NOT add your own prefixes or suffixes to the manufacturer part numbers.” GSA also instructs that “Industry partners should make a best effort to obtain accurate product information” but if there is no part number associated with a product then it should not be created by the Contractor. The goal is to ensure that Vendor price lists only include “Manufacturer’s Part Number as submitted to the vendor by the manufacturer, and as presented by the contract holder to GSA.” Likewise, Mass Mod A382 does not include a requirement for contractors to standardize their fixed-price services. A follow-on notice regarding Mass Mod A382 announced that it was postponed but would be issued by the end of June.
On July 24, 2014 GSA sent out an email entitled “Improving Product Number Data Quality on GSA Schedules.” While NOT an official Mass Mod notice, the email requested that “contractors who primarily offer products … help to improve the integrity of your schedule offerings by submitting Universal Product Codes (UPC) and Manufacturer Part Number (MPN) for each awarded contract item.” It also listed the advantages Contractors could potentially yield and warned of the requirements of clause I-FSS-600 that “… price lists (catalog files) must be complete and include all supplies, prices, and terms and conditions that were accepted by the Government at award and should include accurate product descriptive data.” The notice closes with the request “Please upload all base product contract line items with UPC and MPN to GSA Advantage via SIP within 90 days.” Included was this link to an FAQ about the subject: https://vsc.gsa.gov/FAQ/ProdNumQualityGSASched.pdf
The standardization of labor categories has also been mentioned as a goal at GSA for quite some time, including in a recent blog post by Tom Sharpe, Commissioner of the Federal Acquisition Service (FAS), (http://gsablogs.gsa.gov/gsablog/2014/06/12/modernizing-gsas-schedules-program-for-todays-marketplace). He notes, “We’re beginning our work with stakeholders and services contractors to figure out the best approach to standardize labor categories for services, and we’ll determine what makes sense with their input.” To date there has been no discussion of a time frame for any sort of roll out of standardization of labor categories for services. Of course, Aronson will continue to follow this matter closely.
What is the impact of a GSA Schedule contract cancellation or expiration, initiated by either the Vendor or Government, on new GSA Schedule contracts in the future?
For a two-year period, cancellation letters for previously-awarded Schedule contracts and Rejections notices for previously-submitted Schedule offers, for any Schedule (even Schedule types other than the new offer) must be disclosed with any new offer.
For a 12-month period, GSA Solicitation offer submission instructions state, “If the Offeror was previously awarded a Schedule contract that was cancelled or allowed to expire due to low or no sales, a new offer for the same Schedule will not be considered unless a minimum of 12 months have passed since the effective date of the cancellation or the expiration date of the previous contract. Any offer submitted prior to the completion of this 12-month period will be rejected.” (SCP-FSS-001 Instructions Applicable To All Offerors (Mar 2014))
The following requirements have no time limit and pertain to new offers if a contract was previously awarded under the same Schedule, and it was subsequently cancelled or allowed to expire due to low sales. New offers for the same Schedule must include a detailed description of the steps the Offeror plans to take to generate sales through a new contract that includes the following: (1) A copy of the cancellation letter or notification of determination not to exercise an option, (2) Current federal sales in excess of $25,000, as evidenced by copies of contractual documents that identify the federal entity and the date and value of the product or services provided, (3) Demonstrate that there is a reasonable expectation that any future award will comply with Clause I-FSS-639, Contract Sales Criteria, (4) Provide a marketing plan detailing the steps you plan to take to generate sales through a new GSA Schedule contract. (SCP-FSS-001 Instructions Applicable To All Offerors (Mar 2014))
Can you provide information on Reverse Auctions and its use in context to the GSA Schedules?
GSA’s reverse auction platform, reverseauctions.gsa.gov launched on July 1, 2013 for select GSA multiple award schedules and blanket purchase agreements. Federal agencies (Buyers) hope to generate lower prices on non-complex commodities and simple services via reverse auctions as Sellers/Vendors successively bid prices down on auctions released by Buyers until the auction time ends. No fees are associated with use of the Reverse Auction platform, use is covered under the IFF already paid.
The decision to use reverse auctions instead of other procurement vehicles or platforms such as GSA eBuy or Multiple Award Contracts, is at the contracting officer’s (Buyer’s) discretion – the same opportunity should not be placed on both GSA eBuy and GSA Reverse Auctions. Sellers/Vendors must have a GSA Schedule to participate in the GSA Reverse Auction platform and can only see auctions under their awarded Schedule(s) and SIN(s) and may only quote on items which are already on their GSA Schedule prior to Solicitation/Auction closing date (same requirements as GSA eBuy).
The reverse auction process is used to solicit quotes for products and simple services not requiring a statement of work under FAR 8.405-1 and may be used for pricing when buying services under FAR 8.405-2. It allows Buyers to obtain discounts off of established GSA Schedule prices and helps contracting officers comply with the requirement to seek a discount for orders exceeding the Simplified Acquisition Threshold (SAT). Buyers must utilize FAR 8.405-1 or 8.405-2 when placing orders against GSA Schedules via reverse auctions. For more information see our previous blog post here.
What is the status of the transition from Administrative Contracting Officers (ACO) to Industrial Operations Analyst (IOA)?
GSA announced that in March 2014 the Industrial Operations Analyst (IOAs) would assume from the Administrative Contracting Officer (ACOs) all non-contracting responsibilities regarding sales reporting and remittance of the Industrial Funding Fee (IFF). The change is intended to provide vendors with one GSA contact for contractor compliance assessments, visits, and reports and follow-on sales adjustments and any matters related to IFF reporting. In reality the transition may still be in process, however vendors still should consider the IOA to be their first and main point of contact regarding sales reporting, IFF remittance, and compliance assessments/visits. In the near future, GSA will have an IOA locator posted on the Vendor Support Center website (similar to the existing ACO locator) to help identify the IOA assigned to the contract. In the meantime, vendors can reference the IOA contact information provided with their last Contractor Assistance Visit or upcoming Quarterly Sales reminder emails which will now include the IOA’s contact information.
Regarding disclosure of Commercial Sales Practices (CSP) in the GSA eMod system, do we have to determine a new Most Favored Customer (MFC) with each change or only check the existing MFC-GSA price-discount relationship? Can you explain again about discounting at line item (labor category or product) level?
For any modification request that affects the Commercial Sales Practices (CSP) – Add, Delete, Pricing modifications – the GSA eMod system will have a question asking if there are changes to the CSP. At a minimum you must provide at least the commercial sales practices data for the modification change that you are making (e.g. for an Add mod, at a minimum you must provide the data for the new item you are adding; for a Pricing mod you have the option to update the CSP if your request may change items listed on the current CSP). If no changes are necessary, then the system will allow you to complete the modification. If changes to the CSP are required, add your data. Note: Even if not required by GSA eMod, some Schedules (such as LOGWORLD, MOBIS, PES, Consolidated, Environmental, and Language) may require completion of the entire CSP and an accompanying Proposal Price List (PPL) for all Add/Delete/Pricing modification requests. See Schedule-specific modification requirements for details.
Updating your CSP (entire, selected SINs, or selected line items) requires review of commercial sales of products /services comparable to those on your GSA Schedule to determine whether the previously disclosed MFC still receives your best price (most favored pricing) or if a new customer or class of customers has begun to receive your best pricing. Changes in your sales practices including changes to the Most Favored Customer, Class of Customer, and/or price-discount ratio must be disclosed on the CSP. Upon review of your changed CSP your GSA Contracting Officer may elect to keep your existing MFC and discount relationship or to negotiate a new MFC and discount relationship.
When completing the CSP in eMod, discount policies can be entered at the Schedule level (e.g. “10% off commercial price list”) or SIN level (e.g. “SIN 874-1: 5% better than MFC prices” and “SIN 874-7: 10% better than MFC prices”). eMod cannot accept data at the line item (labor category or product) level. If discounts vary by line item (by labor category or by product) data must be completed at the SIN level in eMod with a note (e.g. “SIN 132-33: GSA discount varies by product/line item, 3%-14%, see attached”) – and a separate spreadsheet, such as the Proposal Price List (PPL), indicating the discounts by line item should be attached/uploaded in eMod under “other vendor defined.”
Remember, depending on the Schedule-specific requirements, your modification submission must include a statement that you certify your information is current, accurate, and complete or that you understand all commercial business practices have been fully disclosed.
Do sales to state and local governments trigger the price reduction clause?
They could. Sales to state/local governments (not through a Schedule contract; see note 1) are considered by GSA to be “commercial sales.” Commercial sales are generally subject to GSAR clause 552.238-75, Price Reductions which states that any change in the contractor’s commercial pricing or discount arrangement applicable to the identified customer or category of customers (BOA) which disturbs the agreed upon pricing relationship shall constitute a price reduction.
If your Most Favored Customer or Basis of Award discount-relationship includes state/local governments (e.g. All Commercial Customers, Commercial End Users, State/Local Governments), then yes, lowering your prices to state/local governments may trigger the price reductions clause. If your BOA/MFC does not include state/local governments (e.g. National/Corporate Accounts), then a reduced price to state/local governments may trigger the need to disclose a new commercial sales practice (CSP) but not a price reduction. Upon review of your changed CSP your GSA Contracting Officer may elect to keep your existing Most Favored Customer (MFC) and discount relationship or to negotiate a new MFC and discount relationship. Failure to disclose a new commercial sales practice may be viewed in hindsight as price reductions.
Note 1: There shall be no price reduction for sales to Federal Agencies and Eligible Users of GSA Sources of Supply and Services (GSA Order ADM 4800.2H), including sales made to state and local government entities when the order is placed under a Schedule contract. See GSA state and local government purchasing programs including Disaster Recovery and Cooperative Purchasing.
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