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GSA schedule sales continue to slide

GSA must prove itself as 'America's buyer,' top official says

Jul. 31, 2013 - 06:00AM   |  
By JIM McELHATTON   |   Comments
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GSA's Tom Sharpe says the agency needs to convince other agencies that it offers better prices and faster procurement through its supply schedules sales. (Mike Morones/Staff)
GSA's Tom Sharpe says the agency needs to convince other agencies that it offers better prices and faster procurement through its supply schedules sales. / Mike Morones/Staff

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When Tom Sharpe oversaw procurement policy at the Treasury Department, his agency used the General Services Administration supply schedules about as much as most other departments across government do — which, if you ask top GSA officials, isn’t nearly enough.

Last year, about 12 percent of federal procurement dollars that could have gone through GSA actually did. Now, GSA officials say they’re expecting to hit 17 percent by the end of the year. What’s more, they’ve made it clear they’re aiming to hit the 90 percent mark within a decade.

In the face of such lofty goals, GSA schedule sales dipped in 2012 for the second year in a row — 2.9 percent from 2011 and a total 3.5 percent from 2010, according to data compiled for Federal Times by market research firm Deltek.

And how the figures hold up against the sequester is anyone’s guess.

The optimistic view is that agencies that have relied little on GSA will turn more to the agency in search of cost savings to buy goods and services with the sequester clamping down on their budgets.

“They’ll definitely take a second look, but whether they do anything is hard to say,” said Pierre Bernasconi, principal consultant at Deltek’s GovWin Consulting.

On the other hand, he said, the sequester could continue to erode agency spending in areas such as information technology, office supplies and furniture, the sort of goods and products that make up many of GSA’s schedule offerings.

“Things aren’t looking too rosy for 2014,” Bernasconi said. “The House and Senate are on different planets.”

Sharpe, who in February became commissioner for GSA’s Federal Acquisition Service, finds himself as the official in charge of getting agencies to increasingly turn to GSA at a time when procurement dollars are in short supply. Three decades after he began his procurement career as an intern at an Army depot in northeastern Pennsylvania, Sharpe could find boosting schedule sales to be the challenge of his career.

Before he was named FAS commissioner, Sharpe had served as Treasury’s senior procurement executive, overseeing billions of dollars in contract spending.

When asked how he viewed GSA in his old job, Sharpe said he knew GSA was faster, just not how fast. Now, he views GSA as the key agency to help reduce duplication across government.

If agencies would use their own procurement shops less and turn more to the GSA, that would help reduce duplication, Sharpe said. And GSA needs to convince agencies that it offers better prices and faster procurement outcomes.

“A suggestion would be that we as a government acknowledge that we need to be more efficient and effective at federal procurement,” Sharpe said. “I think one way to do that would be to take on an initiative, a metric to reduce the number of contract actions we do. Whatever the percentage reduction would be we can go ahead and discuss and debate.”

Ultimately, Sharpe said the plan would be to drive contract actions to certain contract vehicles that are proven performers.

“In other words, drive and increase volume to preferred vehicles that we’ve already demonstrated are in the best interests of the taxpayers and these agencies.”

GSA officials are taking the same sales pitch to agencies and Capitol Hill. Based on an analysis of average contracting time frames from more than 15 agencies, using GSA’s schedules is up to 50 percent faster for an agency compared with “presenting their own, often duplicative, solution,” GSA Administrator Dan Tangherlini told a Senate panel last month.

But others see value in having lots of competition between GSA and other federal agencies that have their own governmentwide acquisition contracts (GWACs) offering products and services to other agencies.

Steven Kelman, a professor at Harvard University who served as the administrator for the Office of Federal Procurement Policy from 1993 to 1997, said as much during a discussion touching on GWACs at the National Contract Management Association conference last month in Nashville, Tenn.

“I like the idea of the potential of leveraging government buying power through these larger contracts,” Kelman said. “And I like the idea of competition within the government between GSA and a few GWAC holders.”

GSA monopolies, Kelman said, aren’t good for the government or for taxpayers.

Sharpe isn’t talking monopolies. But he is intent on increasing GSA’s market share. And he said the view that GSA holds of itself as “America’s buyer” is something the agency needs to prove.

“I’m focused on faster process, best prices possible and a high level of small-business participation,” Sharpe said.

Tangherlini told lawmakers he sees opportunity for GSA amid the sequester.

“Right now, as budgets tighten across the federal government, the [GSA] is uniquely positioned to support our partner agencies so that they can focus their energy and funding on their own important missions,” Tangherlini told the Senate Homeland Security Committee on July 15.

Meanwhile, however, GSA schedule sales dipped last year.

“In some cases, I think companies took market share from each other,” Bernasconi said.

“In most of the growth instances, I also think companies have gotten better at marketing their schedule offering and selling through the vehicle,” he said.

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