A hot topic in government procurement today is GSA’s establishment of an e-commerce model for purchases. If you’re a solution provider serving government agencies, this new approach could affect you.
During a recent conversation with Roger Waldron, president of the Coalition for Government Procurement
, we learned where the e-commerce initiative stands today and what you can expect in the months ahead.
For those who don’t know, what is the e-commerce initiative?
New legislation introduced in 2018 (Section 846 of the 2018 National Defense Authorization Act) requires the General Services Administration (GSA) to establish commercial e-commerce portals to modernize the government’s purchase of commercial off-the-shelf (COTS) products. The idea is to streamline and simplify the buying experience for government purchasers by taking advantage of e-commerce capabilities. The immediate goal is for GSA to have an initial e-commerce pilot rollout by the end of 2019.
What milestones have already been met?
The first step was to write an implementation plan, which was completed in March 2018. Next, GSA spent a full year conducting market research, meeting with e-commerce portal providers and talking to government buyers and the supplier community. Based on that work, GSA released its Market Research and Consultation Report last month. The report is significant because it outlines a blueprint for implementation by the GSA and the Office of Management and Budget (OMB), which is the next step.
What did we learn from the new report?
GSA will start by conducting a proof of concept to evaluate its proposed e-commerce approach. We also learned that GSA’s selected approach is to use an e-marketplace portal (like Amazon), which is one of three e-commerce models that meet the broad statutory definition set forth by Congress. Significantly, at the portal level, the e-marketplace portal is the least competitive of the three e-commerce options (which also raises concerns by some about lack of competition among portal providers).
What will we be seeing next?
GSA plans to issue the proof of concept solicitation by the end of June and hopes to award a contract by the end of 2019. As part of the proof of concept, the GSA also seeking legislation to implement a five-year pilot program increasing the purchase threshold from $10,000 to $25,000. The next step will be to contract with a chosen provider and begin the proof of concept, with the goal of eventually establishing a channel for e-commerce that government buyers can use for repetitive purchases.
Is there information we still don’t know?
Yes. Based on what we saw in the report, we also know what wasn’t
in it—specifically, how GSA plans to address issues related to supplier chain risk and cybersecurity. That’s an important point that wasn’t addressed. Pricing wasn’t addressed either, nor was it identified in the report as a performance measure for the proof of concept. That’s significant because two recent studies comparing GSA Schedule contract pricing to Amazon pricing concluded that GSA pricing was significantly better. Finally, the recent report didn’t explicitly indicate whether IT and healthcare products would be eligible for purchase in the new e-commerce model.
How can government resellers prepare?
I would encourage government resellers to read the recent GSA Market Report and also take a close look at the draft solicitation for the proof of concept when it comes out. If you have questions, comments or feedback, don’t hesitate to submit those directly to GSA. You can also follow my weekly blog
, which follows this and other government procurement topics closely.
To learn more about how Ingram Micro can help you navigate changes in the federal government procurement landscape, contact the public sector team today.