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What’s new in the federal market

October 01, 2018

What’s new in the federal market

If you sell to the federal market, it’s important to stay abreast of the latest regulatory and policy changes that can directly affect your business. Yet when deadlines and task orders keep you too busy to think, it’s often tough to stay informed.

In this blog, we’re making it easier by bringing updates to you. During a recent conversation with Roger Waldron, president of the Coalition for Government Procurement, we learned about several recent changes that may affect agencies’ purchasing patterns—and also a few trends to watch.  

What’s happening now

GSA added order-level materials (OLM) to their Schedule 70 contracts
Considered a game-changer for contract suppliers, GSA has increased flexibility at the task order level by adding OLMs to Schedule 70 contracts. If a federal agency requests a product or service that’s not specifically listed and priced on the existing contract, solution providers can now include that item as an OLM as part of the response to that statement of work (SOW) task order. In the past, adding a new product or service required either negotiating the existing contract (a challenging process) or teaming with someone else on their Schedule 70 contract. Otherwise, you were out of luck. 

What does it mean for you?  This new flexibility enhances the value of schedules for customer agencies, as well as for schedule contractors. You may have greater opportunities to provide OLM capabilities, if necessary (up to one-third of the contract value), to meet specific SOW requirements. Curious to learn more? Check out two of Waldron’s blogs: Grand Slam for the Schedules and OLMs: Continuing the Momentum.

The push for category management continues through best-in-class contracts
The federal government, led by the Category Management Leadership Council, continues its mission to help agencies “buy smarter” and function more like a single enterprise, which can lead to big savings, better efficiencies and improved performance. One of their key initiatives is “best in class contracting,” which aims to reduce contract duplication by encouraging agencies to only use the most efficient ones. Currently, there are 33 contacts identified as “best in class” (like the NASA SEWP contract), and agencies are being urged to consider these first before creating or using other contract vehicles. The GSA is currently working hard to join this list, which will likely happen in the near future. 

What does this mean for you?  By knowing which contracts are “best in class,” you can work toward getting on those contracts and getting a leg up on more business. It can also give you information on your competition, and may open up opportunities for partnerships with other suppliers. 

What’s on the horizon

According to Waldron, several trends are worth watching in the months ahead:

Coming soon: federal e-commerce platform

A new legislation, Section 846 in last year’s National Defense Authorization Act (NDAA), gave GSA the responsibility to establish a government-wide acquisition program using e-commerce platforms. The GSA finished the framework in March 2018, and is now in a 12-month process of conducting market research with stakeholders (e.g., customer agencies, suppliers and e-commerce suppliers) to understand how e-commerce works and craft a vision for the new government marketplace. Starting in March 2019, they’ll embark on a year-long process to write the regulations, with a goal to launch a pilot program by the following fiscal year. There’s current debate about whether IT solutions would be included in the e-commerce marketplace, due to concern about counterfeit products and the risk of the supply chain risk for cyber solutions.

Trending: more supply chain prohibitions

For example, in the 2019 NDAA (Section 889), certain mandates restrict the federal government from purchasing telecommunications and video surveillance products and components from specific foreign suppliers (e.g., Huawei, ZTE and other Chinese companies), due to cybersecurity risks that could compromise government networks. 

In another example (NDAA Section 1655), the Department of Defense is prohibited from buying specific IT solutions unless the system provider discloses whether the source code has been reviewed or accessed by foreign governments in certain countries of concern. According to Waldron, more rules of this nature will likely emerge. 

Discussion: creation of a federal acquisition security council

There’s already discussion on Capitol Hill about forming a council to create and manage regulations around federal acquisition security. Certain provisions already exist to create a critical IT supply chain risk evaluation board, and similar regulations may be forthcoming. These councils would be responsible for assessing the market, identifying companies and products that create a potential supply chain risk for the federal government, and making decisions about prohibited suppliers. Over the next year, expect to see more new developments in IT supply chain risk.

To help you succeed in the federal market, Ingram Micro maintains relationships with expert resources, such as the Coalition for Government Procurement and Sheppard Mullin Compliance Attorneys.