Happy New Fiscal Year! As you know, we’ve been working on a number of transformative changes to Multiple Award Schedules, and it looks like the collaboration between our FAS COs (Contracting Officers), federal customers, and industry partners is starting to pay off. I’m pleased to report that after a small usage dip in previous years, the $33 billion dollar MAS program showed real growth in FY2015.
While this is great news, and I am thrilled with the hard work that has led to this success, let’s be clear: we’re nowhere near done making improvements to this program. I want to continue to grow the MAS program to benefit all GSA partners.
As I mentioned in my last blog, one big change to the MAS program is the Competitive Pricing Initiative (CPI), fueled by a Horizontal Pricing Analysis Tool that examines the current prices of identical products offered by suppliers through the MAS program. This allows COs to identify prices that are outside of a competitive range. Once outlier prices are identified, COs and Schedule holders work together, identifying which items and prices might be adjusted to make them more competitive in the federal market. While having the conversation, the vendor can also let GSA know if they have a unique value proposition such as speedier deliveries, guarantees, or quantity, that warrants a price outside of the competitive range. By working with contractors to bring all offered prices into a competitive range, GSA and our industry partners ensure that MAS continues to be a competitive and widely-used program for faster, easier, and less costly FAR- compliant purchases. Our goal is that this important work will ensure that MAS remains the go-to purchasing vehicle of choice for both industry and government.
As of today, the Competitive Pricing Initiative has resulted in approximately 1.4 million price reductions on MAS — direct savings passed on to GSA Advantage shoppers. That’s good for the government, good for our customers, helpful to our industry partners, and nothing short of great for the American Taxpayer.
Steven Yudis from Capp, Inc. a small business owner who reduced prices on more than 30,000 line items and saw sales double, said “I cannot begin to tell you how successful this initiative was. And we are experiencing much of the same growth through the Department of Defense eMall as well.” I can’t think of a better example of how the Competitive Pricing Initiative is a win-win situation: a small business makes good use of the pricing analysis provided to them by GSA and uses that valuable market intelligence to improve their competitive position. The results speak for themselves: better pricing for the government and increased sales for the contractor.
Our vendors also report the CPI helps them fine tune their offerings, allowing them to eliminate items that were no longer relevant, while also ensuring that contracts are in line with their company’s current business strategy. One vendor found 150 obsolete items in their catalog during a review and later reached out to say they “look forward to continuing to support GSA’s customers by providing them with great service and excellent prices.”
Another contractor used our intelligence to take advantage of both opportunities: ”in order to remain competitive” they deleted 21 items no longer serving a valuable purpose from the contract, while also lowering prices on 215 items.
These are just a few of the many encouraging responses we’ve heard as we work to tackle pricing issues on MAS. But, as I’ve stated before, the Competitive Pricing Initiative is not just about dollars — it’s also an opportunity to impart more knowledge and foster better and more collaborative relationships between our COs and the vendor community.
I want to thank everyone who’s worked so hard on this initiative, both from the Industry side as well as the hundreds of MAS contracting officers. The MAS program would not, and cannot, be successful without your continued dedication to its success. I look forward to updating you all in the coming months on our progress with the myriad other transformational initiatives as we begin a new Fiscal Year and continue to secure the MAS program as the fastest, easiest, and most least costly government acquisition program.