Can government do e-commerce?

Congress mandated that the government give federal buyers an Amazon.com-style shopping experience, but it's not as easy as it looks.

Shutterstock ID 169474442 By Maxx-Studio
 

The 2018 National Defense Authorization Act called for the creation of an Amazon.com-like portal for federal buyers, which put the General Services Administration on a tight schedule to develop and test such a platform. GSA plans an initial pilot of the system in late 2019 with a limited number of agency participants.

The agency recently hosted a town-hall style meeting with industry and stakeholders and also fielded two requests for information to delve into the details of how algorithmically driven e-commerce platforms can intersect with the highly regulated world of federal procurement.

"It's a tough task, but GSA is serious about it," said one acquisition expert close to the effort.

In the first phase of developing the platform, the Office of Management and Budget and GSA anticipated some of the big changes that would have to be made to accommodate a federal e-commerce portal. They asked Congress to increase federal agencies' micropurchase threshold to $25,000 from $10,000 and to allow GSA to modernize certain competition requirements.

The RFIs are seeking input on how platforms and sellers can comply with mandates requiring participation from veteran-owned, minority-owned and women-owned businesses, how to deal with third-party and transactional data and how to address cybersecurity for the supply chain.

Asking so many questions up front may be biting off too much, procurement industry expert Larry Allen said. He advocated GSA take a more agile contracting approach, "taking its top seven or eight" issues, working those out then moving on to more.

"They're asking good questions, but GSA has a tendency to try and get all the answers up front in the RFI, then move on to the RFP," Allen said.

Roger Waldron, who heads the trade group Coalition for Government Procurement, said potential competition between established GSA schedules and new e-commerce platforms could pose a problem for vendors who already spend money and time to list products and services on multiple programs.  The portal would be yet another, he said.

"The meeting and RFIs reflect the opportunities and complexities of Section 846," Waldron told FCW. "Government has come a long way in understanding markets, but still has a long way to go."

Allen was optimistic about GSA's ability to implement a compliance overlay that would allow it to more quickly comply with federal law and government set-aside programs.

"It's doable," said Allen, but added that it will depend on GSA's ability to identify and target compliance areas in the buying process. "Obviously software filters exist," as companies such as Amazon, Overstock.com and others use them to hone their offerings, he said.

However, said the contracting official, the trick for GSA will be how to get technology sellers to go to the trouble of implementing that potentially costly and time-consuming overlay.

Michael Price, manager of MarketUS, a small business advisor specializing in federal government contracting, said that the proposed $25,000 micropurchase threshold could be a disincentive for small businesses to seek placement on government purchasing schedules.

GSA officials said during the industry day that they need all the input they can get from vendors on how things work. The RFIs and numerous one-on-one advisory meetings with e-commerce providers, they said, are efforts to expand their understanding about how the commercial market works and how technology and strategies can be adapted to the federal market.

That won't happen immediately, however. Experts said the 2019 pilot will most likely start on a very small scale and be limited to commodity office products, only later expanding to more complex IT offerings.

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