GSA details auction plan

• By Colleen O'Hara
• Mar 26, 2000

Online auctions and so-called reverse auctions that allow multiple users to aggregate buys to get lower prices are all the rage in the private sector. The General Services Administration plans to test the online auction waters beginning next month, but it will have to convince vendors and users that it's a good move for government.

GSA detailed to vendors this month its plans to create its buyers.gov site, which GSA hopes will make it easier for government agencies to buy information technology products. The site initially will offer three approaches to selling computer hardware and software to agencies:

* A private buyer auction in which an agency would post a solicitation for IT commodities and vendors would respond with quotes.

* A reverse auction, known as eFast volume purchasing, that would allow multiple agencies interested in buying the same product to pool their orders into a single large buy to drive down the price.

* QuickQuotes, which offers the services of an electronic store to buyers who want to shop for a specific IT commodity.

GSA plans to use the existing services of a few vendors, including ACS Government Solutions Group Inc., which recently teamed with SupplierMarket.com and VolumeBuy Inc. to develop a reverse auction site for government users. Mercata Inc. and FreeMarkets Inc. also offer similar services.

Vendors that participate in the eFast reverse auction most likely will have a GSA schedule or existing government contract, said Manny DeVera, director of GSA's Federal Technology Service IT Solutions Regional Services Center. But vendors that participate in the private auction do not have to have a government contract, he said. "We hope now is the right time to leverage the government's buying power to get good pricing and to allow resellers to gain efficiencies in their cost of marketing," DeVera said.

The approach should also benefit GSA, which spends a lot of time buying commodities that involve expensive, labor-intensive transactions, DeVera said. The buyers.gov site would simplify and automate the process, he said.

"We feel the biggest challenge is encouraging buyers to feel comfortable with this," DeVera said.

Others seem to agree. "The concern is that [agencies] may end up with substandard goods from companies they know little about. I think it will be in the end a very limited utility as an acquisition method," said Larry Allen, executive director of the Coalition for Government Procurement.

Chip Mather, senior vice president of Acquisition Solutions Inc., Chantilly, Va., said users might get better prices and faster service from an existing blanket purchase agreement or an indefinite-delivery, indefinite-quantity contract — particularly if an agency knows exactly what it wants.