Are schedule prices a good deal?

The Multiple Award Schedule Advisory Panel discovered its mission last week. Meeting for the fourth time, the panel narrowed its attention to five areas.

The panel will focus on stakeholders’ views of the schedules program, their expectations, the program’s business model, pricing policies and whether companies in the program offer agencies the same price they would offer their most-favored commercial customers.

The overarching question facing the panel is whether General Services Administration contracts offer agencies the lowest price, said Elliott Branch, the panel’s chairman and executive director of contracts at the Naval Sea Systems Command. If customers are not confident they are getting the lowest prices from schedule contracts, the tools GSA uses to keep prices low — primarily the price-reduction clause — is not having the needed effect and should be stripped away, Branch said.

Some customer agencies use GSA schedule prices as a starting point for further negotiations. For that reason, Tom Sharpe Jr., senior procurement executive at the Treasury Department, said he has no confidence in GSA’s prices.

Jacqueline Jones, branch chief and contracting officer at GSA, said the price-reduction clause guarantees that GSA gets the best prices compared with a company’s most-favored customer. Sales, which officials say are on the upswing, indicate the schedules have good prices, she added.

Bruce Leinster, an IBM consultant and member of the Information Technology Association of America’s procurement policy committee, told the advisory panel that if companies compete for task orders, the price-reduction clause is unnecessary.

About the Author

Matthew Weigelt is a freelance journalist who writes about acquisition and procurement.

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