This week’s blog is the third in a series focusing on the puzzling approach to MAS FSS price analysis issues and the default to a Low Price Regardless of Context (LPRC) analytical scheme exercised by GSA. Last week, our discussion reviewed some “puzzling” aspects of the MAS FSS price analysis. Specifically, what Professor Steve Schooner has long called, “the tyranny of low price,” i.e., the obsession with low prices absent a review of the terms, conditions, and other drivers of those prices; unclear operational policy guidance; repeated renegotiation of downward contract pricing; and inconsistent application of rules governing pricing analysis. This week, we drill down into GSA’s rules, tools, and practices that highlight the puzzling nature of GSA’s approach to pricing analysis…
The negative impact of the pricing puzzlers and drive for LPRC on MAS operations and customer agencies is real. MAS customer agencies are continuing to experience unfulfilled or canceled MAS orders as MAS contractors struggle to maintain their federal business (especially small businesses). Orders are unfulfilled as contractors, not seeing any movement on their EPA requests, cannot sell at a loss, regardless of who the customer is.
How do we put the MAS price analysis puzzle back together to deliver for customer agencies? As a threshold matter, this is a collective effort with FAS and industry working together towards a balanced, sound approach to MAS contract negotiation and management. Here are some suggestions:…
- To ensure a balanced, accountable approach to MAS price negotiations, all internal FAS policy guidance should be released to the public for review and comment.
- FAS should revisit the application of Section 876 which removes a program barrier to entry by eliminating the requirement to negotiate service rates at the contract level. The transactional data clearly demonstrates competition, value and price are driven at the order level. Thus, by doing so, Section 876 breaks down a barrier to innovation and small business participation…
