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Published Oct 04, 21
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HORAN. GSA SER Services. Well, the method I would like then to figure it out is if it really produces a much better value, best value to the government, thinking about the cost to the specialists. I do not think they can do that based on the manner in which the proposed guideline is executed here.

Little businesses are understood for the included worth they can provide agencies with advantages such as consumer service - GSA Search Engine Ranker. Mr. GSA SER Services. Horan, you specified in your testimony that the new rule does not account for such included worth. Again, that it might be-- the procurement might be driven to low rate just, and as a result of that, the specialists who provide some of these other terms and services that offer finest worth will lose sales at a minimum, maybe be driven out of the market.

Mr. TAKAI. Due to the fact that they run out business or they are simply not bidding any longer? Mr. HORAN. Since they are out of business. I mean, there are other concerns as well. Since there is such pressure on contracting officers to look at just low cost that often they will leave out consideration of finest value however eventually, I believe they could be out of the service.

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The quotient for government procurement survey in its study, little businesses suggest that it would take on typical 232 hours to comply with the GSA's proposed guideline. Mr. Stanford, has your organization done its own estimate on the hours it will take to comply with the brand-new requirement, and do you discover the results of the survey to be more precise than GSA's own analysis? And while we have actually looked at their research study and the ABA work, we are also encouraged in accepting their conclusion due to the fact that also SBA Office of Advocacy and GSA's own inspector basic determined that those costs appear downplayed.

Mr. TAKAI. Okay. Aside from our spin on compliance, can you go over some other expenses that companies like yours will have to face since of this guideline? Mr. STANFORD. I will not speak with our business separately, however speaking to the business we work with as they get in the federal market, the expenses beyond compliance are-- for little services are preliminary expenses in advance.

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Pointing out the cost of updating its information systems, GSA is proposing to ask suppliers to report to GSA the details of what was purchased through GSA. This is like asking merchants offering through Amazon to report to Amazon what it offered, through Amazon. To take this example one action even more, Amazon would then utilize that information to promote prices to other customers, on Amazon.

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While not a best contrast, GSA in numerous methods operates as an Amazon-like part of the acquisition procedure. The intent behind this rule is seeking to make a best-in-class contracting marketplace. Yet, GSA has chosen to pass on buying a data collection system that might gather this details automatically.

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II. The Guideline Enforces a Substantial, Underestimated, and Unnecessary Burden GSA estimates that it will take six hours for a contractor to achieve all jobs required to comprehend the reporting requirements, prepare its systems and personnel, and establish the procedures necessary for producing the required reports, and an average 31 minutes each month for continuous reporting. 2 GSA does not supply enough detail to examine how these quotes are flawed, but essentially every notified party who has weighed in on these quotes believes they are unreliable.

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Reg. 11625. The Small company Administration's Office of Advocacy reports that small companies and their agents are concerned that GSA "under price quotes the problem and resources." 3 The Council of Defense and Space Market Associations views the quotes as "grossly underestimated,"as failing to "account for pricey modifications to details systems that will be needed to precisely and totally record the information aspects needed by the rule"or to "adequately represent the time required to carry out quality control on draft submissions and investigation into possible information abnormalities that regularly emerge with transactional information reporting." 4 Based upon its experience with pre-award audits of specialist systems, the GSA Workplace of Inspector General "concern [s] whether GSA's price quote of 6 hours per contractor to configure their systems for reporting is precise"and "contend [s] the forecasted burden of month-to-month reporting as 0.

Otherwise, the professional will run the risk of an accusation of scams under the False Claims Act, as has actually been the case with basically every other type of price or expense reports submitted by a specialist to the government. Notably for this hearing, small companies will bear the largest part of this concern-- GSA approximated that out of 15,738 vendors holding agreements that would be subject to this Rule, 12,590 are small companies (GSA SER Software).

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Reg. 11625. III. The Anticipated Advantage is Improperly Specified, and Not --------------------------------------------------------------------------- Likely to be Realized GSA prepares for that the transactional information will "enhance GSA's ability to perform significant cost analysis and more effectively and successfully validate fair and affordable prices"on its contracts and will allow government buyers "to compare rates prior to placing orders." 8 GSA likewise recognizes a point really important to industry-- that price paid is just of numerous "details points"in identifying the very best worth to the government. 9 Equally essential are other factors to consider, "such as total expense, preferred efficiency levels, delivery schedule, special terms and conditions, time considerations, and consumer satisfaction." 10 We can likewise include customer service, product assistance services, warranty, and other terms to this list (GSA Search Engine Ranker Services).

According to GSA's own analysis, this burden enforced on professionals will offer the federal government with only one of the required details points-- transactional price-- without any means to obtain the other info points essential to assess rate. Without access to, and factor to consider of, this other essential info, the cost details is of little value at best and can be extremely misleading at worst.

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In my view, the failure of the Guideline to capture these other non-price factors might be specifically harmful to small businesses. Small companies typically operate as value-added resellers or otherwise identify themselves in the competitive market based upon the worth they include to a deal, such as customer and product service capability, that is not captured by deal price.



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