I think it’s time for another leap forward in how the Government approaches acquiring supplies. The commercial sector is replete with much of the stuff that supports business (office) operations. It has become accepted that Government warehouses stocked with these materials are not needed to ensure the smooth performance of daily operations. A lot of the acquisition of these goods is done outside the officially sanctioned Federal Government eCommerce sites. The US Government is losing visibility of where the money is going instead of channeling the business into its own transparent, made-to-suit Internet capabilities. Opportunity for intensely leveraged prices, streamlined business processes and strategic sourcing are being lost daily. Let’s just take one small leap this year and install customer product review capability in our Government on-line ordering platforms.
If we’re in the mood for more than that, here is another suggestion:
Only companies with a US Government contract are allowed to vie for the Government Purchase Card (GPC) business online within officially sanctioned US Government websites (e.g., DOD EMALL and GSA Advantage). At the same time, GPC holders can walk into any brick-and-mortar location to select items off the shelf at will or visit any commercial website and click with abandon. Commercial terms and warranties are completely acceptable when no one is looking evidently. The US Government needs to capture that walk-in business on its own eCommerce platforms for three reasons:
- The data being collected on Government Purchase Card (GPC) usage is murky and incomplete. By consolidating GPC activity to officially sanctioned Government owned and operated eCommerce sites transparency on GPC usage can be achieved.
- Compliance with laws and regulations concerning mandatory sources and socioeconomic program support can be monitored and enforced.
- Channeling this tremendous volume of supplies will allow the Government to begin to strategically source material in unprecedented ways. In fiscal year 12 DOD EMALL had $86 million in office supply sales and nearly $10 million in electronics. We don’t know what the sales in these categories are for brick-and-mortar purchases or commercial websites, but imagine the prices you could command if all this business were fed through one or two made-for-Government channels!
So how do we make that happen? I see two options: one I’ll call “Quick” and the other I’ll call “Better.”
The Quick option would be to allow all comers to enter the Federal marketplace limited only by the GPC of the person ordering instead of insisting on a contract (which is expensive for many of these vendors to acquire and carries administrative costs for the Government). This does not violate what GPC holders are already allowed to do outside of the Federal marketplace and has the added bonus of vendor “natural selection” based on GPC holder choices.
The Better option would be to select only 3 vendors for long term contracts in each major category and guarantee that business to them for the length of the contract. Once the prices offered in the Federal marketplace really do beat what you can find on the open market GPC holders will want to trade there.
Both solutions require one more thing: a mandate that the Federally sanctioned web ordering capabilities be used by GPC holders for certain classes of supplies to the exclusion of brick-and-mortar and commercial web sites. We’ll discuss that in my next blog post.