Earlier this month, the General Services Administration (GSA) launched its new reverse auction tool for commonly purchased products on certain Federal Supply Schedules (FSS). GSA’s Reverse Auction Platform — reverseauctions.gsa.gov — is designed to drive down procurement prices and increase taxpayer savings. Specifically, reverse auctions are intended to make the buying of non-complex commodities and simple IT services more efficient and effective by having sellers undercut each other and drive down the total costs of acquisitions.
Treatment of reverse auctions for FSS contracts has been varied in the past. For example, in March 2012, the Department of Veterans Affairs (VA) issued a memorandum ordering its contracting officials to suspend the use of reverse auctions as a procurement method. However, a month later, the VA lifted its ban on reverse auctions with an internal memorandum that set forth new guidelines for this method of procurement. A little over a year later, 12 GSA Schedules and 6 VA Schedules have been approved to be operated through the new reverse auction platform.
GSA reverse auctions are offered to federal agencies free of charge through GSA’s National Information Technology Commodity Program (NITCP). These auctions can be used to facilitate the request for and submission of quotes, offers or proposals for products, services, and solutions through GSA Multiple Award Schedules (MAS) and Blanket Purchase Agreements (BPAs). In addition, certain auctions may be set aside for small businesses.
According to GSA, federal agencies have saved as much as 17% through the use of reverse auctions. GSA also stresses the fact that these types of procurement vehicles provide greater transparency into government negotiations and pricing. With statistics like this, we advise that contractors get acquainted with reverse auctions because this type of procurement is here to stay.