Revamped rules unleash buying frenzy

Vendors holding General Services Administration Schedule B/C contracts are reporting record sales in the usually slow months of March and April, as agencies place multimillion-dollar orders that were previously prohibited.

Schedule holders are predicting even greater success as sales ramp up this summer and more agencies become aware of the opportunities offered under the revised rules of the multiple-award schedule program.

Vendors interviewed last week unanimously credited their success to program changes instituted last year by GSA's Federal Supply Service.

Those changes included the elimination of maximum-order limits and synopsis requirements, a willingness by FSS to actively market the schedules to federal users and a stipulation allowing agencies to negotiate their own purchasing agreements with schedule holders.

Tom Hewitt, president of Federal Sources Inc., predicted a 30 percent growth in schedule business this year.

"They've made it very easy to buy from, and GSA has become very aggressive in marketing it," he said.

Jim Connal, the federal sales manager at Gateway 2000 Inc., said agencies are considering the schedules as an alternative to buying off indefinite-delivery, indefinite-quantity (IDIQ) contracts.

"Look how long it has taken to award Desktop V, and now it's under protest," Connal said. "The schedules are there every day and offer excellent value. We are now seeing federal purchasers taking advantage of that."

Gary Newgaard, director of federal sales at Compaq Computer Corp., said his company's schedule sales rose 64 percent in an unusually busy first quarter this year.

But Newgaard added that the popularity of the schedules has not eaten into Compaq's IDIQ sales, which increased by 10 percent early this year.

He said many agencies, especially those in the Defense Department, would continue to support IDIQ contracts to ensure standardization and meet unique requirements.

Tony Colangelo, director of vendor relations at Government Technology Services Inc., said one advantage of schedule contracts is that they are usually modified after one or two days. And with the new GSA rules in place allowing large purchases, agencies can negotiate pricing similar to that of IDIQ contracts.

"It's clearly the best of both worlds," Colangelo said of the schedules. "As someone once said, 'GSA schedules have just become the largest IDIQ out there.' "

In the past two weeks, AmeriData Federal Systems entered into negotiations with two agencies seeking purchasing agreements worth more than $20 million each, said Gilbert Gautereaux, AmeriData's vice president of sales and marketing.

Larry Allen, executive director of the Coalition for Government Procurement, said the changes in the schedule program benefit agency contracting officers, who get lower prices, faster service and pay less overhead.

"It looks like it's working out for everybody," Allen said.