New sked plan boosts online buys

General Services Administration officials plan to issue this week a solicitation that would merge all the information technology schedules into a single program while placing new requirements on vendors, including a controversial measure to require that all IT products be available on the GSA Advantage electronic commerce (EC) system.

Other changes in the program include an expansion of the terms of all contracts, regardless of award date, to five years with one five-year option period; an obligation for vendors to accept credit cards for orders less than $2,500; and a requirement for vendors to report electronically their quarterly sales via the Internet instead of on bubble cards.

Bill Gormley, assistant commissioner for acquisition at GSA's Federal Supply Service, said the changes in the forthcoming solicitation will make the program more attractive to schedule customers throughout the federal government while reducing the administrative burden to GSA and to schedule vendors.

For the most part, vendors applauded the changes. Larry Allen, executive director of the Coalition for Government Procurement, said most IT schedule vendors are prepared to accept credit card orders, a requirement largely driven by the Defense Department. He said longer contracts will benefit vendors and GSA by eliminating the need to negotiate new deals each year.

Allen did note that some vendors may not like the idea of contracts that expire at different times. "Some might think it's unfair if their contract expires while their competitor's still exists," he said.

Allen said his greatest concerns focused on a requirement that would force vendors to make all their products available via GSA Advantage within an as yet unspecified time after contract award. He said some vendors cited problems with Advantage internal to GSA, and others insisted that such a system does not lend itself to the purchase of high-end equipment such as mainframes.

Olga Grkavac, senior vice president with the Information Technology Association of America's Systems Integration Division, said it will be extremely difficult for vendors of high-end computers to succinctly describe their equipment on an EC system. "It's not something you can list by pricing," she said. "I think the vendor community would prefer some other options."

An official with a mainframe company, who did not want to be identified, said GSA Advantage is "non-user-friendly," and that vendors have had difficulty formatting information for the system.

"We think GSA Advantage can work well for things like batteries and hammers," the official said. "But when you get to things like mainframes, it's very difficult. We are proposing that GSA simply put onto GSA Advantage the names of vendors listed by product category and create the ability for the agency to hyperlink directly to that vendor's home page on the Internet."

Another vendor who requested anonymity said it would be nearly impossible for customers to purchase high-end equipment through GSA Advantage because of the complex processes needed to ensure they receive the correct configuration.

The vendor also noted that few federal IT customers use GSA Advantage as an ordering mechanism, and argued that GSA is asking agencies to expend a lot of time and money on something that will produce little payback.

David Hoy, director of contracts at Government Technology Services Inc., said his company has used GSA Advantage to a great extent during the past year, and it supports GSA's new requirement. He did acknowledge that sales via the system have been nearly nonexistent -- less than one percent of the company's schedule sales last year.

Gormley disagreed, noting there are now 631 vendors who sell through GSA Advantage, which has received more than 328,000 hits since late March 1997. He added that 63,000 orders were placed during the first quarter of fiscal 1998. Gormley expects sales through the system to double this year to more than $50 million.

Other knowledgeable sources place sales off GSA Advantage at $1 million a month last fiscal year and suggest it is still in an investment mode as the agency tries to build usage.

"A lot of agencies are using it for research and then cutting the order internally," Gormley acknowledged. "The companies aren't seeing that business coming through Advantage, but that number is growing."

Although Gormley insisted he wants to include products from all vendors "regardless of what they sell," he added that he will not require high-end computers to be listed until GSA officials meet with vendors of those products to work out the best way to proceed.