Purchasing agreements emphasize strategic sourcing, vendor diversity

Federal contracting officials can save nearly $200 million during the next four years by buying office supplies through one of 12 new blanket purchase agreements, the General Services Administration said on Wednesday.

The agreements -- essentially charge accounts set up with certain companies -- will help agencies meet the Obama administration's goal of cutting contract spending by 7 percent by fiscal 2011, according to GSA officials.

The 12 agreements use strategic sourcing to consolidate purchases and leverage the government's buying power. GSA said the pricing structure would save government buyers $48 million annually or $192 million over the life of the agreement. Agencies could spend as much as $800 million through the agreements during the next four years.

"These agreements show how [the Federal Acquisition Service's] skillful negotiations can, and do, leverage the buying power on behalf of agencies governmentwide," said Steven Kempf, acting commissioner of GSA's Federal Acquisition Service. "The expertise and care the contracting team displayed have driven the prices down and opened doors for sustainable technologies and environmentally preferable products, while providing substantial opportunities for small business."

According to the request for proposals, issued in March, a formalized commodity team, made up of officials from more than a dozen agencies, helped establish the agreements' requirements. Many of those agencies have made funding commitments to use the agreements, the document said.

"Some participating agencies currently have established agency-specific vehicles for the purchase of office supplies with advantageous pricing," the RFQ stated. "The aggregate participation of these and other agencies should result in pricing that is more competitive than that which a single agency can achieve. To this end, the contractor is strongly encouraged to offer BPA prices that are lower than pricing offered to any other federal government agency."

The agreements are divided into three pools of companies offering office supply catalogs. The first pool is composed of seven small businesses, the second includes two companies that are focused on price and the third consists of three service-disabled veteran-owned small businesses offering discounted prices on toner catalogs. Each of the pools emphasizes price and sustainable or environmentally friendly products.

Daniel Gordon, the administrator of federal procurement policy at the Office of Management and Budget, lauded the purchasing structure.

"The agency is doing a very good job in balancing our commitment to low prices with our commitment to smoothing the path to the federal marketplace for small businesses and service-disabled veteran-owned small businesses," Gordon said during a recent interview with Government Executive.

The agreements have other unique features, Gordon said. Unlike most BPAs, which are available only to a few agencies, they will be open governmentwide and available to all federal employees, he said.

"If you are a federal employee and you go into the winning vendor's store, you give them your federal purchasing card and you will automatically get these prices," Gordon said.