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Preparing the GSA Schedule Pricing Proposal

Preparing the GSA Schedule Pricing Proposal. Today’s Objective: Help you understand the Requirements of the GSA Price Proposal Instructions so that you can Create and Submit a successful Proposal. Dinora Gonzalez Federal Procurement Advisors, LLC 614.434.6672 Art Brown

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Preparing the GSA Schedule Pricing Proposal

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  1. Preparing the GSA Schedule Pricing Proposal Today’s Objective: Help you understand the Requirements of the GSA Price Proposal Instructions so that you can Create and Submit a successful Proposal.

  2. Dinora Gonzalez Federal Procurement Advisors, LLC 614.434.6672 Art Brown LeScot Enterprises, Inc. 770-732-9392 . . .your connection to federal contracts

  3. Topics We Will Cover: • Fair & Reasonable Pricing • Basic Pricing Guidelines • The Proposal Price List Template & Calculating the Industrial Funding Fee (IFF) • Labor Categories & Service Contract Act Requirements • Organizing your Data / Information • Describing your Commercial Sales Practices • Supporting Documentation: Making Your Case

  4. Review: The GSA Schedule Program

  5. Pre-negotiated contracts where prices; contract terms; and, conditions have been agreed to in advance and are considered “fair and reasonable” by the government; Agreements between the federal Government and eligible vendors who agree to honor negotiated prices, terms and conditions IFand WHENanagency places an order. What is a GSA Schedule Contract? A "PRE-APPROVED FEDERAL PRICE LIST."

  6. How Does It Work? • Pre-Approved Vendors are listed on the online shopping catalog called GSA Advantage. Buyers are allowed to purchase through this catalog. • Download and fill out the appropriate solicitation for products or services; • Submit pricing and technical capabilities as specified by the solicitation; • Go through a past performance evaluation

  7. Features of the GSA Schedule Contract: • Widely Used by Federal Buyers: • Streamlined Procurement Process • 5 Year Basic Contract with 3 five year option periods • Non-Bid Contract: Vendors can apply for a GSA Schedule Contract by filling out and submitting the appropriate solicitation • Vendors can offer their commercial price (with a discount)

  8. Participation Criteria • Sales: $25,000 in sales per year (or show potential) • Registration / Certification • Duns & Bradstreet: www.dandb.com/DUNS (866) 403 5579 • Systems Award Management: www.sam.gov • Experience / Performance History Open Ratings (http://www.ppereports.com) • Accept Credit Card as payment

  9. Basic Pricing Guidelines

  10. Commercial Items with Established Catalog Prices:Offerors shall submit a copy of their established commercial catalog (published and dated), internal business memorandum, pricing guide, rate card or other documentation with relevant SIN Commercial Items without Established Catalog Prices:Offerors shall provide documentation to substantiate proposed pricing (e.g., agreements with corporate customers, internal policies, market prices, quote sheets, invoices, etc.). The pricing documentation shall assure that customers, effective period, pricing and price related terms and conditions are clear. Cost-Based Rates:Offerors shall demonstrate rates, profit, overhead, G &A and Industrial Funding Fee; showing the calculation of the proposed fully burdened rates for each labor category in each respective SIN. Provide documentation to substantiate pricing (e.g., agreements with corporate customers, internal policies, quote sheets, and invoices, etc).

  11. Other Direct Costs: Other Direct Costs (ODCs) include such things as materials, commercial production, equipment rental, labor, etc. that support the services to be performed. Labor as an ODC is usually a subcontractor. The pricing proposal should include supporting documentation for the actual ODC expenses paid by the offeror. Cannot be procured as a stand alone item or service.

  12. Price Template Price proposals to the Government should be priced the same way as price proposals to commercial customers. Offerors are required to include a 0.75% Industrial Funding Fee (IFF) in the prices submitted with their offer (See contract clause 552.238-74) Prepare an Escalation Rate Matrix if requesting an annual escalation rate under EPA Clause I-FSS-969 (b) (1); OR – indicate economic indicator (normally Department of Labor BLS Table 5) under EPA Clause I-FSS-969 (b) (2)

  13. Developing a GSA Labor Category and Pricing Strategy: • GSA labor categories should reflect your business practices and your people: • Be prepared to demonstrate commercial sales of all labor categories proposed. • Labor categories should resemble commercial or internal labor categories. • Providing a crosswalk between labor categories may be necessary during negotiations.

  14. Developing a GSA Labor Category and Pricing Strategy: • Labor category descriptions should contain clear and quantifiable requirements including: • Minimum years of experience; • Minimum education; • Functional roles and responsibilities of the position; • Any applicable training, licenses or certifications; • A methodology for substituting experience for education.

  15. Price Proposal Guidelines & Best Practices

  16. Challenges • Many contractors do not have a published commercial catalog for services. The GSA catalog was created to sell products and services. • Professional services business practices and pricing do not fit well within the current GSA contracting model. • Regulatory guidance not adequately updated

  17. What is Price Reasonableness? The concept of a fair and reasonable price has been described as the price that a prudent business person would pay for an item or service under competitive market conditions, given a reasonable knowledge of the marketplace. Your price(s) should be easy to justify and one that reasonably reflects a price that you should expect to pay for your customer’s requirement.

  18. Evaluating Fair & Reasonable Pricing (FAR 15.404-1) Price analysis is the process of examining and evaluating a proposed price without evaluating its separate cost elements and proposed profit. Cost analysis is used to evaluate the reasonableness of individual cost elements in addition to looking at the bottom-line total price.

  19. PRICING MUST BE SUBSTANTIATED BY: • Established commercial catalog prices (published and dated pricelists) • offerors who do not use a published and dated commercial pricelist must submit cost or pricing information such as copies of contracts, invoices, agreements, internal business memorandums, quote sheets, or additional information requested by the contracting officer. • Proposed hourly and unit pricing should include direct and indirect costs, and profit, that contribute to the proposed hourly or unit price.

  20. Bottom Line: The pricing proposal should include sufficient information for each service offered to enable the contracting officer to perform a price analysis in accordance with far 15.4.

  21. Commercial Sales Practices

  22. *FAR Clause 552.212-70, Preparation of Offer (Multiple Awards Schedule). Commercial Sales Practices* You must disclose your current procedures / process for selling to the commercial market Who is your Most Favored Customer? What prices, terms, and discounts do they receive? Describe any deviations from your normal pricing.

  23. What are your Commercial Sales Practices? • What am I selling? • Products / Services / Both? • How do I price it? • Labor by the Hour (or other appropriate unit) • By Service / Task (does not matter how long it takes) • Time + Material (labor and material / equipment) • A Mix of the above

  24. What are your Commercial Sales Practices (Cont. .)? • How are you selling it? (pricing structure) • Commercial Price List (Catalog Pricing) • Market Pricing • Do you have a discount policy? • Which customers receive your best (lowest) rate; discounts; and terms? • Do you have evidence / proof of pricing?

  25. Supporting Documentation: Making Your Case

  26. Organizing Your Data / Information Documents: • Review & organize your purchases orders / invoices / receipts: • Dated; must describe work or product being purchased at the rate you stated in your commercial sales practices. • Deviations must be explained. • Review Statements of Work (Master Agreements, contracts or letter agreements). Must be dated and describes the scope of work to be performed • Your documents should verify your pricing and the work performed.

  27. Supporting Documentation Could Include: • Competitor’s Comparison Matrix / Historical Pricing Analysis • Detailed description of the analysis performed to arrive at the proposed prices. • Limited Cost Data or Price Analysis (If offering Market Pricing, you must show how you derived at price / cost. One way is to “back in” to your price by providing a breakdown of components and related price that makes up the total price).

  28. Pricing Models • Build a spreadsheet model to price the action • Use if offering market pricing without established catalog • Includes all cost elements & Profit • Model should validate accuracy of contractor’s proposed price • Cross-Reference with invoices; purchase orders; receipts.

  29. Best Practice: Create a Price Reasonableness Narrative Overview of the business, its service offerings and organizational structure Overview of customer categories (e.g., State & Local, Commercial, Healthcare, etc.). Detailed description of the analysis performed to arrive at the proposed prices.

  30. Price Reasonableness Narrative (cont. . .) Explain any deviations from standard pricing practices and the frequency with which they occur. Overview of the proposed BOA customer(s) and an explanation of why that customer is appropriate.

  31. Dinora Gonzalez 614-434-6672 Federal Procurement Advisor dgsmallbusiness@gmail.com

  32. Dinora Gonzalez Federal Procurement Advisors dgsmallbusiness@gmail.com 614-434-6672 Good Luck! Art Brown LeScot Enterprises art@lescott.com 770-732-9392 Contact Information . . .your connection to federal contracts

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