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HORAN. GSA Search Engine Ranker. Well, the way I would like then to figure it out is if it actually produces a much better worth, best worth to the government, considering the expense to the professionals. I do not believe they can do that based upon the way in which the proposed guideline is carried out here.

Little businesses are known for the added value they can offer agencies with advantages such as customer support. Huge corporations or huge business can refrain from doing that. Mr. Horan, you specified in your testament that the brand-new guideline does not account for such added worth. Asia Virtual Solutions. What could this omission suggest not only to small vendors however also to the companies that buy their items and services? Mr.

I think those other terms that lead to best value might be lost. Again, that it could be-- the procurement could be driven to low cost just, and as an outcome of that, the professionals who provide a few of these other terms and services that provide finest worth will lose sales at a minimum, possibly be driven out of the market.

Due to the fact that they are out of the company or they are simply not bidding any longer? Since they are out of the organization. Due to the fact that there is such pressure on contracting officers to look at just low cost that often they will omit factor to consider of best value but ultimately, I believe they might be out of the company.

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TAKAI. Okay, thank you (GSA SER Software). The quotient for federal government procurement survey in its study, small companies suggest that it would take on typical 232 hours to adhere to the GSA's proposed rule. Mr. Stanford, has your company done its own price quote on the hours it will require to comply with the brand-new requirement, and do you find the results of the study to be more precise than GSA's own analysis? Mr.

We have not. And while we have looked at their study and the ABA work, we are also motivated in accepting their conclusion because also SBA Office of Advocacy and GSA's own inspector general determined that those costs seem understated. Mr. TAKAI. Their, suggesting the union, not GSA's? Mr. STANFORD.

Other than our spin on compliance, can you discuss some other expenses that companies like yours will have to deal with due to the fact that of this guideline? I will not speak to our business separately, but speaking to the business we work with as they enter the federal market, the costs beyond compliance are-- for small services are preliminary costs up front.

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Mentioning the cost of upgrading its data systems, GSA is proposing to ask suppliers to report to GSA the details of what was purchased through GSA. This is like asking merchants selling through Amazon to report to Amazon what it offered, through Amazon. To take this example one action even more, Amazon would then use that details to advertise prices to other customers, on Amazon.

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While not a best comparison, GSA in numerous methods operates as an Amazon-like part of the acquisition procedure. The intent behind this rule is looking for to make a best-in-class contracting market. Yet, GSA has chosen to pass on investing in an information collection system that might collect this details immediately.



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II. The Guideline Enforces a Significant, Underestimated, and Unnecessary Problem GSA approximates that it will take 6 hours for a specialist to achieve all jobs required to comprehend the reporting requirements, prepare its systems and workers, and establish the procedures essential for developing the needed reports, and a typical 31 minutes per month for continuous reporting. 2 GSA does not supply enough detail to evaluate how these quotes are flawed, however essentially every notified celebration who has actually weighed in on these quotes thinks they are unreliable.

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Reg. 11625.

Otherwise, the specialist will run the risk of an accusation of scams under the False Claims Act, as has actually held true with essentially every other kind of rate or cost reports sent by a contractor to the federal government. Importantly for this hearing, small companies will bear the largest part of this concern-- GSA estimated that out of 15,738 vendors holding contracts that would undergo this Rule, 12,590 are small companies (GSA Search Engine Ranker).

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Reg. 8 GSA likewise acknowledges a point extremely important to market-- that price paid is just of many "info points"in determining the best value to the federal government. 10 We can also add consumer service, product support services, guarantee, and other terms to this list.

According to GSA's own analysis, this concern enforced on contractors will provide the federal government with only one of the necessary info points-- transactional price-- without any methods to get the other details points required to evaluate rate. Without access to, and consideration of, this other important details, the cost info is of little worth at finest and can be really deceptive at worst.

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In my view, the failure of the Rule to capture these other non-price elements might be especially harmful to small organizations. Small companies frequently run as value-added resellers or otherwise differentiate themselves in the competitive market based upon the value they contribute to a transaction, such as consumer and product service capability, that is not caught by deal price.

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