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HORAN. GSA Search Engine Ranker. Well, the way I would like then to figure it out is if it in fact produces a much better value, finest value to the government, thinking about the expense to the contractors. I do not think they can do that based upon the way in which the proposed rule is executed here.

Small companies are known for the added worth they can supply firms with benefits such as customer service. Big corporations or big companies can not do that. Mr. Horan, you mentioned in your testament that the new guideline does not account for such included value. GSA SER Software. What could this omission imply not only to small vendors but also to the companies that acquire their products and services? Mr.

I think those other terms that lead to finest value could be lost. Again, that it could be-- the procurement might be driven to low cost only, and as a result of that, the specialists who offer some of these other terms and services that offer best value will lose sales at a minimum, perhaps be driven out of the market.

Because they are out of the company or they are just 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 only low rate that often they will leave out factor to consider of finest worth but eventually, I believe they might be out of the organization.

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TAKAI. Okay, thank you (GSA SER). The quotient for government procurement study in its survey, little businesses indicate that it would handle typical 232 hours to comply with the GSA's proposed rule. Mr. Stanford, has your company done its own price quote on the hours it will require to adhere to the brand-new requirement, and do you discover the outcomes of the survey to be more accurate than GSA's own analysis? Mr.

We have not. And while we have actually taken a look at their study and the ABA work, we are likewise motivated in accepting their conclusion since likewise SBA Workplace of Advocacy and GSA's own inspector basic identified that those costs seem downplayed. Mr. TAKAI. Their, implying the union, not GSA's? Mr. STANFORD.

Other than our spin on compliance, can you talk about some other costs that companies like yours will have to face since of this rule? I will not speak to our company separately, but speaking to the business we work with as they go into the federal market, the costs beyond compliance are-- for little businesses are preliminary costs up front.

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Citing the cost of updating its data systems, GSA is proposing to ask suppliers to report to GSA the information of what was purchased through GSA. This resembles asking retailers selling through Amazon to report to Amazon what it offered, through Amazon. To take this example one action further, Amazon would then use that info to market rates to other consumers, on Amazon.

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While not an ideal comparison, GSA in lots of ways runs as an Amazon-like part of the acquisition process. The intent behind this rule is seeking to make a best-in-class contracting marketplace. Yet, GSA has decided to pass on purchasing a data collection system that could collect this details immediately.

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II. The Guideline Imposes a Considerable, Underestimated, and Unnecessary Burden GSA approximates that it will take six hours for a professional to accomplish all tasks needed to comprehend the reporting requirements, prepare its systems and workers, and develop the treatments essential for creating the required reports, and an average 31 minutes monthly for continuous reporting. 2 GSA does not offer sufficient detail to evaluate how these price quotes are flawed, but virtually every notified celebration who has actually weighed in on these price quotes believes they are unreliable.

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Reg. 11625.

Otherwise, the contractor will risk a claims of fraud under the False Claims Act, as has actually held true with essentially every other type of rate or cost reports sent by a specialist to the government. Significantly for this hearing, small companies will bear the biggest part of this burden-- GSA estimated that out of 15,738 suppliers holding agreements that would undergo this Rule, 12,590 are small companies (GSA SER Services).

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Reg. 8 GSA also recognizes a point very essential to market-- that cost paid is only of many "information points"in identifying the finest value to the government. 10 We can likewise include customer service, product assistance services, warranty, and other terms to this list.

According to GSA's own analysis, this concern enforced on professionals will supply the government with only one of the essential information points-- transactional cost-- without any means to acquire the other info points necessary to assess rate. Without access to, and consideration of, this other essential info, the price details is of little value at finest and can be very deceptive at worst.

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In my view, the failure of the Rule to catch these other non-price factors might be especially hazardous to little businesses. Small companies frequently operate 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 item service ability, that is not recorded by transaction rate.

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