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
LeScot Enterprises, Inc.
770-732-9392
. . .your connection to federal contracts
2
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
Review:
The GSA Schedule Program
What is a GSA
Schedule
Contract?
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 IF and WHEN an
agency places an order.
A "PRE-APPROVED FEDERAL PRICE LIST."
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
6
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)
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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
Basic Pricing Guidelines
1. Commercial Items with Established Catalog Prices:
2.
3.
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).
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.
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)
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.
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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.
Price Proposal Guidelines &
Best Practices
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
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.
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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.
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.
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.
Commercial Sales Practices
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.
*FAR Clause 552.212-70, Preparation of Offer (Multiple Awards Schedule).
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
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?
Supporting Documentation:
Making Your Case
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.
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).
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.
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.
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.
Dinora Gonzalez
614-434-6672
Federal Procurement Advisor
[email protected]
32
Dinora Gonzalez
Federal Procurement Advisors
Good Luck!
[email protected]
614-434-6672
Contact Information
Art Brown
LeScot Enterprises
[email protected]
770-732-9392
.
. .your connection to federal contracts
33
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What are your Commercial Sales Practices