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Follow the Money of ‘Solicitation Procedures’ Spending

HCB Guy on Mic2Agencies communicate contracting opportunities to potential vendors using a variety of methods which for starters, can determine if availability of the opportunity is broad or limited. Knowing which solicitation procedures are used for the goods and services you offer by the organizations your company is pursuing is important as is understanding how the use of relevant solicitation procedures has changed.

Here’s how fiscal spending has changed for solicitation procedures used by civilian, defense and intelligence agencies.

The Chief Visionary

Why are ‘Solicitation Procedures’ important?

18665048_ml questionIn a nutshell, understanding solicitation procedures is part of knowing how agencies make buys, or more specifically, how they announce buys. Depending on what you sell and to whom you are selling, different procedures may impact you. Additionally, how your company is positioned from a contracting standpoint, also dictates which procedures include you or exclude you.

Consider this, if your company is tracking spending at a specific contracting office, you can determine how they buy what you sell based on the Award/IDV Type they use as well as by the Solicitation Procedures. In the Federal Procurement Data System, transactions referenced as IDV Type ‘IDC‘ or Award Type ‘Delivery Order‘ indicate those particular buys were made using an indefinite delivery contract such as an IDIQ, or were delivery or task orders placed against one of four different indefinite delivery vehicles (IDV), a BOA, FSS, GWAC or IDC.

Having this knowledge (and knowing how to use it) before you invest marketing and business development resources can go a long way in decreasing your cost of acquiring business and increasing efficiency.

What about spending under Solicitation Procedures?

It’s no secret the fiscal spend has been declining for a number of years. From FY 2009 to FY 2014, the governmentwide contracting spend shrank by nearly $100 billion. Based on this, spending decreases for  the various solicitation procedures won’t be a big surprise to anyone, but what if there were spending increases for certain solicitation methods? Would that have an impact on how your company is currently doing business? Do you know if it should?

FPDS-NG identifies nine (9) solicitation procedures used in its history of government transactions. They are:15396748_l time and money

  1. Alternative Sources
  2. Architect-Engineer FAR 6.102
  3. Basic Research
  4. Negotiated Proposal/Quote
  5. Only One Source
  6. Sealed Bid
  7. Simplified Acquisition
  8. Subject to Multiple Award Fair Opportunity
  9. Two Step

Don’t worry if some or many of these don’t sound familiar because some you would only see using tools like FPDS-NG or hanging out with folks who have a designation as a Contracting Specialist, Contracting Officer and similar. But if your company is set on leveraging competitive intelligence to increase your odds of finding and winning business, now would be a good time to learn them, at least to determine which one’s are relevant to you.

Impact of reduced spending on Solicitation Procedures.

As I was saying, given the downturn in federal spending over the years, seeing shrinkage under each of the nine procedures would not come as a surprise. Believe it or not, there are two which have seen growth during the period of this report (Fiscal Year 2009 through Fiscal Year 2014) and one continues to grow even into Fiscal Year 2015. The following graphic provides a snapshot of the changes in spending over the last five fiscal years:

20151003 How Solicitation Procedure Use Has Changed

(Click image to enlarge.)

Hopefully the first thing you noticed were the two methods that have bucked the trend and have realized increased spending. The larger of the two (by spending) refers to spending under multiple-award contract vehicles such as Blanket Purchase Agreements, Indefinite Delivery Contracts (IDDQ, IDIQ and IDR) and Government Wide Acquisition Contracts such as NASA SEWP, GSA ALLIANT and NIH CIO-CS. Unfortunately, this too has succumbed to declines as it too is shrinking having lost over $7 billion in fiscal obligations between FY12 and FY14. Granted, it’s average fiscal spend is nearly double what was reported in FY2009, since FY2011 it’s spiraling downward.

Nevertheless, it’s the third biggest pot on the board, so don’t ignore it.

Thar she grows!

gregorypeckIs it coincidence the sole solicitation procedure still achieving growth happens to be my favorite streamlined purchasing method? One can only wonder! I’ve lived and breathed Simplified Acquisitions for over twenty years and have watched agencies increase spending under this method over the last seven years. By the time the final numbers are read for FY2015, buys made this way will have increased again, while everything else continues to shrink. It’s got to be a sign of some sort and because these purchases are inherently geared to small business concerns, I hope it’s a sign they see.

The previous graphic doesn’t do justice to the growth of Simplified Acquisitions because it doesn’t fully illustrate the one billion dollar average spending increase that’s occurred since FY2010 and I’m pretty certain will continue through FY2015 (even without Congress’ help)! So here’s the other graphic you should see:

20150103 FY10 through FY14 Total Obligations vs SAP

(Click image to enlarge.)

We’re in a new fiscal year and for now, operating under a continuing resolution which limits what agencies can spend and what they can make buys for. Through the continuing resolutions and declining budgets, buys made using the Simplified Acquisition Procedures have shined. Agencies have increased their use of this lesser-known procurement method and decreased dollars spent on other purchasing methods like the GSA Federal Supply Schedule. In fact, although the GSA Schedule has fewer constraints (such as a threshold of $150,000) and accounts for billions more in contracting dollars every fiscal year, a dollar-for-dollar comparison shows Simplified Acquisitions have greater economic impact on small federal contractors.

Take the opportunity to find (and win) more opportunities.

To learn how your company can grow by adding Simplified Acquisitions to your company’s pipeline, register for an upcoming seminar or webinar 19310424_mlentitled Finding and Winning Simplified Acquisitions or increase your ability to ‘connect the dots’ at our Competitive Intelligence Bootcamp.

In case you didn’t pick up on my subtle hints in this article, if you don’t do anything else, make sure you follow the money.

Peace!

Guy Timberlake, The Chief Visionary (bio)
http://www.theasbc.org/visionary

“The person who says it cannot be done should not interrupt the person doing it.”

About Editor-in-Chief Visionary

Guy Timberlake is the Editor-in-Chief Visionary of GovConChannel and oversees the creation and curation of relevant and timely 'News And Information That Matters To Small Government Contractors.'

Discussion

One thought on “Follow the Money of ‘Solicitation Procedures’ Spending

  1. A very insightful and detail laden article. If you don’t get it, …you don’t get it!

    Liked by 1 person

    Posted by rcd2012 | October 5, 2015, 08:33

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