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GSA is Cutting 8,000 Contracts

The GSA announced on June 7, 2012 that they are cutting 8,000 contracts from the GSA Schedule. The GSA is cutting contracts where outdated items are rarely purchased by the federal government (typewriters, photographic equipment, etc).  Keeping these schedules open was costing the GSA $24 million dollars annually as each schedule is reported to have cost $3,000 per year.  This cost is regardless of whether there was any business activity in those schedules, and there was likely not enough activity to justify keeping them open.

This change will help move these skilled GSA contract administers to other areas decreasing time to obtain a schedule, and allowing the GSA to focus on newer and more innovative products.  In recent years the number of modifications to existing contracts has tripled.  This means that firms who are getting on schedule are adding additional products and services to their schedules, therefore increasing the product offerings.

The GSA has also began to get more serious about enforcing the minimum annual sales of $25,000. A firm with a GSA Contract with no substantial sales is going to be much more likely to have their contract renewal rejected for lack of sales. Another reason for a GSA Schedule renewal option to be rejected is a lack of price list updates, where the products/services are stale and unusable. These two factors usually go hand-in-hand.





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