The Federal Cooperative Purchasing Program
Small businesses can meet the information technology needs of local and state governments through cooperative purchasing participation.

By Benjamin Taylor

The U.S. General Services Administration's (GSA) Cooperative Purchasing Program allows state and local governments to purchase their various information technology needs from companies selling to the federal government through the Information Technology Schedule 70. 

According to the GSA, "The IT Schedule allows for choice, flexibility, ease of use and access to quality businesses in the IT arena, from small businesses to the industry giants."

The IT Schedule 70 takes advantage of large selling potential to leverage best value offerings, and offers federal, state and local governments over a million information technology products, software and services.

Cooperative Purchasing Basics
Cooperative purchasing accounted for $240 million in fiscal year 2006, and has grown steadily every year since its inception in 2003. There are currently 3,600 contractors on schedule participating in the program, which accounts for 69 percent of all IT contractors. Businesses interested in selling through IT Schedule 70 and the Cooperative Purchasing Program need to know a few basics:

• Voluntary Participation - The Cooperative Purchasing Program is voluntary for both state and local governments, as well as IT Schedule 70 vendors.  
• Eligibility - In addition to being able to sell to all federal agencies, vendors may sell to eligible state and local entities, including all 50 states, counties, municipalities, cities, towns and townships, tribal governments, public authorities, school districts, colleges and institutions of higher education. 
• State and Local Level Eligibility - Each state has its own procurement regulations and policies. While quite a few states have regulations or policy regarding Cooperative Purchasing, some states still need to make legislative changes to procurement procedures before being able to purchase through the program.  
• Customer Benefits - The program offers a number of advantages, including:
  a. Centralized IT and telecommunications source
  b. Ease of use
  c. Leveraged pricing with additional price reductions allowed
  d. Fair terms and conditions and best value pricing
  e. Maximize IT expenditures
  f. State and local specific research tool
  g. Reduced procurement lead time
  h. Lower administrative costs
  i. Direct customer to vendor relationship

Cooperative Purchasing Ordering
Be aware that exact procedures may vary according to each state and local government. Though they vary, GSA recommends that state and local governments follow the ordering procedures outlined in the Federal Acquisition Regulation (www.arnet.gov/far).

In general, cooperative purchasing orders involve the following steps for customers:
1. Research the acquisition using GSA's online tools at www.gsaelibrary.gsa.gov or www.gsaadvantage.gov
2. Tailor requirements to needs
3. Solicit offers from selected contractors
4. Evaluate the options and make a selection in accordance with stated evaluation criteria
5. Issue/make award/order
6. Receive the products or services from the contractor
7. Pay the contractor according to the contract agreement

Once a vendor accepts the order and an issue, award or order is formally accepted by the state and local agency, the federal government is no longer privy to the contract. Therefore, any disputes or other issues are handled at the state or local level. State or local governments may use additional terms and conditions specific to their purchasing polices as long as the term and conditions do not conflict with GSA's.
  
Cooperative Purchasing and Small Business
Of the roughly 5,200 contractors on IT Schedule 70, there are 4,600 small businesses (88 percent) of which nearly 3,000 are participating in the Cooperative Purchasing Program. Small businesses accounted for 40 percent of total state and local sales, which equaled $97 million in fiscal year 2006. In the top 250 vendors, 40 small businesses had sales of half a million dollars or more.

As an IT Schedule 70 vendor, all information related to business size or socioeconomic category is clearly visible in the e-Tools suite, making it easier for state and local governments to identify vendors who meet their procurement criteria. In addition, state and local governments often look at local area or in-state vendors when seeking potential contractors. GSA's E-Library has features that allows for sorting vendors by city or state and for searching by socioeconomic category.

Cooperative purchasing will continue to be an area of growth. From 2003 to present, the program has grown more than 40 percent each year - from $33 million to over a $250 million last year. The state and local IT market is projected to be approximately $92 billion in fiscal year 2007.  And with budgets expected to grow tighter in 2008 and 2009, state and local governments will be looking for ways to reduce costs and save money while still meeting their missions.

Becoming a IT Schedule 70 Vendor
If you are interested in becoming an IT Schedule 70 vendor, you can obtain a copy of the solicitation at www.gsa.gov/schedule70solitication. Make sure to carefully read the cover sheets, and the entire solicitation. GSA wants to ensure that vendors know what they are undertaking, and that they can offer fair and reasonable products and services to meet governmental missions. The IT Acquisition Center offers assistance with the solicitation process through "Pathway to Success" seminars.

If you want more information, please contact GSA Customer Service at (703) 605-2700, or visit www.gsa.gov/itcenter.  

For information on which Schedule 70 contractors participate in this program, visit the Schedules e-Library at www.gsa.gov/elibrary. For more information on cooperative purchasing, visit www.gsa.gov/cooperativepurchasing.

Benjamin Taylor is a business management specialist and project management professional (PMP) with the General Services Administration's IT Acquisition Center. The Cooperative Purchasing Team provides IT Schedule 70 education and outreach to state and local governments. You can reach him at (703) 605-0523 or .