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Does it pay to be part of the GSA STARS II club? So far, not so much.

Posted By Guy Timberlake, The American Small Business Coalition, LLC, Wednesday, March 27, 2013

Generally speaking, the consensus throughout the government contracting community regarding contract vehicles, is that it's better to have one than not. Generally speaking.

So what happens when a vehicle like GSA STARS II, one of the superstars of the GWAC circuit, takes a beating at the hands of buying methods that on paper, requires a more involved process than would a buy on STARS II?

After all, when you break down the acronym, "streamlined" is what STARS II is all about.

In a previous entry to the Visionary's blog, I talked about how much business was awarded under STARS II in FY12 and this fiscal year, also focusing on how much was awarded away from that vehicle. In particular, I highlighted how much business the government did under the four NAICS Codes (541511/12/13/19) that represent the four functional areas of the STARS II contract where agencies used definitive contracts and purchase orders that are indicative of buys not made against an established contract vehicle.

Why is this significant? When you are awarded a vehicle like STARS II you become part of a defined group of companies eligible to participate in any of the business opportunities that come across the proverbial transom. What makes STARS II even more unique is the ability to take down opportunities using the sole-source benefits associated with the SBA 8(a) Business Development Program. One of the benefits of that is limited competition. Another is easier market research since you already know who the players are.

But for whatever reason, it doesn't seem that agencies are reaching for the STARS as often as they could. 

In FY12, GSA reported STARS II receiving $344M in task orders, while government-wide, awards under the same four NAICS Codes totaled $4.4B in competitive and non-competitive awards. The part that gets me is the break down of awards based on STARS II contract holders doing business on and off of STARS II.

Of course I have numbers for you.

  • FY13 YTD, GSA reports just over $86M in task orders awarded under STARS II.
  • FPDS-NG reports $7.5B in competitive and non-competitive awards YTD under the four NAICS Codes that are the STARS II functional areas.
  • When looking only at competitive awards issued as a definitive contract or purchase order (same four NAICS Codes), agencies ring the bell at $766M YTD. Keep in mind this is the "hard way" of making these buys as compared to using STARS II and similar vehicles.
  • $119M of these buys were competitive 8(a) awards
  • $3.6M was competitively awarded to 8(a) joint ventures
  • STARS II contract holders scored $44M of the competitive 8(a) awards

Of the 405 large and small companies receiving these competitive awards, only sixty (60) STARS II contract holders scored wins, essentially ten percent of the companies that received the STARS II contract. Can anyone say Pareto Principle?

What this also shows me is that all of the 8(a) companies who felt shut out by not getting a STARS II award, shouldn't feel too sorry for themselves as they actually fared better without STARS II, at least on the competitive side. Even adding the $44M won by STARS II contract holders to the $86M actually awarded against STARS II, the non-STARS II 8(a)'s did pretty good.

For the record, GSA Alliant SB which operates under the NAICS Code of 541512 (one of those shared with STARS II) and has one-tenth the contractor population of STARS II, has tallied $203M in task orders YTD.

In the long run, I'm sure we'll see the tables turn and a lot more of this business go the way of GSA STARS II. Right?

Peace.

The Chief Visionary
www.theasbc.org/visionary

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

 
 

Tags:  8(a)  definitive contract  GWAC  purchase order 

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