The prices in your offer become the prices in your contract, often for years. Getting them right matters more than any other part of the application.
What GSA wants to see
GSA must decide that your prices are "fair and reasonable." Its main tools are your own commercial pricing, comparisons to other schedule contracts, and, for labor, published rate data.
Commercial sales practices (CSP)
You disclose how you sell commercially: your price list, the discounts you give different customers, your payment terms, and any other concessions. The disclosure needs to be complete and internally consistent. Gaps here can later be treated as compliance problems.
Most Favored Customer (MFC)
GSA generally expects that the government receives your best price, or something very close, for comparable purchases. To prove it, you supply sample invoices. You also identify a tracking customer whose pricing relationship to the government's is maintained over the life of the contract.
The price reductions clause
If your pricing to the tracking customer improves relative to the government's, you must reduce the schedule price and notify GSA within the timeframe the contract specifies. Firms that ignore this can face audits and repayments. Good record keeping from day one prevents trouble.
Negotiating well
- Lead with justification. Explain differences in your offering that support higher prices than comparable contracts, such as certifications, scope, or quality.
- Know your floor. Decide in advance what prices still leave a profit after the 0.75% IFF and your costs.
- Remember it is a ceiling. Schedule prices are maximums. You can always quote lower on a specific order, so do not give away margin you do not have to.
- Plan for escalation. Choose a defensible economic price adjustment method for the out years.
Products vs. services
Products are priced by item with discounts from a published price list. Services are priced by labor category and hourly rate, supported by an invoice per category and a compensation plan. Each has different pitfalls, and we handle both in our package.