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092673 1 (1969-12-23)

handle is hein.gao/gaobacwnn0001 and id is 1 raw text is: UNITED STATES GENERAL ACCOUNTING OFFICE WASHINGTON, D.C. 20548 CIVIL DIVISION December 23, 1969 Dear Mr. Spangler: This letter is to inform you that we have completed our review of the policies and procedures of the Federal Supply Service pertaining to the procurement of security file cabinets for the Federal Government. Our re- view considered mainly the feasibility of competitive award alternatives to the negotiated, indefinite quantity, multiple-award Federal Supply Schedule contracts that have been used by FSS for the procurement of cabinets. For several years, FSS procurement officials and internal auditors have been concerned with the reasonableness of cabinet prices. Efforts to obtain more favorable prices have been hampered because (1) cabinets are manufactured for the exclusive use of Federal agencies and their contrac- tors, (2) the number of suppliers qualified to produce cabinets for the Government has been somewhat limited, and (3) FSS is concerned with main- taining a continuing supply of qualified cabinet products. In discussions with FSS procurement representatives, we have suggested that FSS attempt to obtain more favorable prices for cabinets available from more than one supplier, by seeking to make use of a competitive system of contracting. FSS has attempted to foster such competition by periodical- ly reducing the maximum order limitation in the Schedule and thereby in- creasing the number of definite quantity contracts. We believe that there are additional opportunities for GSA to increase its purchases under competi- tive procedures. For example, in 1967, FSS adopted a zonal basis of contracting for cabinets but also continued to contract on a multiple-award basis. In our opinion, the award of competitive contracts on a zonal basis could serve both to reduce prices and to alleviate the concern for maintaining a continu- ing supply of qualified products. Competitive zonal contracting would offer existing suppliers several opportunities to obtain contracts, and at the same time, might attract additional firms to compete for the Government's cabinet requirements. Even with a concerted effort to maximize the use of competitive contract- ing for cabinets, negotiated contracts are necessary for those cabinet models

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