Posted on Wednesday, September 03, 2008 - 02:39 pm:
I finally signed up for FedBid, after losing out on yet another
I read through FedBid's Terms. FedBid says that they have the authority
to suspend or terminate my FedBid registration and access, and to
determine that my bids are non-compliant.
In effect, any Agency that uses FedBid has delegated to them this
That directly contradicts FAR 7.503(c)(12)(ii).
Why hasn't this been stopped ? Must be waiting for a protest to get the
government back on track.
Posted on Wednesday, September 03, 2008 - 02:57 pm:
brian - you make a very good point. One that I hadn't thought of. I
have received multiple FedBid briefings. My feeling is that why do I
need a middle man (a contractor) to do pre-award functions that I can
accomplish? The last time I checked, performing pre-award functions is
part of my job description. Why should I require vendors/contractors to
pay to register on FedBid and then pay a surcharge to FedBid (which is
then included in their price quote to the Government) to get an order? I
can go directly to GSA or FedBizOps and get the job done in less time.
If I am absolutely made to use FedBid, then I will. Until then (as I
learned in the last briefing I received), it is at the discretion of my
supervisory chain whether it is mandatory or not. I see FedBid as a
direct threat to the 1102 career field. The more work FedBid does, the
less the 1102's have to do, the fewer 1102s are needed. Don't you just
love the First Amendment!!!
Posted on Wednesday, September 03, 2008 - 03:04 pm:
Ummmm, what does the First Amendment have to do with this?
Posted on Wednesday, September 03, 2008 - 03:26 pm:
Grants me the freedom to say what I think!!!
Posted on Wednesday, September 03, 2008 - 03:52 pm:
Oh. Got it.
Posted on Wednesday, September 03, 2008 - 04:05 pm:
Vern - By the way - what do you think about FedBid?
Posted on Wednesday, September 03, 2008 - 04:42 pm:
Believe it or not, I had to look up FAR 7.503(c)(12)(ii). It states:
"...(c) The following is a list of examples of functions considered to
be inherently governmental functions or which shall be treated as such.
This list is not all inclusive:
......(12) In Federal procurement activities with respect to prime
.........(ii) Participating as a voting member on any source selection
I'm not sure how you drew the parallel that FedBid is somehow a voting
member of a source selection board because as a bidder you must
adhere to the terms and conditions of their service. FedBid is merely a
tool the Government can use to solicit SAPs and GSA Schedule buys. It's
not full and open competition... it's not designed to be.
The Government makes vendors submit to offer/quote/bid instructions all
the time, is "you must submit your quote in accordance with the terms of
fedbid.com" really that much more unrealistic than "you must hand
deliver your bid to the Agency Building, 4th Floor, Room 2032 (turn
right after the water cooler)"?
Leo, you said, "Why should I require vendors/contractors to pay to
register on FedBid and then pay a surcharge to FedBid (which is then
included in their price quote to the Government) to get an order? I can
go directly to GSA or FedBizOps and get the job done in less time. "
Just so you know, this is almost the exact arrangement that is set up
under Federal Supply Schedules.
Posted on Thursday, September 04, 2008 - 04:00 am:
I believe that, if FedBid has authority to eliminate my bid from
consideration, with no Government involvement,
then they ARE the Source Selection Authority.
They have been given 100% of the votes on the source selection board.
Most of what I've seen go to FedBid is solicited as an RFQ.
Now, this is a matter of some disagreement, but I believe that an RFQ
means that the Government wants to hear from me (industry) the best way
to acquire services or supplies.
Today, on a requirement for services that will take at least 270 days to
perform, I put in my quote that I wanted the Bid Schedule changed so
that I got paid monthly.
FedBid emailed me to say that my Quote would not be forwarded to the
Government unless I made it conform to the way FedBid solicited it, one
In my limited anecdotal experience, when I show a Government person who
is soliciting for services that the Bid Schedule could be improved to
our mutual benefit, they at least consider my input. With FedBid, they
never see my input.
Maybe only IFB's should get posted there ?
Posted on Thursday, September 04, 2008 - 09:29 am:
brian - Some thoughts with it acknowledged that I am educating myself
It seems that FAR 13-106-2(3) and 13.106-2(4) specifically say
In a read of the specific RFQ are alternative quotes allowed or is the
solicitation silent on this matter? Either way it might be interesting
to submit a quote in direct response with an alternative for
consideration and see how FedBid handles.
What are the protest instructions of FedBid solicitations? If either the
route to GAO or the route to Agency is allowed it would be interesting
to hear the agency response but as we know GAO decisions do carry more
Posted on Thursday, September 04, 2008 - 09:33 am:
Was the RFQ for a commercial item? If so, did the RFQ incorporate the
untailored version of FAR 52.212-1?
Posted on Thursday, September 04, 2008 - 10:12 am:
The Distributed Solutions decision from the Federal Circuit,
discussed elsewhere in wifcon, makes it clear that a rejection of an
offer or quote by FedBid could be protested, at least in the Court of
Posted on Thursday, September 04, 2008 - 12:07 pm:
vbus - Thanks. I was aware of that. Then, why should a vendor be
required to pay GSA for their FSS and then pay FedBid? Again, if I can
go direct to GSA, save the Govt $$$, then why should I use FedBid?
brian - As I understand it, FedBid is required to forward all
solicitation questions to the POC contract specialist for a response.
Did they do this in your case?
Posted on Thursday, September 04, 2008 - 01:08 pm:
that they raise some interesting issues. I've discussed it with a
colleague this morning and we're going to look into it further. I'll let
you know what we come up with.
Posted on Thursday, September 04, 2008 - 04:19 pm:
Thanks. I'll look forward to it.
Posted on Friday, September 05, 2008 - 12:33 am:
I learned of the acquisition after the deadline for questions had
After I put my proposed modified bid schedule in the only space where I
could put any text,
FedBid emailed me to say:
"Please provide a detailed spec sheet of what you are proving
[providing, I think], so that I may forward it to the Buyer.
"Please also remove the pricing from the description field of your bid.
Pricing only goes in the pricing fields.
"Please respond by 09/04/2008 01:30 PM ET, as the buy closes at 2:00 ET,
or steps may be taken to remove your pricing."
Perhaps I could have conveyed the information by running off a spec
sheet, but I didn't.
the acquisition is gone from FedBid. I'll have to look elsewhere.
Posted on Friday, September 05, 2008 - 12:41 am:
gone, Don. Gone.
Posted on Friday, September 05, 2008 - 10:19 am:
In addition to the concerns discussed here, I have additional
concerns regarding the use of FedBid, particularly with an agency
mandating the use of FedBid for its requirements and for using FedBid
for requirements over $25,000.
In some respects, mandating the use of FedBid is steering business to
one particular vendor. A contract between the Agency and FedBid is not
required in order for the agency to use FedBid. FedBid gets a fee/or a
cut of the award amount from the successful vendor. Therefore, mandating
that COs use FedBid could translate into big dollars for FedBid.
While, OMB encourages the use of on-line procurement tools, the FAR does
not mandate the use of any on-line procurement tools, other than
FedBizOpps (or FBO, as it is now known) and FBO is the government point
of entry (GPE) or official site for certain actions. Therefore, I do not
believe that FedBid should be used for any proposed acquisition over the
synopsis requirement threshold of $25,000. As requirements of $25,000 or
more must be posted to FBO, it is a duplication of effort to also post
the solicitation on FedBid.
In order to avoid this duplication, some agencies post, on FBO, a
statement indicating that the official solicitation is on FedBid and
that vendors must go to FedBid to view and submit quotes or offers. It
is my opinion that doing this is inappropriate as it restricts the full
and open competition that FBO is supposed to generate. Also, if an
agency is conducting its acquisitions in this manner, the agency is
mandating that contractors give another business, “business.” Because,
this is, in fact, what's happening.
In order to use FedBid, a vendor must register with FedBid and the
vendor must agree to pay FedBid a percentage of the award should it win
the award. A vendor should have the right to compete fairly in the
marketplace. Requiring a vendor to join another entity, and pay for the
right to compete, unfairly restricts such competition. (NOTE: - I do not
think this equates to the IFF for GSA Schedule holders, as that is a
condition of award, not a condition of making an offer). Right now the
FAR states that FBO is the official place for solicitations, and while
some agencies may direct a vendor to the agency website to download the
solicitation, it is still open competition, because the vendor doesn’t
have to pay for it, join something, or otherwise interact with a 3rd
party just to participate.
Posted on Friday, September 05, 2008 - 10:55 am:
I would add the following to the list of concerns.
formed between the Buyer and FedBid but I wonder if it does not
constitute an "Agreement" under the Federal Grant and Cooperative
Agreements Act? In other words, under what authority is a contracting
The "Anonymity" standards expressed with regard to "Buyers" in the
openness required of the guiding principles of FAR 1.102(b)(3).
With regard to "Incomplete Transactions and Refunds" why are not the
same standards demanded for refunds to a Seller as Fedbid demands for
its "Payments" from a Seller?
Posted on Friday, September 05, 2008 - 11:49 am:
As much as I would love to be filing a Claims Court protest on this
right now, I think a letter to OFPP might be in order. From the comments
it seems clear to me that the FedBid process has some significant
Posted on Friday, September 05, 2008 - 12:17 pm:
Yet... Can it be that GSA has not thought of this? Is there any
chance that the matter has been addressed and we just don't know about
As for a letter to OFPP... Good luck getting a meaningful response
before next fall.
Posted on Friday, September 05, 2008 - 12:57 pm:
Well, that's why I'd just as soon be in court. I was just trying to
not sound like an ambulance chaser. Actually, GSA might have more of a
vested interest in this issue if they see FedBid as a competitor (which
they probably should).
Posted on Friday, September 05, 2008 - 01:50 pm:
I don't think GSA sees FedBid as a competitor. FedBid is on GSA
OMB has addressed the use of commercial online services:
However, I can find no evidence that the issues raised here have been
Posted on Friday, September 05, 2008 - 02:04 pm:
I worked in GSA when the IG was making things very uncomfortable for
GSA's Federal Technology Service (FTS) and GSA began using FedBid to
supplement and in some cases replace some of their acquisition folks.
I'm not sure if it worked or not but surly agree with Leo1102 that
FedBid is a threat to the 1102 career field.
Posted on Friday, September 05, 2008 - 06:19 pm:
The OMB letters from 2004 and 2006 contain, not surprisingly, little
actual policy direction. The problem with this situation is that no one
has enough at stake in any particular procurement to institute a
protest. It seems to me that any non-governmental process that can veto
communication between potential vendors and government buyers has a
number of serious problems and should be challenged in some fashion.
Posted on Saturday, September 06, 2008 - 10:36 am:
So far, the discussion has addressed what people think is (potentially)
wrong in principle. For instance, Brian complained about
latent possibilities, but I haven't yet read of any act by FedBid, or by
an agency in connection with FedBid's service, that is contrary to law
or regulation. And although I have found protests about reverse
auctions, including at least one conductd by FedBid, I haven't found any
that complained about the government's use of services such as FedBid's.
FedBid and other such firms offer a service to agencies through their
GSA FSS contracts. Is there something inherently wrong with such a
reflect the potential to "veto" communication? If there is
nothing inherently wrong, has there been a specific act that was wrong?
If you were going to protest, what would you protest about?
Posted on Monday, September 08, 2008 - 08:50 am:
My office just started using FedBid a few months ago and I tried it
out on a few smaller purchases to see how it worked. I spoke with the
vendors and they did not like that system because it imposed higher fees
than GSA did on awards, plus they were on top of the GSA fees, which
basically increased the cost for GSA contractors to compete with open
That is my limited experience, but it was enough to push me away from
FedBid for all of my purchases except those that cannot be found in GSA
schedules. I have not found that much of that, so I am sticking with the
GSA eBuy system nearly all of the time.
As far as protests go, I would think that if FedBid is used as it was
advertised for restricting competition, it may be a candidate for a
protest. If FedBid RFQ's are directed to GSA, fees are due to both GSA
and FedBid, and if GSA contractors are mixed in with open market
contractors, the GSA vendors are at a .75% disadvantage right off the
I don't know about the other issues such as blocking communication with
the CS or CO, I put my contact information right into the RFQ so they
would not have been able to stop it in my case.
Posted on Monday, September 08, 2008 - 02:53 pm:
I don't want to sound like a big proponent of FedBid, but I certainly
don't share the same opinion that FedBid is taking away acquisition
work, that it's a competitor to GSA's Federal Supply Schedules, or that
it's a "threat" to the 1102 career field. A CO does not "give" their
acquisition to FedBid to solicit for them... a CO uses FedBid's online
technology for administrative convenience and to enhance competition.
which offerors must comply. All FedBid buys are commercial, and FedBid
allows the CO to choose whether he or she will conduct the acquisition
in accordance with FAR 13 or FAR 8.4 (or IAW other listed GWAC/BPA terms
and conditions, such as SEWP). CO's are given a lot of latitude to
solicit commercial items using SAPs or to issue FSS orders. Soliciting
through FedBid is NOT designed to be full and open competition. Although
there are several references to "bids" and "IFBs", FedBid buys are NOT
FAR Part 14 acquisitions. See here:
It doesn't surprise me that a vendor does not like to pay the FedBid
fee. But I would assume vendors would pass that cost on to the
Government in the total price of their offers.
It shouldn't be a surprise that agencies like to use FedBid. The reverse
auction process seems to decrease overall prices. And FedBid's
interface allows CO's to instantly print and document the competition
they received. Also, the amount of effort to post a FedBid buy is
minimal. When you have completed entering in your solicitation
information, FedBid can automatically post your solicitation to FBO or
GSA e-Buy. A CO/CS doesn't do both entries themselves.
Again, I'm not 100% sold on FedBid. As for potential protests, look back
to don_acquisition's question, "Did the RFQ incorporate the untailored
version of FAR 52.212-1?" Any open market FedBid buy would/should
include this provision. In Brian's case, FedBid told him his offer would
be rejected for submitting an alternate payment schedule. It could be
argued that alternate offers are allowed in accordance with FAR
52.212-1(e) and that FedBid has no authority to reject it.
Posted on Monday, September 08, 2008 - 03:34 pm:
Your questions in your post last Saturday (9/6) are valid ones. One of
my pet peeves is the "it's illegal" response to anything. If you can't
cite a specific section of statute or regulation, ain't nothing
"illegal." So the questions deserve an answer, but ones that require
some research. So I'll have to get back to you.
Posted on Monday, September 08, 2008 - 04:48 pm:
Posted on Tuesday, September 09, 2008 - 08:51 am:
vbus - Still learning so posing this question.
You state: "It doesn't surprise me that a vendor does not like to pay
the FedBid fee. But I would assume vendors would pass that cost on to
the Government in the total price of their offers."
transaction fee on the "bid price" that is sent from the Seller through
Fedbid to the Buyer.
Is your statement to mean that the Seller inflates their own pricing to
cover the transaction fee and that Fedbid then adds the fee, in other
words the fee is in the final "bid" price given to the Buyer twice?
Fedbid adding the fee to a Sellers pricing puts Fedbid in the position
of being the prime as they are controlling price to the Government.
Posted on Tuesday, September 09, 2008 - 08:58 am:
One thing that you may not be aware of is the fact that FedBid
representatives have offered to input RFQ's into the system as a free
service to contracting offices. They would receive copies of the
purchase requests, input that data into a RFQ in FedBid, and save the
RFQ's in the buyers folder as a draft document. All the 1102 would do is
post the opportunity.
That to me is somewhat of a shift of workload, but probably not as
significant as some might think. My office did not accept FedBids offer
to take on that work, so I do not have any evidence on how much work
that would involve.
Posted on Wednesday, September 10, 2008 - 03:27 pm:
You asked: "Is your statement to mean that the Seller inflates their own
pricing to cover the transaction fee and that Fedbid then adds the fee,
in other words the fee is in the final "bid" price given to the Buyer
No, sorry, that's not what I meant to imply. Rather that a vendor
wouldn't submit a bid without considering the cost of paying FedBid's
fee, and that a seller would certainly feel that they were being forced
to pay something they would otherwise have to if responding to a
solicitation on FedBizOpps.
Having not performed the seller's function of submitting a bid, I can
only go by what I read, but your description sounds accurate in that a
vendor enters their bid price and then before its official bid that the
buyer can accept, FedBid adds on their "Proportional Transaction Fee".
So: Seller's Bid Price + "Transaction Fee" = FedBid price. (Note
that the "Transaction Fee" is a percentage of the seller's bid
dwgerard, no I did not know FedBid was offering to input buys for
agencies. I'm not sure I see the harm in FedBid just doing the data
entry, especially if the CO is the one who must go in and release the
buy. Important to note, FedBid requires vendors to submit their bids as
offers and not quotes.
Posted on Friday, September 12, 2008 - 05:25 pm:
This is in response to your post #1046 (Saturday, September 6, 10:36am).
After looking at GAO and Court of Federal Claims cases that discuss
the underlying structure can be challenged. FedBid appears to be set up
primarily for reverse auctions, although they do have a mechanism for
limiting sellers to one bid. I’m not particularly impressed by the
reverse auction concept. It seems like more trouble than it’s worth.
In any event, FedBid has some curious aspects. It is rather obvious why
it may be difficult to communicate with the CO. Buyers can have
anonymity, except to the selected seller (duh!).
All solicitations are referred to as IFBs. Perhaps not technically
correct in FAR terms, but appropriately suggestive I think. IFBs have to
be limited to Commercial Items. All Orders placed as a result of an IFB
current terms as provided by the Buyer, and the mutually agreed
commercial terms and conditions of the Selected Seller for the items
being competed.” Interesting to consider if the “applicable FAR” and the
terms provided by the Buyer conflict, what are the applicable terms and
conditions? Is FedBid extending the Christian Doctrine? Also, under the
FedBid procedures which really do not permit modification to the IFB,
how can there ever be “mutually agreed commercial terms and conditions
of the Selected Seller”? The seller can create a FedBid profile that
might include proposed additional terms, but I don’t know how there can
be an opportunity to “mutually agree” to anything because the seller
must provide unconditional quotes.
right to deny access to the service in its sole discretion. If an agency
uses FedBid exclusively for some procurements, vendors can be excluded
from competing solely upon FedBid’s decision. Another troubling aspect
may subject the seller to negative ratings from FedBid users and could
lead to suspension or revocation of some or all of the seller’s FedBid
license privileges. Sounds like a private (i.e., non-governmental)
debarment process to me. Given the exhaustive disclaimers of FedBid
liability, I think it would be problematic as to how a seller could
challenge FedBid’s unilateral and discretionary actions.
Another troubling aspect of the FedBid process is the Performance Alert
process. Buyers who experience “materially problematic performance issue
with a Selected Seller” may submit a Performance Alert. The Performance
Alert “contains no performance information or subjective content and
simply authorizes FedBid to make the Buyer’s contact information
available to the Flagged Seller and to other Buyers considering the
Flagged Seller as a Selected Seller.” The “Flagged” seller knows which
Buyer submitted the Performance Alert, but it is entirely up to the
buyer and seller to resolve the Alert. It appears that the Alert stays
on the seller’s record (at least for 18 months) at the discretion of the
Buyer. It appears that a seller is not notified when a prospective Buyer
contacts the Buyer that submitted the Alert. In the absence of mutual
agreement on removal of the Alert, the Buyer appears to have no remedy
short of federal district court. (It doesn’t seem likely that the Court
of Federal Claims or the Boards of Contract Appeals would have
jurisdiction in the absence of a contract.) I think it is likely that
prospective Buyers would not check on the basis for the Alert, but just
perceive it as evidence of bad past performance. Again, this sounds like
a private (i.e., non-governmental) past performance process.
If there is an ambiguity or other problem with the IFB, the seller has a
government Buys, FedBid will provide to any Seller, upon such Seller’s
request, a Buyer point of contact for purposes of filing a bid protest
or other dispute with the associated Buyer.”
For the seller, putting all of this together, it would feel like being
nibbled to death by ducks. It is unlikely that there will be one problem
that is so significant (and probably no single IFB so major) that buyers
are going to be motivated to challenge the situation. If there is a
challenge, I would expect it to come from Fedbid’s unilateral denial of
access to the system or from the actual application of the Performance
Alert process. Finding a forum for a challenge will not be a simple
Posted on Saturday, September 13, 2008 - 02:07 pm:
Good afternoon, great discussion; however, much of it is predicated
on misunderstandings regarding FedBid’s offering, so please read the
following responses, and if you have further questions, please do not
hesitate to email or call. Sellers/Industry should contact Geoff
Edwards, at 703-738-6866 or
email@example.com; Buyers/Government should contact John Lee,
at 703-738-6858 or
firstname.lastname@example.org. Lawyers, feel free to contact me, Luther
Tupponce, at 703-738-6886 or
FedBid is simply one of many commercially available acquisition tools
that can be used by buyers to make commodity buying more efficient by
improving the competitive process. FedBid automates the notification,
competition and documentation stages of a commodity procurement,
enabling buyers to achieve significant savings (nearly 15% NET savings
on average) and dramatically improve productivity, transparency and
documentation. In the case of federal buyers, FedBid is also extremely
effective at helping agencies meet and exceed their socio-economic
goals. In fact, approximately 80% of all dollars competed through FedBid
were awarded to small businesses.
As The Buyer-Driven Online Marketplace, the buyer (contracting officer,
in the case of a federal agency) controls decision-making regarding all
material aspects of the commodity buy process. These determinations
include: whether to use FedBid for a particular procurement; development
and content of the requirements and solicitation related documentation
(IGE, J&A, etc.); appropriate acquisition scenario, including contract
vehicle and set-aside; the timing and length of the buy; basis for
award; applicable terms; use of FBO; due diligence and award. FedBid
makes no decisions on behalf of the Buyer, and in particular, FedBid
definitely does not make award determinations.
Please see below for a list of responses to the issues that have been
raised - all of which could have been answered with a simple phone call
or email to us or by reviewing the site at
• FedBid’s authority to suspend / terminate account access is
delegation of contracting authority (reference to Distributed Solutions
decision) Distributed Solutions dealt with the government’s decision to
task a prime contractor with awarding subcontracts.} FedBid is not a
prime contractor and sellers are not subcontractors to FedBid. Moreover,
FedBid does not make award decisions; rather, the buyer makes award to
the seller based on information communicated by the buyer through the
governing use of the marketplace, and FedBid assumes responsibility for
marketplace integrity. Because this is a real-time competitive
environment, each seller’s bid may affect the bids of other sellers.
Accordingly, during a buy, FedBid may remove bids that do not comply
with the solicitation requirements (e.g., a seller bids on a GSA
Schedule buy, when that seller is neither a schedule holder nor has
authority to bid another company’s schedule).
• FedBid acts as a middle man (a contractor) to do pre-award
functions that the buyer can accomplish.} FedBid does not displace
the buyer’s obligations to perform pre-award functions, including
performing due diligence on competitive bids, as buyer would otherwise
perform in an offline process. FedBid simply automates the notification,
competition and documentation stages of the procurement process,
providing process efficiencies while ensuring maximum, transparent
competition. This allows buyers to reduce the time and energy spent on
commodity buying and spend more time on complex buys that require
greater application of their procurement expertise.
• Why should I require vendors/contractors to pay to register on
FedBid and then pay a surcharge to FedBid (which is then included in
their price quote to the Government) to get an order? FedBid sellers
incur no out-of-pocket fees to use FedBid. In fact, FedBid is completely
free for both buyers and sellers to register, create or view buys, and
place and review bids. The fee is an equal percentage transactional fee
added to each bid so that the buyer can make a true apples-to-apples
comparison between the IGE and the bids received. Based on their
determination of success, a buyer can cancel the buy and incur no cost
or accept the buy and pay the bid amount, including the fee, to the
selected seller. FedBid then collects the fee from the selected seller.
With respect to buyers, on average FedBid saves buyers nearly 15%, and
that amount includes the FedBid Fee.
• It almost seems by Fedbid adding the fee to a Sellers pricing puts
Fedbid in the position of being the prime as they are controlling price
to the Government.} The FedBid Fee is equivalent to a credit card
fee. It is a transactional fee that is automatically included in each
bid and collected only from the selected seller after the buyer accepts
the bid and pays the total bid amount to the seller. There is no prime
contract between FedBid and the buyer under which FedBid subcontracts
with seller; nor do buyers issue orders to FedBid. All orders are issued
directly to the selected seller based on the buyer’s award
• I can go directly to GSA or FedBizOps and get the job done in less
time. FedBid is not replacement for GSA Schedules or FBO; FedBid
works in conjunction with GSA Schedules and FBO to provide further
efficiencies and an improved competitive process. If a buyer needs to
post to FBO, FedBid provides automated data feed capability so that the
combined synopsis/solicitation is automatically posted to FBO without
work duplication. FedBid also enables buyers to achieve significant
efficiencies, documentation, competition and further savings on Schedule
buys by begin able to require all sellers to submit Schedule based bids.
Schedule buys competed through FedBid consistently provide pricing at
lower than Schedule pricing because FedBid provides a dynamic online
marketplace allowing sellers to submit multiple real-time bids in an
automated, transparent, documented, auditable process. This distinction
in capability and approach is essential to understand, as the
government’s ability to obtain active competition in the reverse auction
process is what delivers much of the cost savings realized on the FedBid
• RFQ v. IFB FedBid is not a quote-based system; it is an
offer-based system, which is necessary to maintain the integrity of the
• What are protest instructions? For federal buys, protests are
conducted by the seller directly through to the agency or GAO, as
required by the FAR. FedBid does not accept protests and does not act as
a platform for protests.
• FedBid doesn’t accept seller input regarding solicitation
language/requirements. As previously mentioned, all decisions
regarding the solicitation and requirement are the buyer’s to make. This
includes the decision by the buyer to designate FedBid as the POC or to
include their own or someone else’s information in the solicitation. In
any case, FedBid submits all non-FedBid related questions and comments
(e.g., suggestions, recommendations, clarifications regarding the
solicitation) to the buyer for buyer response; however, pursuant to FAR
13.106-1, buyers have considerable discretion to respond or not to
respond. Buyers using FedBid actually do respond to seller input, as
demonstrated by the substantial number of reposts (amendments) in order
to clarify bid specs, etc. for competed commodity buys. Significantly,
buyer response through FedBid provides standard, consistent
communication to all sellers in order to maintain a fair and level
playing field throughout the competitive process.
• Are alternative [bids] allowed? Buyers may solicit ‘Exact
Match’, ‘Brand Name or Equal’ or ‘Meet or Exceed’ requirements. Under
the latter two scenarios, sellers may choose to submit alternative spec
bids under multiple user names. However, in order to maintain the
integrity of the marketplace and ensure that all bidders are competing
on a level playing field, offline bids are not permitted.
• FedBid should [not] be used for any proposed acquisition over the
synopsis requirement threshold of $25,000. As requirements of $25,000 or
more must be posted to FBO, it is a duplication of effort to also post
the solicitation on FedBid. As previously mentioned, if a buyer
needs to post to FBO, FedBid provides automated data feed capability so
that the combined synopsis/solicitation is automatically posted to FBO
without work duplication.
• A vendor should have the right to compete fairly in the
marketplace. Requiring a vendor to join another entity, and pay for the
right to compete, unfairly restricts such competition. As previously
mentioned, Sellers access and use FedBid without incurring out-of-pocket
costs. Registration occurs one time, takes approximately 10 minutes, and
approval is based simply on CCR registration and non-inclusion in the
EPLS. Rather than restrict competition, FedBid helps maximize
competition for commodity and simple service acquisitions, which are
most suitable for competitive procurements and small business
participation. With automated FBO postings and centralized push
notifications of competitive procurement opportunities based on
self-selected seller profiles, FedBid increases seller participation,
and eliminates the informational disadvantage faced by small businesses
that cannot afford additional personnel to target, track, and sell
company products and services. The result is a marketplace that reduces
cost and increases speed of sales, increases market awareness, levels
the playing field, maximizes competition and encourages participation by
large numbers of sellers, most of which are small businesses. In
addition to the general notice provided to the entire seller community
through FBO postings, FedBid averages nearly 1,500 direct push
notifications to sellers per buy. Excluding the thousands of
contract-specific (e.g., SEWP, FirstSource, Schedule, etc.) and
set-aside buys, that average expands by thousands. Moreover, small
business have been awarded approximately 80% of the dollars competed
through FedBid. OFPP fully supports online reverse auctions, has
examined the issue thoroughly at the request of Congress through its
reverse auction working group and has included it in their list of best
practices for increasing competition (see the posting at
• The "Anonymity" standards expressed with regard to "Buyers" in the
openness required of the guiding principles of FAR 1.102(b)(3).
FedBid is a buyer-driven online marketplace. The buyer makes all
decisions regarding the procurement, including whether or not to
publicize a point of contact other than FedBid. Publication occurs in 2
instances: 1) when the buyer opts to publicize the information, or 2)
when the buyer posts the FedBid solicitation to FedBizOpps, which FedBid
accomplishes for the buyer in an extremely efficient manner by using an
automated data feed from FedBid to FBO. If the buyer chooses not to
publicize a point of contact other than FedBid, FedBid acts as the
primary point of contact. Acting as the primary point of contact for the
buyer, at their option, is simply another way that FedBid helps
streamline the acquisition process for the agency, allowing the
government to be more productive with fewer resources. This service is
not prohibited by the FAR, it is specifically permitted by all agency
agreements with FedBid, and it is consistently cited by our agency
customers – in addition to increasing competition, savings, efficiency
and small business utilization – as one of the many advantages of using
FedBid. Moreover, FedBid’s services are not unusual, with equivalent
situations extant, for example, when agencies use GSA to facilitate
their procurements or when agencies employ contract specialists,
including contractors, to help facilitate the traditional procurement
process. Contrary to assertions that FedBid’s role interferes with
communication, we ensure that the buyer receives all non-FedBid related
questions, and it is up to the buyer at that point to determine whether
and how to respond.
• FedBid is a threat to the 1102 career field. Although change is
often difficult, including change in the procurement field, 1102s use
FedBid to increase their effectiveness and productivity for competing
commodity buys. They are able to perform the tasks least dependent on
their expertise (notification, competition, documentation) in a much
more efficient and effective manner and spend more time on preparing
accurate solicitations, performing due diligence and making intelligent
award decisions. In addition, they can focus their energy on more
complex service buys, which require a much greater level of expertise
and time. John Ely has written a great article in Contract Magazine
regarding the effects of the online marketplace on the 1102 community,
which we posted with NCMA’s permission at
• I spoke with the vendors and they did not like that system because
it imposed higher fees than GSA did on awards, plus they were on top of
the GSA fees, which basically increased the cost for GSA contractors to
compete with open market vendors. Sellers access and use FedBid
without incurring out-of-pocket costs. The fee is applied proportionally
to all bids and have absolutely no impact on bid price ranking. In
addition, FedBid pays the IFF on the FedBid Fee portion of all awards
http://www.fedbid.com/sellers/faq/#anchor33). If FedBid receives
notice that, due to inclusion of the FedBid Fee, the Selected Bid’s line
item pricing is higher than the Selected Seller’s applicable published
government contract pricing, the FedBid Fee will be reduced to ensure
the Selected Bid’s line item pricing does not exceed the Selected
Seller’s applicable contract pricing
http://www.fedbid.com/sellers/faq/#anchor34). Buyers often use
FedBid for GSA and other contract buys because the dynamic competition
on the marketplace enables them to achieve significant savings off of
the published contract pricing.
We'll continue to respond to questions on this board as quickly as
possible, but, again, calls or direct emails to FedBid are welcomed. All
of these issues have been asked and answered over the past 7 years more
times than I can count, but we're happy to continue to respond to any
Sr. VP and General Counsel
Posted on Saturday, September 13, 2008 - 02:27 pm:
In response to your issue with the FedBid ActivityCard and Performance
Alert, please review the article I wrote for Contract Management
006.pdf. We continue to work to help bring commercial best practices
into the federal procurement arena.
Posted on Saturday, September 13, 2008 - 02:46 pm:
This is very interesting. I plan to address the issues in The Nash
& Cibinic Report later this year.
Posted on Saturday, September 13, 2008 - 03:48 pm:
Vern, we would appreciate the opportunity to provide input regarding
any issues you might choose to address. Feel free to drop me an email at
Posted on Saturday, September 13, 2008 - 04:00 pm:
Thank you, Lu.
Posted on Sunday, September 14, 2008 - 12:49 am:
Well, Lu, if I understood you correctly, you answered one question I
never even thought to ask before:
I saw that you added a consistent 3% to every CLIN of every bid I've
made through your portal,
and I wondered if someone with an established track record of selling
through you got a better (lower) markup.
You seem to be saying that,
except in cases where adding your markup pushes a FSS schedule holder's
prices over his schedule prices,
then you hit everyone with the same 3%.
Did I understand that correctly ?
Posted on Sunday, September 14, 2008 - 05:37 pm:
Everyone gets the same percentage fee added - even for schedule buys -
so that the buyer is comparing bids on a consistent basis. If we need to
lower our fee to keep the selected seller's price at or below their
schedule price, we'll make that adjustment once we are notified by the
buyer or selected seller and we confirm the information. We do not apply
different fees to different sellers because varying fees would clearly
eliminate our marketplace neutrality. Also, our fee arrangement is with
the buyer rather than the seller.
Let me know if this answers your question.
Posted on Monday, September 15, 2008 - 01:55 pm:
Lu, what's the basis for your statement that "With respect to buyers,
on average FedBid saves buyers nearly 15%, and that amount includes the
FedBid Fee?" Have you done studies that prove this, or commissioned
them? Or, have some participating contracting activities done so? Have
the reputed savings been based on comparisons of FedBid results to
historical bids? to projected bids? If they were based on projected
bids, how were the projections made (what was the basis therefor?)
Posted on Monday, September 15, 2008 - 02:42 pm:
Do you believe FedBid's standard 3% fee meets the definition of a
“Contingent fee” as defined at FAR 3.401:
“Contingent fee” means any commission, percentage, brokerage, or
other fee that is contingent upon the success that a person or concern
has in securing a Government contract.
Posted on Monday, September 15, 2008 - 09:54 pm:
Hi Redryder, the savings is calculated on the difference between the
IGE, as determined by the buyer, and the awarded price, which includes
Vbus, FAR 3.4 (issued pursuant to 10 U.S.C. 2306(b) and 41 U.S.C.
254(a)) deals with employees or agents of a contractor that receive a
fee contingent upon the contractor successfully securing a government
contract. The code and related FAR provision were created to help reduce
the potential of agents or employees using improper influence to obtain
government contracts. Significantly, FAR 3.4 and the related governing
code provisions apply neither to the acquisition of commercial items
(See FAR 12.5 et seq.; FAR 3.4; 10 U.S.C. 2306(b); 41 U.S.C. 254(a)) nor
to acquisitions conducted pursuant to the simplified acquisition
provisions of FAR 13 (See FAR 13.005; FAR 3.4; 10 U.S.C. 2306(b); 41
U.S.C. 254(a)), regardless of whether such acquisitions are made through
prime or subcontracts.
specifically address the issue of improper influence, first, by making
clear in its introductory statement is not an employee or agent of any
seller, but an independent marketplace. The Terms state that “The Web
Site is an Independent Venue for Buyers and Sellers to exchange
Information and to establish an electronic marketplace for Commercial
Items. FedBid does not endorse or approve of any particular Commercial
Items, or any particular Buyer or Seller”. This statement is reiterated
under the section titled, “FedBid Is Only a Venue; Limitation of
Liability and Relationship”, which provides that “[t]he Web Site
provides an Independent Venue for Sellers to offer and sell Commercial
Items and for Buyers to post IFBs and purchase Commercial Items from
Sellers” and, again, under the section titled “No Agency”, which states
“You and FedBid are independent contractors, and no agency, partnership,
joint venture, employee-employer or franchiser-franchisee relationship
referenced, above, as “an established commercial entity that neither
exerts nor proposes to exert influence to solicit or obtain contracts
for the Commercial Items solicited by Buyers or offered by Sellers
through the Web Site” and the term “Commercial Items” as “products or
simple services, typically as defined in the FAR at 48 CFR 2.101,
solicited by Buyers from Sellers on the Web Site.” The use of FedBid,
therefore, clearly falls outside of the purview of FAR 3.4 and any
related U.S. Code section, whether such use is by government or
commercial buyers or sellers. FedBid is neither an agent nor an employee
of any seller, but an independent online marketplace facilitating
commercial item acquisitions pursuant to FAR Parts 12, and, except for
Schedule and other exceptional government procurements, FAR Part 13.
FAR 3.4 is also inapplicable on its face because the FedBid Fee is not a
“Contingent fee” as defined in FAR 3.401. FAR 3.401 defines “Contingent
fee” as “any commission, percentage brokerage, or other fee that is
contingent upon the success that a person or concern has in securing a
Government contract.” As made clear in both FAR 3.4 and related U.S.
Code sections, the contingent fee would be paid by the contractor/seller
to the sales agent that the contractor had employed or retained for
purposes of soliciting or obtaining the contract – thus, the concern
regarding improper influence. In addition to the fact that FedBid is a
seller neutral marketplace (see above), the FedBid Fee, as made clear in
proportional percentage of all Bids to the Buyer, and is set by
agreement between the Buyer (agency) and FedBid. The Buyer pays the
FedBid Fee to the Selected Seller, and FedBid invoices the Selected
Seller for the fee amount. Accordingly, it is the Buyer that pays the
FedBid Fee and NOT the contractor/Seller, although FedBid does collect
that fee amount from the Selected Seller.