Beat your competition:
- Recipe for Success: Competitive prices drive success;
- Challenge: Maintaining a competitive edge with a large number of products is challenging;
- Solution: Price Reporter has the solution.
See how your prices rank against other vendors on GSA Advantage in just a few clicks.
Find out if your prices compete well on the federal market
Your pricing strategy is one of the crucial factors determining if you’ll succeed or fail doing business with the government. Your prices must be competitive in comparison to other contract holders while still being advantageous to your company. And if your GSA price list contains thousands of items, maintaining a competitive edge with all of the products quickly becomes challenging to say the least.
Price Reporter offers a simple GSA pricing tool to quickly estimate how well you are doing against your competitors. Surely, GSA Advantage allows viewing GSA prices online, but when it comes to comparing a lot of contracts and SINs, you need a better tool.
How to build your GSA pricing strategy
The GSA pricing policy implies that a vendor must offer the best price to the government. Specifically, you should offer to GSA at least the same or better prices that you do to your Most Favored Customer (MFC). Unfortunately, this clause is often interpreted as “the lowest possible price”. Wrong!
The problem with just providing a bigger discount to GSA is that you can easily render your entire business with the government non-profitable. Hundreds of companies have fall victims to this Catch-22: you must offer low prices to win the bid, but by offering low prices you undermine your own business making the whole bid-and-win process pointless. Surely, lower prices for federal agencies mean savings for the American taxpayers. But chasing the lowest bid for the only sake of staying the lowest is not the way your business will prosper.
In fact, the proper approach to setting your GSA contract rates is… to not look at other’s prices! Well, not from the beginning. The fact is: you don’t know the structure of your competitor’s prices. You do not know their direct and indirect costs, including labour costs, materials, transport, and other rates. Hence, trying to beat their bids straight forward has no chance to succeed.
GSA pricing schedule
The better option to complete your GSA pricing list is to evaluate your own rates and costs then surplus your desirable profits. Then, you can research for current or past bids using GSA Advantage, USASpending.gov or govspend.com tools, and see if you can compete without going broke, and meet the requirements of GSA. You can also use the GSA Integrated Competition Tool for that.
Also, remember that bidding the lowest is only a half-way to secure a contract. Whenever you respond to an RFQ, later you will have to provide evidence in the form of Price Narrative and Price Proposal documents.