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Federal agencies plan to start buying in bulk

By Ed O'Keefe

It seems the federal government didn't realize until recently that you can save more money by buying in bulk.

Federal agencies will band together as one big customer for future purchases of goods and services, including office supplies and furniture, administration officials announced Wednesday.

"The United States federal government is the world’s largest purchaser, but currently, we aren’t acting like it," Office of Management and Budget Director Peter R. Orszag wrote in his blog this morning. "Agency spending is typically fragmented across multiple departments, programs, and functions. As a result, the federal government acts more like scores of unrelated medium-sized businesses rather than the world’s largest purchaser, and agencies often rely on hundreds of separate contracts for many commonly used items, with prices that vary widely."

Those contracts are called Blanket Purchase Agreements, and though agencies previously had their own BPAs with contractors, the General Services Administration (the government's purchasing agency) has established 12 new BPAs that will apply across every federal agency.

"Now every federal employee who buys office supplies from the winning contractors will automatically get the better prices GSA negotiated," Orszag said. The government should save about $200 million in the next four years on office supply purchases, he said.

Dan Gordon, head of the Office of Federal Procurement, will further explain the plans at a Senate subcommittee hearing on interagency contracts Wednesday afternoon.

Most of the plans Gordon will outline mirror recommendations issued in a Government Accountability Office report on interagency contracts requested by Sen. Claire McCaskill (D-Mo.), who chairs the subcommittee on government contracting.

The new bulk purchasing plans are part of a growing list of cost savings plans announced by the Obama administration in recent weeks, including plans to end improper payments to delinquent contractors and dead people and new orders to cut $8 billion in federal building costs in the next two years.

Here are the 12 companies awarded new BPAs -- all but Office Depot are considered a veteran-owned business or small business:

Capitol Supply Inc., Sunrise, Fla.

Document Imaging Dimensions, Yorkville, Ill.

Independent Stationers Inc., Indianapolis

Metro Office Products LLC, Brentwood, Tenn.

Shelby Distribution Inc., Irvine, Calif.

SITA Business Systems Inc., Chantilly, Va.

WECSYS LLC, Brooklyn Park, Minn.

EZ Print Supplies Inc., Granada Hills, Calif.

Office Depot

ASE Direct Inc., Franklin, Tenn.

Cartridge Savers Inc., Madison, Wis.

New York Inkjet LLC, Baldwin, N.Y.

Leave your thoughts in the comments section below

By Ed O'Keefe  | June 30, 2010; 9:30 AM ET
Categories:  Agencies and Departments, Contracting  
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The government buys as it is directed by congress. It's always funny to me when a congressperson tries to find a cheaper way to do things without encroaching on their own constituents. As a government card holder, I try to buy cheaply to save our office money, after all, I'm a taxpayer, too; but the rules say to buy from different places each time, to spread the money around, NOT find the cheapest place. Read up on the Jacob/Javits bill and look at the rules that say we should buy furniture from the Federal Prison System. It's really hard to be economical when you're required to support congress' pet projects ...

Posted by: dragonlady45 | June 30, 2010 2:26 PM | Report abuse

GOOD WORK! KUDOS to the OMB Hunkster Orszag!

We need more common sense cost-cutting like this.

I won't know why our government can't be run as most businesses are, always looking for ways to cut costs and boost that bottom line by streamlining processes, purchasing agreements, etc.

It's not as if we don't have any business people in our government; they should know how to do this.

Posted by: lquarton | July 2, 2010 2:28 AM | Report abuse

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