Service with Aloha …

1. Service with Aloha … FLEET LOGISTICS CENTER

2. Contracting 101 for Customers • Goal: • Educateour customers on the contracting process – • Provide a simplified understanding of procurement • Defineexpectations – • Identify the Customer’s and the Contracting Officer’s individual responsibilities within the context of procurement execution • Sharelessons learned and best practices – • Combine our synergistic efforts to improve our effectiveness in supporting the Warfighter

3. Contracting 101 for Customers • What are the regulations and guidelines?

4. Contracting 101 for Customers • Agenda: • Part I, “Fundamental Principles” • Part II, “The Contracting Process” • Part III, “Best Practices and Lessons Learned” • Part IV, “Resources for Assistance”

5. Contracting 101 for Customers • Part I, “Fundamental Principles”

6. Part I, “Fundamental Principles” • Federal Acquisition System Vision: • “…to deliver, on a timely basis, the best value product or service to the customer, while maintaining the public’s trust and fulfilling public policy objectives.” • “Participants in the acquisition process should work together as a team and should be empowered to make decisions within their area of responsibility.” • (FAR 1.102)

7. Part I, “Fundamental Principles” • Contract Definition: • “A mutually binding legal relationship obligating the seller to furnish the supplies or services and the buyer to pay for them” FAR 2.101 • Contract Elements: • Offer, acceptance, consideration, legal purpose, and competent parties

8. Part I, “Fundamental Principles” • Contract Elements:

9. Part I, “Fundamental Principles” • Acquisition Team: • Customers: • End user • Technical representative • Financial points of contact • Contracting Office: • Contracting Officer • Contract Specialist / Purchasing Agent

10. Part I, “Fundamental Principles” • CUSTOMER • Acquisition Team: • CONTRACTING OFFICE

11. Part I, “Fundamental Principles” Customer Responsibilities • CUSTOMER • Customer AOR

12. Part I, “Fundamental Principles” Customer Responsibilities • Customer Responsibilities: • The customer is responsible for: • Defining the requirement • Completing market research • Developing Independent Government Estimate (IGE) • Submitting a complete procurement request package • Actively participating in the acquisition process • Remember…you have a significant role in the process

13. Part I, “Fundamental Principles” Contracting Responsibilities • Contracting AOR • CONTRACTING OFFICE

14. Part I, “Fundamental Principles” Contracting Responsibilities • The Contracting Officer is the only person authorized to bind the Government legally by signing a contract • Contracting Officers receive their appointment authority through the Head of the Contracting Agency (HCA at NAVSUP) • Any other person who obligates the Government is entering into an Unauthorized Commitment

15. Part I, “Fundamental Principles” Contracting Responsibilities • The Contracting Officer shall: • Ensure all requirements of law, executive orders, regulations, and all other applicable procedures, including clearances and approvals, have been satisfied. • Ensure sufficient funds are available for obligation. • Ensure contractors receive fair and equitable treatment. • Request and consider the advice of specialists in audit, law, engineering, transportation, and other fields as appropriate. • Document that the proposed contract is in the best interest of the Government. • Issue timely contracts and contract modifications.

16. Part I, “Fundamental Principles” Contracting Responsibilities • Procurement Acquisition Lead Time (PALT): • The NAVSUP goal is to process routine purchase requests within the specified cycle times indicated below: • Requirements < $25K 20 Days • Requirements $25K to $150K 30 Days

17. Contracting 101 for Customers • Part II, “The Contracting Process”

18. Part II, “The Contracting Process” • Contracting Process Overview: • Involves all activities associated with identifying and justifying a mission need, formulating an acquisition strategy to meet this need, and implementing the strategy by means of a contractual relationship with the private sector

19. Part II, “The Contracting Process” • Five Main Phases of Procurement 1 2 3 4 5 Modification Request & Contract Closeout Procurement Request (PR) Contract Execution Request for Quote (RFQ) Source Selection

20. Part II, “The Contracting Process”Customer Responsibilities • Step 1 Acquisition Planning: • …the process by which the efforts of all personnel responsible for an acquisition are coordinated and integrated through a comprehensive plan for fulfilling the agency need in a timely manner and at a reasonable cost. It includes developing the overall strategy for managing the acquisition

21. Part II, “The Contracting Process”Customer Responsibilities • Step 1 Acquisition Planning:

22. Part II, “The Contracting Process”Customer Responsibilities • Defining The Requirement

23. Part II, “The Contracting Process”Customer Responsibilities • Define your requirement: • The process starts with identifying, defining, and detailing your procurement needs • When a customer can adequately identify the procurement need, accurately describe the relevant history, and confidently detail anticipated scope and requirements, we can start the contracting journey

24. Part II, “The Contracting Process”Customer Responsibilities • Define your requirement (cont.): • FAR Part 11 specifies that when describing agency needs, acquisition of supplies or services should be stated in terms of a) functions to be performed, b) performance required, or c) essential physical characteristics. • If your requirement is a product (supplies), you should have all possible information relating to that product, an explanation of its desired functionality, and data regarding the end user’s need.

25. Part II, “The Contracting Process”Customer Responsibilities • Define your requirement (cont.): • If your requirement is a service, you should be able to specify the required support, estimate the duration of need, and outline desired results. • These specifications will facilitate obtaining the best possible services and maximizing the outcome. Current DoD policy, implementing public law, identifies that performance-based service acquisition (PBSA) is the preferred method for obtaining services. • We will work with you to finalize the Performance Work Statement (PWS)

26. Part II, “The Contracting Process”Customer Responsibilities • Conducting Market • Research

27. Part II, “The Contracting Process”Customer Responsibilities • Market Research Basics: • Before initiating a procurement action, the customer must perform due diligence in assessing what products or services already exist. • Before acquiring supplies or services from commercial resources, the customer must conduct market research (FAR Part 10), and that market research should be an element of the procurement request package • An important reason for conducting market research is to identify potential socioeconomic opportunities

28. Part II, “The Contracting Process”Customer Responsibilities • Market Research Basics (cont.): • The extent of market research will vary depending on such factors as urgency, estimated dollar value, complexity, and past experience • Customers should document the results of market research in a manner appropriate to the size and complexity of the acquisition

29. Part II, “The Contracting Process”Customer Responsibilities • Market Research Techniques: • Customers must review the following sources (via internet search) to research if they are capably of satisfying agency needs (FAR Part 8):

30. Part II, “The Contracting Process”Customer Responsibilities • Market Research Techniques: • The following are examples of well-established market research techniques: • Contact industry and Government experts • Use Internet search engines • Reviewing catalogs and trade journals

31. Part II, “The Contracting Process”Customer Responsibilities • Developing An IGE • (Independent Government Estimate)

32. Part II, “The Contracting Process”Customer Responsibilities • Develop an IGE: • The IGE helps the Contracting Officer determine the reasonableness of a contractor’s quote • The IGE assists with ensuring that there is a “meeting of the minds” between the customer and contractor regarding the scope of the contract • Provide both the pricing estimate and detailed explanation of how your IGE was developed • Contacting a vendor and obtaining a price quote IS NOT an IGE

33. Part II, “The Contracting Process”Customer Responsibilities Sample IGE

34. Part II, “The Contracting Process”Customer Responsibilities Explanation of how the IGE was developed: The labor categories and the amounts of hours within each of those categories are based on previous, similar levels of effort expended to accomplish similar workloads. The effort amounts to one full man-year for the Logistician; one full man-year for the Supply Technician; and the Program Manager’s hours are approximately 13% of both Logistician’s and Supply Technician’s hours. The labor rates are from a GSA Schedule (identify GSA Order number). If the labor rates are from a DoD contract, identify the DoD contract number.

35. Part II, “The Contracting Process”Customer Responsibilities • Competition Requirements

36. Part II, “The Contracting Process”Customer Responsibilities • Limiting Competition: • Federal law requires competition on all procurements over the micro-purchase threshold • Under certain circumstances, the customer may have a requirement that is not suitable for full and open competition. • The Requiring Activity must provide detailed documentation to support limiting competition (specific forms and FAR-based exceptions must be used) STATEMENTS SUCH AS “ONLY KNOWN SOURCE,” “ONLY SOURCE THAT CAN MEET REQUIRED DELIVERY DATE” OR “OFFERS LOWEST PRICE” ARE NOT SUFFICIENT 36

37. Part II, “The Contracting Process”CustomerResponsibilities • Common Exception to Full and Open Competition (FAR 6.302): • Only One Responsible Source [10 U.S.C. 2304(c)(1), FAR 6.302-1]: • Unique supplies or services are available from only one source or only one supplier with unique capabilities • Award to any other source would result in substantial duplication of cost to the Government that is not expected to be recovered through competition or unacceptable delays in fulfilling the requirement • This rationale must be thoroughly explained within the specific context of your procurement. 37

38. Part II, “The Contracting Process”Customer Responsibilities • Common Exception to Full and Open Competition (FAR 6.302): • Unusual and Compelling Urgency [10 U.S.C. 2304(c)(2), FAR 6.302-2]: • Delay in award of a contract would result in serious injury (financial or other) to the Government unless competition is limited • This statutory authority requires that agencies shall request offers from as many potential sources as is practicable under the circumstances • This rationale must be thoroughly explained within the specific context of your procurement. 38

39. Part II, “The Contracting Process”Customer Responsibilities • Sample Sole Source Rationale: • Repair parts only available through original equipment manufacturer (OEM), and a market survey has been conducted to support this statement (include all details of market research – whom you contacted and when this research was completed). • The source has established proprietary rights to the item or service required. • The work is so closely related to that of an on-going contract that it would not be feasible to consider another potential contractor due to a substantial duplication of costs (provide details concerning specific costs). • Other contractors are not qualified to perform necessary services (specific detailed qualifications must be provided in the statement of work/description). • Compatibility and interchangeability with existing equipment. 39

40. Part II, “The Contracting Process”Customer Responsibilities • A subset of sole source is Brand Name • An acquisition that uses a Brand Name description (i.e., Motorola) or other description that is peculiar to one manufacturer. • Shall not be used unless the particular brand name, product, or feature is essential to the Government’s requirements, and market research indicates other companies’ similar products, or products lacking the particular feature, do not meet, or cannot be modified to meet the agency’s need • The Customer must justify any requirement for a specific Brand Name procurement. • The Brand Name Justification (same NAVSUP form as the Sole Source Justification) is posted with the RFQ on NECO (open market) or GSA-eBuy for procurements >$25,000 40

41. Part II, “The Contracting Process”Customer Responsibilities • Sample Brand Name Rationale: • Compatibility with existing equipment • Submit documentation of existing equipment value and special features requiring compatibility that no other manufacturer can provide • Similar products lack features that are necessary to meet the Government’s minimum needs • Specific detailed features must be provided in the description 41

42. Part II, “The Contracting Process”Customer Responsibilities • Remember: • Sole Source/Brand Name and Limited Source Justifications must be meaningful and documented on the correct NAVSUP form: • Open Market (Sole Source / Brand Name Justification IAW FAR 6.302) • GSA procurements (Limited Source Justification IAW FAR 8.405-6) • A strong presentation that merely establishes that the recommended source is most highly qualified to perform but does not establish why other sources cannot perform is UNACCEPTABLE. 42

43. Part II, “The Contracting Process”Customer Responsibilities • Submitting A Complete • Procurement Package

44. Part II, “The Contracting Process”Customer Responsibilities • Submit a complete procurement ready package: • Purchase Request / Funding Document • Form 2276 or 1149 with GLS Acceptance • Justification Documents (If Needed – see previous slides for details) • Sole Source and/or Brand Name Justification, or Limited Source Justification for GSA • Urgency/Impact Statement • Detailed Description / Essential Characteristics of Supply or Service • Delivery Information, Payment Instructions (WAWF or GCC) • Points of Contact (Technical and Financial) • Informal Quotes from 3 Suggested Sources – Market Research • FAR Part 19 requires all procurements under $150K to be set-aside for small businesses • Performance Work Statement for Services – results oriented

45. Part II, “The Contracting Process”Customer Responsibilities • GLS SOP if a PR Package is Not Procurement Ready: • Step 1. Buyer notifies customer and requests additional information that is needed. • Step 2. Two (2) working days later, if the information is still not received, the buyer again requests the information that is needed from the customer. • Step 3. Two (2) working days after the Step Two follow-up. If the Customer still has not provided required information, cancel the requisition and send all documentation back to customer.

46. Part II, “The Contracting Process”Customer Responsibilities • CONTRACTING • Acquisition Planning

47. Part II, “The Contracting Process” Acquisition Planning • Step 1 Acquisition Planning: • Assumption: • Customer has submitted a procurement ready package with all necessary documentation • The Contract Specialist acts as a business advisor and begins planning the acquisition strategy in conjunction with the customer

48. Part II, “The Contracting Process”Acquisition Planning • Step 1 Acquisition Planning (cont): • Contract Specialist reviews customer submitted market research • It is the responsibility of the Contract Specialist to verify and provide any supplemental market research to support the customer provided market research • The goal of the Contract Specialist is to know the requirement as much, if not more, than the customer. This will ensure the contract specialist fully understands the requirement and to ensure the correct supplies and/or services is purchased.

49. Part II, “The Contracting Process” Acquisition Planning

50. Part II, “The Contracting Process” Solicitation • Step 2 Solicitation: • The objective of preparing and issuing an RFQ is to ensure that all qualified contractors are given the opportunity to compete for the contract award and fulfill your requirements. • This phase of the contracting process includes preparing the solicitation; publicizing the planned procurement; amending the solicitation, as necessary; communicating with the contractors, as necessary; and receiving the quotes.