Why Vendors Should Choose to Opt-In

GSA offers existing GSA Schedule holders and new vendors going through the contract award process (offeror) the option to participate in the Transactional Data Reporting program if their products or services fall under one of the eligible Special Item Numbers referenced in the TDR program. To better understand the benefits of opting into the TDR program, one must first understand the compliance requirements of the traditional GSA Schedule, or non-TDR Schedule.

We recently published a short primer on the Non-TDR GSA Schedule type, its requirements, and what must be done by the contractor in order to stay compliant. As a refresher, the vendors with a Non-TDR Schedule must fully disclose all of its Commercial Sales Practices (CSP) to GSA. Commercial Sales Practices includes detailed disclosures of every type of discount offered to each of your customer classes, such as corporations, educational institutions, non-profit, and others. GSA uses your disclosures for three primary purposes:

  • First, GSA uses your CSP disclosures to ensure that they receive your best (i.e. lowest) price;
  • Second, GSA uses your CSP disclosures to establish your Most Favored Customer, which they then designate as the Basis of Award (BOA) class of customer;
  • Third, GSA uses your CSP disclosures to hold you accountable.
      1. The Price Reduction Clause of the Non-TDR Schedule requires that vendors continuously monitor sales to their BOA customer and reduce their prices to GSA anytime the discount relationship established between the BOA customer and GSA’s price is disrupted.
      2. If you fail to fully or accurately disclose your commercial sales practices to GSA, or don’t reduce your GSA pricing when the agreed to discount relationship is disrupted, GSA will come after you to collect the overcharge as well as fines, penalties and possible debarment.

As you can tell, fully and accurately disclosing your CSP and then remaining compliant on a Non-TDR Schedule is critically important. However, tracking your sales and reducing your prices to GSA when the discount relationship is disrupted can be a daunting task. Many vendors have ended up on the wrong end of GSA’s Office of the Inspector General (OIG) and paid dearly for missing sales that should have triggered a price reduction. The CSP disclosures and the Price Reduction Clause are without question the most important and difficult aspects of having a Non-TDR Schedule.

The TDR GSA Schedule

About a decade ago GSA realized the burden that the Price Reduction Clause put on small businesses and worked for many years to find an alternative. The result was the addition of the Transactional Data Reporting (TDR) clause in 2016 as an alternative to the Price Reduction Clause. In a nutshell, the TDR option relies on free market competition to drive prices down rather than government regulation and monitoring. Under the TDR program, vendors no longer have to disclose their commercial sales practices and the Price Reduction Clause is eliminated.

In return for the elimination of the liabilities and monitoring associated with the Non-TDR Schedule, vendors opting into the TDR Schedule must report all GSA Schedule sales transactions monthly, including the actual prices paid by the government. The reported sales transactions are aggregated and anonymized to protect your information and then shared across the government to assist them with future procurements and negotiations.

The following table shows the differences between a TDR and Non-TDR GSA Schedule contract.

TypeTDR ScheduleNon-TDR Schedule
CSP DisclosureN/ACSP disclosure must be submitted with the offer, certain modification requests, and may be required prior to exercise of options
MFC/BOA InformationN/AMust be submitted with offer and with certain modification requests
MFC/BOA Identified at Time of AwardN/AMFC/BOA must be identified at time of award
MFC/BOA Discount RelationshipN/AMFC/BOA price/discount relationship is established at time of award and must be maintained throughout the life of the contract
Tracking of Price Reduction ViolationsN/AContractor is required to track and report price reduction violations.
Evaluation CriteriaOffer is evaluated in accordance with GSAR 538.270-2.Offer is evaluated in accordance with GSAR 538.270-1.
Transactional Data ReportingContractors are required to report information on 11 transactional data elements GSAR 552.238-80 ALTERNATE IN/A
Transactional Data Reporting FrequencyTransactional data reporting is required on a monthly basis, due 30 days after the end of each month.N/A
Non-TDR Contract Reporting FrequencyN/AContractors are required to report total aggregate contract sales, by SIN, on a quarterly basis, due 30 days after the end of each quarter.
IFF Remittance CycleIFF must be remitted no later than 30 days after the end of each business monthly or quarterly at the Vendor’s option.IFF must be remitted no later than 30 days after the end of each business quarter.
Source: www.GSA.gov/TDR


Who is eligible for the TDR Schedule?

The TDR program is currently open to new and existing contractors who have products or services that fall under at least one TDR eligible SIN. Once the TDR eligible SINs have been identified, new offerors will have to elect to participate in the TDR program in eOffer. Existing GSA Schedule holders must submit a modification in eMod to opt into the TDR program. In both cases, having one TDR SIN on contract will apply to every other SIN on contract, even for SINs that are not listed as eligible for TDR.

Should Vendors Opt into the TDR Program?

We believe, without exception, that all vendors should opt into the TDR program if they have an eligible SIN. The table below provides some of the pros and cons of the TDR program.

Allows for the award of pricing that that is market driven. No CSP disclosures are required.TDR is only available to select SINs.
Price Proposals do not require line-item level MFC discounting disclosures for every product/service offered.Frequency to report GSA sales transactions is monthly and TDR requires more detailed reporting.
Liabilities associated with MFC and BOA tracing is eliminated
No need to implement robust sales tracking policies or additional training to accounting and sales teams.
Offers and modifications may be processed faster.
An entire contract with multiple non-TDR SINs may qualify as a TDR contract as long as one of the contract SINs is TDR eligible.


The Future of the TDR Program

Since its 2016 inception, the TDR program has gone through extensive review by both GSA Federal Acquisition Service (FAS), the office responsible for GSA Schedules, and GSA OIG.

GSA FAS loves the program and plans to expand the program to more SINs. The FAS says that all evaluation metrics have been maintained or are showing improvement since TDR’s inception.

In contrast, the GSA OIG has criticized the program and released a detailed report last year recommending that FAS terminate the program for a myriad of different reasons. However, the GSA FAS Commissioner has ardently opposed the termination of the program and has stated clearly that FAS intends to continue the TDR program.

Per the FAS Commissioner, “The TDR program has proved it is a more effective, less burdensome alternative to legacy pricing disclosure requirements. When TDR is used, government prices are lower, the reporting burden on contractors is reduced, and small businesses generate stronger sales growth.”

We agree with the FAS Commissioner’s position and support the expansion of the TDR program. Coley will continue to monitor the TDR program and provide updates. Check back frequently for updates.

Have questions about the TDR Program or help opting into the program? Coley has over 20 years’ experience helping thousands of companies obtain and manage their GSA Schedule. We are available to help make the process easy. Contact us today at hello@coleygsa.com, by phone at 210-402-6766 or schedule a call at a time convenient to you and get started on obtaining your GSA Schedule—a critical step on your road to success in the government market.

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