Category management recently was reemphasized by the Trump administration in OMB guidance and in a rewrite of the Federal Acquisition Regulation. Image: JHVEPhoto/Shutterstock.com
Federal agencies are “leaving billions of dollars in potential savings on the table” by not fully embracing centralized purchasing of common goods and services, the GAO has said.
A report noted that category management, which seeks to leverage the government’s buying power and eliminate duplicative efforts, has been in place for many years, but less than 20 percent of common spending currently goes through centralized GSA contracts. That’s in contrast to leading private sector companies, which “use category management to manage up to 90 percent of their purchases and achieve savings of 10 to 20 percent of total procurement costs,” it said.
In a review of prior reports on the topic, the GAO said that common themes include that agencies underused preferred contracts, and that more emphasis could be put on procuring from small business through such contracts. GAO noted that it recently found the VA falling short of potential savings for reasons including inadequate oversight to assure that responsible officials were carrying out their requirements.
In addition, “Our work has consistently found that agency limitations in collecting, analyzing, and sharing data have hindered category management implementation,” it said, citing a 2020 report that three of seven agencies assessed did not regularly review their spending on IT contracts to identify potential contract duplication or share contract data such as the prices they paid for IT products and services.
Category management recently was reemphasized by the Trump administration in OMB guidance and in a rewrite of the Federal Acquisition Regulation. The GAO said that those efforts “have the potential to advance category management by providing the tools, training, and expertise needed” but that they “will require close collaboration and well-defined agreements” between the GSA and the purchasing agencies.
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