DoD has a process to determine if an item is available for purchase in the commercial marketplace at a reasonable price, GAO has said, but its efforts to share information across the department to inform these determinations “are in early stages of development or informal.”
“The department’s process for determining whether an item can be purchased commercially–and, at a fair and reasonable price–can be long and challenging in certain situations,” a report said.
The main factors that influence how and whether DoD determines if an item is commercial and if its price is reasonable include availability of marketplace information, ability to obtain contractor data, the extent of modifications to an item, and the reliability of prior commercial item determinations, GAO said.
However, each of those has its challenges, it said. For example, products DoD requires may not be widely available in the commercial marketplace; contractors are less willing to provide information DoD needs to determine if a price is reasonable once the item has been declared commercial; determining the cost of modifications can take considerable effort; and contracting officers may presume that an item is commercial if a DoD component had previously made that determination, even if that was based on inaccurate information.
DoD agreed with recommendations that it develop a strategy for internal sharing of information on such determinations, including improving the existing database and determining responsibilities for its upkeep.
