Indianapolis, IN, April 16, 2014 (GLOBE NEWSWIRE) -- After learning about the negative impact of the GSA's Federal Strategic Sourcing Initiative (FSSI) KPaul has joined with other businesses to fight against it. The FSSI has been praised by GSA due to the amount it has saved government, but most don't realize that what it has cost the small business community far outweighs any savings. This new acquisition strategy used by numerous federal agencies is negatively impacting small businesses, costing them over 60% in sales and forcing some to close their doors forever.
KPaul President, Kevin Paul had the following to say on the negative impact FSSI has on veterans and veteran-owned businesses:
- "FSSI decreases job opportunities for veterans as GSA contractor holders employ a range of 1 to 6 veterans on average. As these contractors deal with decreased sales they will stop hiring new employees at a time when so many veterans need jobs.
- FSSI increases the number of veteran unemployment claims as GSA contractor holders are losing business and cutting jobs. The loss of jobs will cost taxpayers anywhere from $50 Million to $300 Million.
- FSSI will increase the VA budget as they address the needs of the additional unemployed vets. The 2015 budget projects spending $1.4 Billion on homelessness and $1 Billion on job creation. These figures could more than double if the VA has to address large-scale lay-offs.
- FSSI excludes Veterans returning from service from government procurement. Veterans returning from service often start their own businesses that target government customers. As FSSI initiatives are introduced the GSA is closing the associated Schedule, blocking new companies from selling to the government. Their only option is to attempt to win an FSSI vehicle which is a challenging feat for a fledgling company.
- FSSI shuts veteran-owned businesses out of the government market. The office supply version of the FSSI, the OS3, has no specific small business set-asides. Their "small business preference" is ambiguous at best and could lead to the exclusion of even more veteran-owned businesses. Previous versions of this initiative (OS2) included awards to only 3SDVOSB (1 for full office supplies, and 2 for toner), a small portion of the over 40 in the industry. In total, the OS2 awarded only 13 small businesses out of the 500 on Schedule 75 the opportunity to sell under FSSI."
KPaul believes the GSA implemented the FSSI strategy without completing a proper impact analysis, completely disregarding the initiative's obvious negative impact on small businesses. A group of affected companies, including KPaul, filed a GAO protest against the FSSI and has already made progress with the SBA submitting a response to that protest stating that in their judgment an impact analysis required by the Small Business Act was not completed by GSA. In a story on the SBA response Federal News Radio spoke with Rep. Sam Graves (R-Mo) who said the office supply FSSI (OS3) is a "bad deal for taxpayers" and "will force hundreds of small businesses out of the federal marketplace, which will limit competition for years to come."
Mr. Paul stated, "The matter is now in the hands of the GAO and KPaul hopes that they will encourage the GSA to complete the impact analysis and realign FSSI initiatives to minimize economic displacement in the private sector while still achieving the cost reductions GSA seeks."
For more information on the negative economic impact of FSSI acquisition vehicles, visit the Bornstein & Song Research website. This consulting firm has completed extensive research on the true cost of the FSSI. Centre Consulting has also created a very informative infographic on the subject at: https://magic.piktochart.com/output/1483529-fssi-os2-final
About KPaul:
KPaul is a service-disabled, veteran-owned small business headquartered in Indianapolis, Indiana.