GSA Schedule Reseller-Manufacturer RelationshipsRisky Business?
Breakout Session #: C05
Jeff Clayton and Rob Austin
Date: Monday, July 25
VA OIG Report on FSS Contracts with Resellers From a 2007 Veterans Administration Office of Inspector General report on FSS contracts:
The manufacturers are large businesses who are using resellers to shield themselves (the manufacturers) from FSS pricing provisions that ensure fair and reasonable prices for Government customers. As a result of this non-commercial practice, FSS customers pay inflated prices and lose the pricing protections the FSS contract was designed to provide.
Polling Question Instructions
Text JEFFREYCLAYT124 to the five-digit number 22333 to join session Text your answer to 22333. Only one response per poll.
Standard text messaging rates apply No spamming Completely anonymous
Questions during the presentation? Text them to 22333
Which of your speakers once fell into the Baltimore Harbor?
Where did you travel from?
Would you rather learn about resellers and manufacturers right now, or head to happy
Rob Austin, CFCM Director
Jeff Clayton Principal
Overview of Reseller Manufacturer Relationship
CSP Disclosure Requirements Contracting and Compliance Requirements Best Practices Current Trends
GSA Schedule contract holder
Sell the manufacturers product (or service) to the end user
Can add value through marketing and customer relationships and industry knowledge
Manufacturer Manufacturers products or
performs services Supplies product or services
to reseller Does not own the relationship
with the ultimate end user
Overview of Reseller Manufacturer Relationship
How do you sell to the Government?
A. Direct B. Through a Reseller C. Both D. N/A (e.g., Government, Media)
CSP Disclosure Requirements Resellers If a Reseller has significant sales of the products, they
submit a current, accurate and complete Commercial Sales Practice (CSP) Format and disclosures for each product/SIN offered.
Only required if the manufacturers sales under any resulting contract are expected to exceed $500,000. (Note: GSA can request a CSP even if sales
Requirements CSP-1 Format
TYPE OF CUSTOMER STANDARD DISCOUNTS & PRICING POLICIES
NON-STANDARD DISCOUNTS, INLCUDING DEGREE & FREQUENCY
FOB Point Concessions % of Gross
Distributors (sell only to
Dealers/Resellers (resell to end users)
State & Local Governments
National & Corporate Accounts
Commercial End Users
Proposed GSA Discounts
Requirements - Reseller
Pay IFF Monitor Discounting Practices Obtain Letter of Supply Certify Country of Origin Monitor Sales for the Purposes of the Price
SIN # Manufacturer /
Retail Price/ MSRP/ MLP
Dealer's Actual Cost / Price
Dealer's Discount (% from Retail Price)
Proposed GSA Price
Discount (% from Retail Price)
Proposed GSA Price (with IFF of
.75%) Country of Origin Warranty
Reseller Price List Example
Requirements - Manufacturer Manufacturer must do the following:
Supply sufficient quantities Uninterrupted supply Disclose future pricing changes
Newly manufactured Commercially sold TAA compliant
Discounts offered Point(s) of production Disclose:
Best Practices - Resellers Establishing Basis of Award and Price Reductions Clause
mechanisms Establish system for Manufacturer to alert about price
changes Awareness and certification of manufacturers COO
policies Structured manufacturer agreement Systems and processes to address compliance
requirements Support value added to supply chain Prompt payment of IFF
Best Practices - Manufacturers
Current, accurate and complete CSP Disclosures
Structured Reseller agreements Internal controls to monitor:
Pricing Government sales records Reseller Discounts Country of Origin Updates
VA vs. GSA VA OIG Report 2007
Heightened GSA Focus Increased enforcement activity
Baker Tilly Experiences Recent GSA OIG/DOJ activity
Which of the following cases is related to the Reseller-Manufacturer relationship?
A. Oracle B. Samsung C. Carahsoft D. Fastenal
VMware, Inc. and Carahsoft
In June 2015, the Department of Justice announced the two companies agreed to pay $75.5 million to resolve allegations that they violated the False Claims Act (FCA). Did so by misrepresenting their Commercial
Sales Practice (CSP) disclosures and overcharging the Government.
Jeff Clayton, Principal firstname.lastname@example.org
Jeff Clayton is a principal in the Government Contractor Advisory Services Practice at Baker Tilly. He has more than seventeen years experience providing a broad range of pricing, contract compliance and dispute/litigation related services to government contractors and their legal counsel. Jeff has extensive experience working with contractors and their counsel during Office of Inspector General (OIG) audits, Department of Justice (DOJ) investigations, and in defense of qui tam suits brought under the False Claims Act.
Rob Austin, Director email@example.com
Rob is a director in the Government Contractor Advisory Services Practice at Baker Tilly. He has more than ten years of experience providing specialized pricing, compliance, negotiation, audit and litigation support services to government contractors across a variety of industries Rob significant experience supporting FSS contractors through the Mandatory Disclosure program and providing litigation support in support Federal False Claims Act allegations.
Slide Number 1Slide Number 2VA OIG Report on FSS Contracts with ResellersPolling Question InstructionsPolling QuestionSlide Number 6Slide Number 7IntroductionAgendaOverview of Reseller Manufacturer RelationshipPolling QuestionCSP Disclosure RequirementsRequirements CSP-1 FormatRequirements - ResellerReseller Price List ExampleRequirements - ManufacturerBest Practices - ResellersBest Practices - ManufacturersCurrent TrendsPolling QuestionVMware, Inc. and CarahsoftQuestions?Contact Information