As discussed extensively in this blog, providing level 3 data can reduce your expenses... Read More »]]> Recently, Mark Amtower showed the statistics in the decrease of spending in the GSA SmartPay program.  Spending dropped approximately 3 billion dollars and 20,000 transactions in FY 2012 compared to FY2011.  Are you suffering from lowering buying from the government?  If so, how do you offset this?  It’s time to look at your expenses.  The first place to look is at your credit card processing expenses.

As discussed extensively in this blog, providing level 3 data can reduce your expenses on GSA SmartPay transactions by as much as 40%.

Often times, when the subject is brought up, the federal contractor cringes.  They have this thought in their head of all the extra work required.  Buying new software, learning a new process, typing in the data line by line and a transaction taking 10 minutes just to get it to go through are all concerns of federal contractors.  Taking a few minutes to review your options can take the stress out of making the decision.

Products are available that will:

Store customer Information – allowing you to recall it in an instant when there is another transaction

Store cardholder data-  at a third party site, helping you meet PCI Compliance guidelines

Store Line Item detail -  allowing you to pull up the level three data with a click of the mouse

Don’t let the thought of change discourage you from looking at your options.  The process will pay for itself in the long run.

 Today Government Charge Card is pleased to publish a piece by Jennifer Schaus. Jennifer is the principal of Jennifer Schaus & Associates, a boutique government consulting firm in Washington, DC with offices in Rome, Italy.  The organization helps small, mid-size, Fortune 500, domestic and international firms with government contracting; GSA Schedules to 8a Certification as well as sales, marketing and lobbying.

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Yes, “Clear Winners and Losers” – GSA’s words, not... Read More »]]> Guest Post- Jennifer Schaus of Jennifer Schaus and Associates

 Today Government Charge Card is pleased to publish a piece by Jennifer Schaus. Jennifer is the principal of Jennifer Schaus & Associates, a boutique government consulting firm in Washington, DC with offices in Rome, Italy.  The organization helps small, mid-size, Fortune 500, domestic and international firms with government contracting; GSA Schedules to 8a Certification as well as sales, marketing and lobbying.

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Yes, “Clear Winners and Losers” – GSA’s words, not mine. GSA has decided that the government is paying too high a price for the goods and services they purchase. That’s what this FSSI (Federal Strategic Sourcing Initiative) thing there are selling you is all about. The last time I saw “SS” together, the outcome was not favorable.

GSA states there are too many discrepancies in price for the same product – and not enough volume discounts for the overall government spend. Aren’t GSA Schedules designed to obtain “fair & reasonable pricing” and obtain the same (or better) volume and quantity discounts offered to your other customers in the commercial marketplace? Surprise, surprise – GSA is putting the burden of work onto the contractors because their own – taxpayer funded – accounting and financial systems cannot track this information. Shameful. GSA is asking vendors in select Schedules to provide exhaustive data so that they (GSA) can standardize what they are buying and at what price – to eventually chop the expensive offerings off the block. These vendors would be the “Losers” according to GSA. What will happen to the “Losers”? Can they bid again to get on the FSSI short-list? How long is the wait to bid again? No clear answer was provided in an open Industry session today at GSA HQ, but don’t worry there is ample business – especially in large volume – for the “Winners”.

Out here in the real world, perhaps our out-of-touch government friends have not realized that this obviously hurts small business. There is a huge cost involved in extracting the required information – and in case GSA has not noticed, small businesses are struggling – just with staying alive each month. Cutting certain industries out of competing for government contracts with the 7 agencies who have “signed on” to FSSI just does not look, smell or sound like a pro-small business program to me!  In fact, it smells like something else.

Why is it that buyers cannot obtain the lowest price for items through novel ideals like GSA E-Buy, or simple FBO.gov solicitations and open competition? Plus, lowest price is not always the best answer, because if that is your only deciding factor, quality will surely be sacrificed. Lowest price will eventually turn into a game of contractors buying contracts just to have business, and recognize no margin. Not a great idea for business growth, which oh, by the way, pays your salary, Uncle Sam.

There are many problems with this FSSI initiative. The real fix could come from internal GSA reform. Perhaps GSA should consider educating the agencies that use the Schedule for purchases to conduct some market research – available at their finger tips on GSA Advantage. For example, plug in any MRO product and you’ve got pages and pages to choose from. Amazingly enough you can even sort by price!   If GSA is complaining they have buyers spending $100 and $20 for the same product – the repercussions and penalties should be on the buyer/agency – not to the small business who gets booted off this price war game. So, let’s fix this problem by educating the buyers about how to spend government dollars – wisely!! Limiting competition and a short list vendor pool is not the foundation and principles that this country was built on. It is also not the answer in government contracting. Plus, didn’t we hear during the debates and pre-election propaganda that the current administration was pro-small business? Actions and programs like this (among others) speak loud and clear.

Ask any small business, woman owned, veteran owned, HUB-zone, etc if FSSI is good for them. I’d be surprised if we got one “yes”. Heck, these businesses cannot even get the 23% of the contracting goals set aside for them as it is. The FSSI policy slick-salesman Joe Jordan ensures us that there will be plenty of opportunity for small business in various socio-economic categories – while in the same breathe pontificating about clear Winners and Losers. In other words, “Happy FSSI’ing – and may the odds be ever in your favor!”

To:   All GSA Staff

From: Acting Administrator Dan Tangherlini

It has been a busy nine months since I joined GSA as Acting Administrator. During that time, it has been my honor to get to know and work alongside you. I am incredibly proud of everything that we have accomplished together in 2012, and your public service has made a meaningful difference in the lives of people across the country. As we begin a new calendar year together, I am confident... Read More »]]> MEMORANDUM

To:   All GSA Staff

From: Acting Administrator Dan Tangherlini

It has been a busy nine months since I joined GSA as Acting Administrator. During that time, it has been my honor to get to know and work alongside you. I am incredibly proud of everything that we have accomplished together in 2012, and your public service has made a meaningful difference in the lives of people across the country. As we begin a new calendar year together, I am confident we will continue to build upon the progress that we have already made and make GSA the model of efficiency and integrity for the entire federal government.

Continue Reading Here

Recently, a blog written on January 10th by Dan Tangherlini , Acting Administrator, General Services Administration, titled GSA to Launch 10 Strategic Sourcing Initiatives, spells out the new, upcoming initiatives of strategic sourcing and the plans to... Read More »]]> It’s the beginning of a new year. Out with the old and in with the new as the mantra goes. It’s that time when we look for a new start, a different way of thinking, thoughts about how to improve our business, etc.

Recently, a blog written on January 10^th by Dan Tangherlini , Acting Administrator, General Services Administration, titled GSA to Launch 10 Strategic Sourcing Initiatives, spells out the new, upcoming initiatives of strategic sourcing and the plans to add “10  new government-wide strategic sourcing solutions for a range of commonly purchased products and services – such as cleaning products, tools, and wireless devices – over the next two years”. With these initiatives looking to save the taxpayer hundreds of millions of dollars, they look to reduce the variance between what different agencies pay for the same products or services, increase efficiencies and cut overall costs.

While this is certainly a step in the right direction to help cut down on waste in government, especially with tax payer money, it will put the squeeze on profits to the contractors that will fulfill these strategic sourcing contracts.  This has to get government contractors thinking about how they might be able to reduce costs and better compete at a time when margins are razor thin and the threat of sequestration is looming.

One way is to be sure that they are paying the lowest possible fees when accepting payment with the GSA SmartPay cards. Properly submitting the necessary information with their credit card transactions can accomplish this goal with little effort on the part of the contractor.  When processing a GSA SmartPay card or any purchasing card, the information that is sent with the transaction often determines whether a contractor will get the lowest possible costs on those cards. For GSA SmartPay cards and purchase cards, this information is called line item detail. Included in this additional information is discount amount, freight or shipping amount, item commodity code, product code, quantity, etc. While this may seem like a lot of information, most of the fields for these transactions can be pre-populated and sent with the transaction thus allowing the transaction to qualify for the lowest possible rates. This simple but effective way of reducing fees has helped contractors save up to 40% off of their processing costs. This can equate to quite a bit of money and definitely worth looking into!

Washington Technology had an article about one... Read More »]]> Many banks, especially in the Washington, DC area, have developed special programs for lending to federal contractors.  These include Virginia Commerce Bank, John Marshall Bank, First Virginia Community Bank, Capital Bank, Virginia Heritage Bank, Sandy Spring Bank, Xenith Bank, United Bank, Access National Bank, Cardinal Bank, Bank of Georgetown, and Freedom Bank of Virginia.  These institutions understand that working with businesses that have the government as their main customer requires specialized knowledge and expertise.

Washington Technology had an article about one of these banks, Freedom Bank of Virginia, titled A Bank that puts Contractors First: http://washingtontechnology.com/articles/2007/04/21/richard-litman–a-bank-that-puts-contractors-first.aspx  In it, Richard Litman, Chairman, states: “ Our goal is not to be a place where you deposit money and are just an account number.  Our goal is to be much more: to connect our clients with our real experts in government contracting who can provide the insight they need to grow. . . . “

An important way to accomplish this is to form a relationship with a credit card processor that is a real expert in providing government contractors with the ability to process GSA SmartPay cards under the guidelines of the GSA SmartPay purchase card , which is now being mandated in many gov’t contracting decisions and to become level-3 compliant.   Federal contractors are being called on to become increasingly compliant with requirements that they pass Level-3 line item detail to the government when accepting the SmartPay card.  By partnering with the right processor, Banks can help insure that their clients will not miss out on opportunities to qualify for contracts within the increasingly large body of Strategic Sourcing Initiatives and other GSA programs requiring Level-3 compliance.

Any bank can make a loan, but a bank that wants to best serve the needs of the federal contracting community needs to have a partner who can add that extra arrow to the quiver, and provide their clients with the best possible processing program for accepting government charge cards.

As OMB’s Deputy Director Jeffrey Zients notes in the memo, “One key way agencies have saved money is by pooling their spending, either by centralizing the agency’s contracting decisions or by using government-wide strategic sourcing vehicles, in order to lower prices and reduce duplication and... Read More »]]> The pricing in your bids to the government just got a lot more competitive.The Office of Management and Budget (OMB) released a memo on December 5, 2012 that outlines the focus of more Strategic Sourcing Initiatives.

As OMB’s Deputy Director Jeffrey Zients notes in the memo, “One key way agencies have saved money is by pooling their spending, either by centralizing the agency’s contracting decisions or by using government-wide strategic sourcing vehicles, in order to lower prices and reduce duplication and reduce administrative costs.”

The strategic sourcing initiative goal is to ultimately lower costs to and “negotiate the best deal for the taxpayer”.  How do they do that? By receiving lower bids from you, the Federal Government Contractor.  Lowering your bid may get you the business, but your profit will not be what it once was.

Now you have to take the initiative.  How can you create more profit without raise your prices?  Naturally, by lowering your costs.  One large area of cost is your GSA SmartPay processing fees.

Enter Level 3 processing….as discussed before on this blog Visa and MasterCard took a step in the right direction when they assigned a special category for GSA SmartPay Cards. Sending and transmitting line item detail will allow you to qualify for a reduced rate. The reduced rate can be anywhere between 50 and 150 basis points lower (20-50% savings) than an unqualified transaction (transaction submitted w/o the proper data).  Sending the data is simple.  Now it’s time for you to take the initiative.

The GSA implemented Strategic Sourcing Initiatives to reduce costs and improve the overall procurement experience. According to the GSA, FSSI has been implementing strategic sourcing solutions for the government since 2005.  The initiative has proven results that include cost savings, improved management visibility and adoption of industry and government agencies best practices. The initiative also has helped improve government management of commonly purchased goods... Read More »]]> In a recent article at the Federal Times, Sarah Chacko wrote about the impending changes to the Strategic Sourcing Initiative.

The GSA implemented Strategic Sourcing Initiatives to reduce costs and improve the overall procurement experience. According to the GSA, FSSI has been implementing strategic sourcing solutions for the government since 2005.  The initiative has proven results that include cost savings, improved management visibility and adoption of industry and government agencies best practices. The initiative also has helped improve government management of commonly purchased goods and services.

Currently, there are four strategic sourcing contracts. Now comes the big news………there are plans for 10 new contracts starting in 2013.

We’ve discussed previously on this blog the objective of the government to introduce Level 3 Data  as the reporting source to the Federal Strategic Sourcing Initiative. As more contracts are added to the FSSI, there will be a move to accomplish more of the initial objectives, including Level 3.

As the trend continues to add new contracts to the FSSI, it’s important as a government contractor to stay up with the changing technology. Or in this case, ahead of it.

Lets review the benefits of Level 3 Processing for contractors:

Faster Funding – reduces payment time from 30-60 days to 2-3 days.

Savings – Take advantage of special rates from Visa and MasterCard by processing Level 3 line item detail.

Increased Sales Potential – as a result of increase access to government contractors.

The new contracts have not been announced yet. So we don’t know which commodities are next, but it’s still important to keep up with the changes. Your ability to process the level 3 transactions will not only make your business with the government more cost effective, but could  soon be required by the government.

In the article below Stephanie discusses the importance of Oracle EBS, GSA SmartPay2 ™ and Level-3 data and especially PCI Compliance for companies doing business with the U.S. government.

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Kicking it Up by Shrinking it Down: Level 3 and Reducing the... Read More »]]> Government Charge Card is pleased to publish the following guest post by Stephanie Levine, Director of Marketing at Princeton Payment Solutions (PPS). PPS is a division of Financial Transaction Services (FTS) who provides comprehensive responses to critical payment components for clients.

In the article below Stephanie discusses the importance of Oracle EBS, GSA SmartPay2 ™ and Level-3 data and especially PCI Compliance for companies doing business with the U.S. government.

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Kicking it Up by Shrinking it Down: Level 3 and Reducing the PCI Scope of Oracle EBS

“Do more, and do it with less”: a phrase that haunts your business review meetings.

How are you kicking it up?

In the case of your Oracle E-Business Suite, less really can be more: less expense, less staff time on PCI audits and more secure, more compliant. How’s that? Your Oracle EBS allows your in-house IT staff to smoothly address the evolving needs of your business. But expanding security requirements seem likely to cost you more, because your standard Oracle EBS doesn’t currently meet PCI compliance standards. If you are a processor of Level 3 data for SmartPay2 through VISA/MC, you also have obligations imposed by your acquiring bank for data security and PCI compliance.

You can kick it up by shrinking it down.  Choose a capable PCI certified middleware, such as CardConnect with CardSecure/Tokens, and segregate the hardware (either in-house, hardened, or in the cloud). When you shrink your PCI scope by making your Oracle EBS PCI compliant, you improve your security, decrease your risk, protect your customers, and expedite your PCI audit. In addition, CardConnect with CardSecure (v5.2) achieved Oracle Validated Integration with Oracle E-Business Suite R12 in September 2012, ensuring its transferability among EBS releases.

CardConnect supplies the necessary functionality for E-Business to securely connect to the banking system. It’s your middleware communications module for your payment card authorizations and settlement files. CardConnect is housed on a dedicated, secure server separate from your ERP environment, either at your site or hosted by us. CardSecure/Tokens encrypts and protects payment card information. Further proprietary software add-ons can help optimize your interchange rates.

Consider the Ease of Integration and Data Capture

CardConnect connects with EBS via the standard Oracle Gateway Interface (HTTPS), which requires only standard configuration changes to link up. For encryption and tokenization, CardSecure/Tokens also utilizes HTTPS to receive card data and return a token for input on the EBS order entry screen. (The use of a token requires select, limited modifications to your EBS).  CardSecure/Tokens captures and secures sensitive data as early as possible, minimizing the exposure of your EBS infrastructure to internal breaches as well as external risks.  Desktop Tokenizer (a Windows applet), sitting outside the ERP environment, tokenizes payment card data without changing your EBS order entry screens and sends sensitive data directly to CardSecure. The token is pasted into EBS Order Entry, allowing credit authorization and order processing to proceed expeditiously.

Here’s the best bit: tokenization exempts your E-Business infrastructure and its database from PCI audit compliance, by cloaking and isolating sensitive data, when accompanied by appropriate network segregation. The actual card data is stored in the same dedicated, encrypted database server hosting CardConnect, which takes your EBS environment out-of-scope during a PCI compliance review or audit.

Kick it up by shrinking it down.