Contractors' Use of Federal Supply Schedules

The Federal Supply Schedule Program and the Express Small Package Service Contract, with FY 1990 sales volume of 2.4 billion and 33 million, respectively, are supply and service programs administered by the General Services Administration GSA. DOD contractors holding cost-reimbursable contracts can be authorized to purchase supplies and services from these programs. The objectives of this audit were to determine if contractors were using these two GSA programs in performing DoD cost-reimbursable contracts, how much DoD could save if these contractors used the programs more, and the effectiveness of internal controls over contractors use of these Government sources. The audit showed that contractors used Federal Supply Schedules when they knew about the schedules. The contractors we visited could have reduced their costs for express delivery of small packages by 36 to 64 percent if they had used the GSA service contract. These conditions occurred because contracting officers and contractors were unaware of the GSA programs. Cost savings can be obtained, but too many variables were involved for the audit to be able to determine just how much DoD could actually save with greater contractor use of these two GSA programs.