The Government has a sophisticated past performance system (CPARS). This information is used to evaluate the “Risk Factor” that any give vendor presents in the performance on a federal contract. The federal procurement officer completing the form can provide the vendor with one of the following ratings, Exceptional, Very Good, Satisfactory, and Poor or Unsatisfactory. Below is the government-wide breakdown for ratings given in 2018 among the four main performance categories.
| Category/Rating | Quality | Management | Schedule | Cost Control |
|---|---|---|---|---|
| Exceptional | 26% | 27% | 23% | 23% |
| Very Good | 34% | 34% | 33% | 34% |
| Satisfactory | 37% | 27% | 40% | 41% |
| Poor or Unsatisfactory | 13% | 12% | 4% | 2% |
As you can see about 25% of the time a firm receives an Exceptional Rating and approximately 35% of the time a very good rating, meaning 60% of the time a firm receives a helpful rating.
Agencies are permitted to pay more according to FAR for a lower vendor “risk factor”, in other words pay firms with higher past performance at better rates
The following is the Bid Scale as to how a High Ranking Naval Officer in Defense Logistics presented the value based upon his experience.
Premium Scale
- Exceptional – 6-10% over Satisfactory
- Very Good – 3-5% over Satisfactory
- Satisfactory – No Premium
- Poor
- Unsatisfactory
Therefore obtaining good CPARS ratings translates into higher rates. Additionally it is becoming more common for large GWACS to place up to 40% of the vendor evaluation on a vendors past performance rating. Meaning the vendors providing Exceptional and Very Good service to the federal agencies are the ones most likely to gain positions in these “Best-in-Class” contracts.
Two Advantages of GSA Contracts in terms of Past Performance
GSA Purchases are more Standardized
A GSA purchase from a GSA Schedule is more standardized and is something that is usually routine for the firm providing the product or service. This gives firms that are new to federal contracts the ability to get their feet wet, providing something they have experience with, giving the best opportunity to exceed expectations.
GSA Past Performance is Recorded at Lower Spending Levels
Federal past performance guidelines for when an agency should record past performance on a vendor:
| Civilian Agencies | |
|---|---|
| Architect-Engineers | >$35,000 |
| Construction | >$700,000 |
| All Other | >$150,000 |
| DoD Agencies | |
| Architect-Engineers | >$35,000 |
| Construction | >$700,000 |
| All Other (Depending on the procurement type) |
>$1,000,000 or >$5,000,000 |