Federal block

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

GSA Schedule Contracts for Civilian Agencies generally fall into the “All Other” category [yellow] for recording past performance on all procurements. The big advantage this provides for the GSA Schedule holder is that it gives the firm the lowest threshold outside of “Architect=Engineers” for obtaining Federal Past Performance. If the firm later decides to pursue IDIQ contracts or contracts that require a formalized bidding process the firm, provided it has done a good job, past performance can leverage this performance to obtain higher rates yet still win the award. This is another reason why a GSA Schedule is a useful entry point into federal contracting.