Procurement Network Expands Vendors’ Access to Information
It has been nearly 18 months since the Army’s Tank-Automotive and Armaments Command (TACOM) abandoned paper in favor of all-electronic contracts. The agency, however, is taking a “cautious approach” in its e-commerce strategy, because TACOM has unique equipment needs, said Patrick N. Watkins, an electronic business specialist at the command.
One of the growing areas in e-commerce today is reverse auctions. These are auctions where suppliers compete online to sell an item to a buyer. TACOM has yet to conduct any reverse auctions but it is planning to do so, Watkins said in an interview in Dearborn, Mich.
TACOM is a $7 billion a year agency that purchases and manages major weapon systems for the U.S. military services.
The items that are more suitable for reverse auctions are commodities, which are bought in large quantities and sold by many competitors, Watkins explained. “TACOM is trying to see whether auctions will work with military items.” But the command currently has many of its spare parts purchases tied up in long-term contracts with companies, and is not able to conduct any auctions until the contracts expire, said Watkins.
About 70 percent of TACOM’s commodity purchases—for items such as canvas, rubber products, tools, machine parts—are in long-term contracts currently, he said. TACOM has not yet quantified any potential cost savings from buying spare parts through reverse auctions. “We are trying to get feedback from vendors,” Watkins said.
Reverse auctions for TACOM will be conducted on the Web site of the Army’s Communications and Electronics Command at www.monmouth.army.mil.
Watkins noted that TACOM also introduced a vendor notification system that allows companies to receive e-mail messages on new solicitations and amendments, saving vendors web-scrolling time. That service is available at contracting.tacom.army.mil/vendreg.htm.
Because TACOM has five large sites, all of which purchase equipment separately, the command’s procurement network allows vendors to have “visibility” of contracting opportunities across all five locations, Watkins said. TACOM’s five major sites are in Warren, Mich.; Rock Island, Ill.; Picatinny, N.J.; Anniston Army Depot, Ala., and Red River Army Depot, Texas.
Each location, he said, has a “business opportunities” Web page, where vendors can find market surveys, open solicitations, technical data packages, procurement histories, contract awards, TACOM qualified-suppliers lists and other acquisition-related information.
Since June 1999, said Watkins, all TACOM contracts have been posted on the Web and paper copies are not made, unless it’s needed. For example, certain banks that do not conduct business electronically may require a paper copy of a contract before it will make a loan.
The one item that TACOM could not digitize, said Watkins, was a construction bond that required an embossed seal, issued by state and local agencies before a construction project could begin. That will change, he said, as soon as new legislation is signed, authorizing “electronic signatures.”