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I wrote the following post out of frustration.  It occurs to me that anyone reading this post will be able to identify some ways for our government to save money.  The fact that this amazing bureaucratic mess is allowed to continue tells me that there is no desire to do so in Washington, D.C.   Anyone in Congress or the Administration that could read this and follow the links and not see places to save money qualifies as either a complete dolt or a full-time enabler of big government.  Here is my rant:

Our Company is very small.  There are only 7 of us now since the economy has tanked (especially the construction industry).  We manufacture concrete batching and mixing equipment.  Almost 5 years ago, we obtained a GSA contract to enable us to sell our products to U.S. Government agencies.  We wanted the opportunity to sell to the government for a number of reasons including:  the government seems to be the largest potential customer for our product;  one of our products was designed to produce concrete in remote areas (think Afghanistan, etc.); it would be a good balance for us since our market is almost entirely the construction industry (little did we know the construction industry would all but die in late 2007).

Our contract is about to run out after 5 years and we are in the process of renewing it, or, I should say we are trying to renew it.  I am convinced beyond a shadow of a doubt that the U. S. Government, because of its paperwork requirements, does business with companies with the ability to do paperwork best, not necessarily those who can build the best products or provide the best services.

I will not go through the unbelievable maze of paperwork in detail, but will just give you a hint of the bureaucratic nightmare faced by any company that wants to do business with our government.  Consider spending the next 3 minutes reading what is written below and then try to fathom the time it would take to complete the actual application or renewal process.

For starters, let’s assume you want to know if you are qualified to be a contractor to the government.  Here is a link to find out if you qualify.  To get a feel of how this works, click the link to the Federal Awardee Performance and Integrity Information System.  This will lead you to need to understand the Federal Awardee Performance and Integrity Information System (FAPIIS).  Oops.  That page can’t be found.  I guess you now have to click the link to “contact us” to find out about the FAPIIS and what you need to do to qualify.  The “contact us” link takes you to an email which allows you to ask your question.  You hope that you will get a return email within a day or two.  I’ll save you the trouble of waiting because it often takes two or three tries and many days to get a response.  They will tell you that you need to fill out an application and send copies of your financials for the past three years.  You also need to fill out a one page summary of what those financials mean.  Remember, this is to find out if you qualify to apply for a contract.  Forget the fact that you are wondering why the Government needs to have your financials to buy a piece of equipment from you.  Forget that you are a private company and the government already has most of that information in your tax returns.  Forget that as a private company, you don’t think the government should have the right to that information.  Just comply with all the requests for information and wait.  Maybe they will tell you that you are qualified to apply for or renew your contract allowing you to offer your products to the government.  Maybe.

Remember, this is only the start.  This is just what is required to find out if you qualify to apply to sell to the government.  The actual application is 65 pages (5 years ago – I’m sure our renewal will far exceed this).  It may be a bit picky on my part, but I think it’s a bit excessive to require about 6 to 9 months of application process and probably about 100 to 200 hours of administrative time to get on the list of products so the government can buy from you.  You can hire a government authorized contractor who will make the application for you for around $10,000, but you still have to provide them with all the information.  They just know how to organize it without referring to 20 different government offices.  When they joke about $250 hammers, it is hard not to realize that the hammer is worth about $25 and the administrative overhead to sell it to the government is about $225.

One more small example and I will stop boring you.  One of the myriad laws with which you must comply is called VETS100.  It is the Veterans hiring law.  You must register your company with the Department Of Labor so they can get from you an annual report of how you are complying with the Veterans Hiring Act.  The process is simple by government standards.  You send in a New Company Registration Request.  They send you an email confirmation.  On that confirmation, you get  a validation code that you must use to confirm your registration.  Here is an actual sample “validation code:”    06CFBB2C73C8DD7E702B9BEA14AC641D82F843D5    I think I counted right.  That’s 40 characters.  If it were numbers only, that would represent a Duodecillion or 10 to the 39th power of combinations.  Since 10 to the 14th power is a Trillion, I think this may be a bit of overkill.  Why couldn’t the validation code be something like A3344D?  That would give them about 7 million codes, surely enough for all the companies who might want to deal with the U.S. Government.  It would be interesting to hear a government official defend the need for a 40 digit validation code so you can confirm that you want to register with Department of Labor so they can collect more data from you…..but not interesting enough to ask someone to do it.

I almost forgot.  For the privilege of being able to offer our products to the government, we get to pay 0.75% of any contract we receive to the GSA for their services.  During the past 5 years, less than a half of one percent of our sales have been to the U.S. Government.  If we were not working in such a depressed industry and did not need every sale we could get, we would tell them to take a hike.

Does this give you any ideas how we might cut government costs?

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