Is Full and Open Competition Dead?

April 6, 2017

by Shelley Hall

Are COs being discouraged from using full and open (F&O) competition procedures?  When I was a CO, there were a lot of F&O competitions being done, but now it’s hard to find a single acquisition that is being done that way.

Full and open competition used to be the way most acquisitions were done.  In fact, if you were NOT using F&O, you had to (1) provide a justification as to why not or (2) have a statutory exception to F&O (reference FAR 6.302).  F&O simply gives every company, regardless of their size, an equal opportunity to bid.

However, with the overall government push for more set-asides for socioeconomic categories, F&O competitions are becoming pretty rare.  So let’s look at both sides of the situation to get a better feel for how and why the changes occurred.

There have always been a lot of valid reasons for using F&O, including:

(1) the requirement cannot be performed by a small business (building an F-16, for example)

(2) market research fails to validate that there are at least two capable, responsible (as defined in FAR Part 9) small businesses

(3) the requirement may be so complex or technically challenging that there is little evidence that small businesses can safely perform the work (such as launch support contracts)

The acquisition process has changed significantly in recent years creating a leaner process and more stringent guidelines.  Some of the reasons that F&O competitions have begun to disappear include:

(1) COs are being driven to use set-asides for EVERY acquisition since Agency policies “highly encourage” their use

(2) Thorough market research is not being done

(3) There are more small businesses and they are upping their capabilities (this is a good thing!)

The FAR and its supplements, agency policy memos, Better Buying Power (whatever version we are on now), and local preferences (yes, these do exist) are all driving COs to do small business set-asides.  These include HUBZone, SDVOSB, and EDWOSB competitions.  GAO is taking a much firmer stance when a protest comes in challenging a F&O competition being done versus a set-aside.  Instead of having to PROVE that there are two are more capable, responsible small businesses (like in the past), it is assumed that there are, and a CO needs to detail and document making a decision to go F&O.  And, quite honestly, at some point, the CO just stops fighting and does a set-aside regardless of whether or not market research validates it.

Let’s talk a little about market research.  I find it shocking how little market research is actually done on most contracts.  While I agree that the level of market research should be consistent with the complexity and dollar value of the procurement, doing a quick Google search or Small Business Dynamic Search (SBDS) is NOT sufficient for most acquisitions.  Doing an SBDS may get you some results, but just because there are 500 companies listed under the assigned NAICS code, that does not mean than all of them are (1) capable, (2) responsible, or (3) interested.  You really need to do a Request for Information or Sources Sought Synopsis posted to both FBO and GSA E-buy and request capabilities packages to make an educated determination.

Now, having said that, let me give a shout out to small businesses.  In just the last 10 years, I’ve seen the emergence of a huge number of small businesses that are entering markets where they never even tried to before.  This is awesome!  And, I’ve said more than once that today, it is much harder to find anything that a small business can’t do and to find something they can.

If you are a contractor, feel free to challenge F&O competitions if you are confident that there are at least two small businesses that can and want to do the work.  Talk to your small business advocates and COs so they know that small businesses have the capabilities and should be considered.

If you are a CO, do thorough market research.  Make sure you can defend your decision to do either a F&O or a set-aside.  Do not feel compelled to go one way or the other by “policy”.  Be bold and make educated decisions.

I can make an argument for either side.  Sometimes it’s the right decision to do a fully and open acquisition and each CO needs to make the correct decision based on all the factors.  But if there is valid evidence that two or more small business (in any of the socioeconomic categories), then it is unlikely the CO will be able to justify F&O.

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