An Amazon for DoD? Not so fast

The local hardware store had empty bins for nearly everything I went in for.  As a boomer with the impatience of a millennial, I turned to Amazon. What the store clerk said on Friday he could get  on Tuesday, Amazon delivered on Saturday and Sunday.

I remember when most stores were closed on Sunday. Imagine getting a torque wrench made in Taiwan delivered to your front door on a Sunday.

This crazy phenomenon of being able to search 100 vendors for the best deal on wrenches brings together people’s drives for choice, bargains and near-instant gratification — all powered by competition.

Now it has attracted Congress — in particular, Mac Thornberry, chairman of the House Armed Services Committee.  A bill he sponsored would have the Defense Department use online marketplaces for buying commercial goods. The language looks as if Jeff Bezos wrote it. Some contractors believe Amazon was in fact behind this provision of the bill, which will end up included in the 2018 National Defense Authorization Act.

Now, as our Meredith Somers reports, Thornberry redid the wording to this provision. I’m guessing a lot of people noticed that it read like a reverse engineering of Amazon. Reseller and distributors in the federal market felt it could potentially lock them out. When I read the first draft, I wondered whether supply authorization agreements between manufacturers and their channels would somehow get bypassed. That could increase the government’s chance of obtaining dated, counterfeit or un-warranteed items.

And what about quality? I also bought chrome-plated switch plates. They’re made in the USA, implausibly. And although they are nicely finished on the outside, the rear edges are raw, not sanded smooth.  I cut both hands opening the cellophane packages. What if a soldier or sailor is changing out an MRO part on some piece of equipment and poor finishing means they don’t quite fit or they slice through gloves in the North Dakota winter? Would an online market allow for engineering samples?

In defense of Thornberry, he said back in May he would be open to amending the electronic marketplace proposal. Back then, the industry groups’ misgivings centered in part on what a commercial electronic market would do to the federally-operated markets like Fedmall. Roger Waldron of the Coalition for Government Procurement says they’ve been good for small business.

The idea of an Amazon-like market is the latest iteration of a durable idea, namely getting the government to buy commercial items in a commercial way. But if small business participation and competition remain statutory requirements of federal buying — and no one argues they should not — then purely commercial systems will never quite take hold. But electronic markets could ease buying friction and boost transparency. Amazon is not the only way to get there.

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