Government purchases T&M equipment on the Web

Peter Ostrow of TestMart

Q Tell us about TestMart/NAVICPmart and its mission; does it replace another system?

A Manufacturers and sellers use TestMart to increase their military, government, and commercial sales. Buyers rely on TestMart as an honest and efficient marketplace for purchasing test-and-measurement equipment. Headquartered in San Bruno, CA, TestMart is a privately funded company. TestMart operates two main equipment e-commerce services—one under prime contract to the Department of Defense/Naval Inventory Control Point (NAVICP) for the benefit of the military, the federal government, and select prime contractors. The second marketplace is operated for the benefit of sellers and buyers in the commercial arena.

TestMart operates two main service businesses to parts of the industry as well. In the military, federal government, and select prime-contractor marketplace, TestMart offers manufacturers of test equipment, such as Aeroflex, Anritsu, and Fluke, a service that helps the manufacturers increase the sales of their products under General Services Administration contracts (GSA). TestMart manages contracts, supports sales teams and lead-generation efforts, provides transaction and reporting services, and handles part of the customer fulfillment process. Most of these arrangements are exclusive, fee-based ones.

The second service offering is one that started with an exclusive arrangement with eBay, whereby sellers of test equipment that wish to sell their items on eBay can use a listing tool and sign up for certain added marketing and logistics and calibration services offered through TestMart. The tool is located on the TestMart site.

Since the launch of the service with eBay, TestMart has added a similar feature to our own site whereby sellers can offer their equipment for sale on the TestMart site with the ability to add marketing and logistics and calibration services.

Specifically, the contract was let to TestMart to augment a process that takes place inside federal contracting law—that is, allowing one federal entity to purchase off of another's preexisting contracts. TestMart's contract was designed to enable the widest groups of eligible military, federal government, and select prime contractors to take advantage of extremely price-competitive pre-existing and pre-competed federal contracts for name-brand test equipment that are let out of NAVICP in Mechanicsburg, PA.

Almost every major test-equipment brand has one or more products on contract with the Naval Inventory Control Point. The total number of products offered in this catalog, however, does not typically cover the full spectrum of general-purpose test equipment requirements.

Therefore, augmenting the NAVICP contract products in this marketplace is a larger set of products that are also pre-competed under GSA schedules. TestMart does extensive outbound marketing to promote the service, and it has grown significantly since inception in late 2001.

Q What have been the major challenges in implementation? In continued service?

A The customer-awareness program has been the single most difficult challenge surrounding this marketplace. Specifically, regardless of how good the prices are and how great the site and service is, the US federal, military, and prime-contractor prospect and customer base is geographically and organizationally diverse—with many organizations having different buying habits or procurement regulations.

Especially in the beginning, many organizations did not believe that the deals were as good as they are or that the organization was eligible to buy under contract. We have created significant amounts of documentation (some of which is available directly on the site) to answer these questions.

Q In practical terms, how does an e-commerce system benefit the Navy and its suppliers?

A For eligible military, federal government, and select prime contractors, the e-commerce system provides:

• Discounts on a large set of test products.Many of the discounts are a factor of ten better than what one organization can typically negotiate on its own.
• Pre-competed products. The service offers Government Wide Acquisition Contracts (GWACS) as well as GSA schedules (many of the GSA products are only available on GSA schedule through TestMart)
• Research material. The service features the industry's largest and most easily used set of information on the equipment including specs, archival data, application notes, training data, cross-reference data, and so on.
• Ease of use. A Web site and a customer-service department allow users to automate or high-touch any percentage of the transaction that they want.
• Convenience. We accept credit and debit cards, project orders, purchase orders, wires, and funding documents such as MILSTRIP (a script-like funding document used by the military).

For the manufacturers, the e-commerce system provides incremental sales, access to a customer base that is hard to get to, and, for those that take advantage of the additional GSA services that TestMart offers, other benefits such as managing contracts, parts of lead generation and sales team support, transaction and reporting services, and part of the customer-fulfillment process.

Q How have test-and-measurement equipment vendors participated in the program? Are there particular delivery problems and solutions you have encountered?

A Most vendors have embraced the program enthusiastically. In one case, the vendor was much slower to support the initiative (it eventually did), and this cost everyone time and money. The Navy's commitment to this program ultimately convinced everyone that it is also in their best interest. Today, when manufacturers bid on a NAVICP test-equipment contract, they are required in the language of both the original solicitation and the ensuing contract that they must take orders through this service.

Interestingly enough, this has not seemed to discourage interest among even the most initially recalcitrant OEMs.

For more information, contact Peter Ostrow at peter@navicpmart.com.