MARKET RESEARCH

Market research is the process of collecting and analyzing information about commercial capabilities and practices to determine the capability of the marketplace to satisfy agency needs. Generally, market research is conducted before developing new requirements documents and soliciting offers for acquisitions in excess of the simplified acquisition threshold of $150,000, and for acquisitions of less than $150,000 when adequate information is not available and the circumstances justify the cost. Market research may also be conducted on an ongoing basis within a segment of industry. This is done to keep up with changes in the marketplace that might affect future agency requirements and not as part of a specific acquisition plan.

It is important that all market research activity be documented and maintained in the acquisition file. Agencies should document the results of market research in a manner that is appropriate to the size and complexity of the acquisition being performed. This will permit easy access when planning future acquisitions and by other agency personnel with similar acquisition requirements.

Market research is most effective when conducted after the agency has made an initial determination of what it needs, when it needs it, how the agency will define contract success, and roughly how much it might cost. This information provides direction to the researchers regarding what to look for in the marketplace. Generally, market research is done during the initial stages of acquisition planning or, if this is not possible, at least before a final SOW or PWS is developed.

Market research is conducted to obtain information about what the marketplace has to offer—its capabilities, practices, and pricing policies. The results of market research are used to enhance the final description of the agency requirement.

When acquiring equipment or supplies, market research information includes who manufactures or can otherwise provide the required items, if there have been technological or other changes in how the items are manufactured or used, and if such changes would affect how the current requirements are described. It may also indicate that the current items are obsolete and that something new or different would better meet current requirements.

When acquiring services, the key concerns are how the same or similar commercial services are organized and staffed, the work outputs or products, performance indicators, performance standards, acceptable quality levels, and if technological advances and other innovations have changed how the services are performed.

The first step, however, is to conduct a desk audit, which is essentially a review of the information available in-house, and a literature search of appropriate trade publications and contractor marketing literature. A request for information (RFI) or a sources-sought synopsis may also be used in conjunction with the initial market research.

It is not unusual for an agency to revise its initial description of the requirement as a result of market research. Effective use of market research allows planners to meld agency requirements with industry capabilities and practices to produce a statement of work or performance work statement that permits industry the greatest flexibility to provide innovative solutions to meet the agency’s requirements.

FAR 10.002 (b)(2) suggests how market research might be conducted, identifying the following techniques:

•    Contacting knowledgeable individuals in government and industry regarding market capabilities to meet requirements

•    Reviewing the results of recent market research undertaken to meet similar or identical requirements

•    Publishing formal requests for information in appropriate technical or scientific journals or business publications

•    Querying government databases that provide information relevant to agency acquisition

•    Participating in interactive, online communications among industry, acquisition personnel, and customers

•    Obtaining source lists of similar items from other contracting activities or agencies, trade associations, or other sources

•    Reviewing catalogs and other generally available product literature published by manufacturers, distributors, and dealers or available online

•    Conducting interchange meetings or holding presolicitation conferences to involve potential offerors early in the acquisition process.

FAR 15.201(c) identifies the following techniques to promote early exchange of information:

•    Industry or small business conferences

•    Public hearings

•    Market research, as described in Part 10

•    One-on-one meetings with potential offerors

•    Presolicitation notices

•    Draft RFPs

•    RFIs

•    Presolicitation or preproposal conferences

•    Site visits.

These techniques should all be considered, used as appropriate, and documented as market research. There is no single way to conduct market research. It is a continuing process, starting during acquisition planning and continuing until the solicitation is released.