On March 20, 2025, President Trump signed an executive order to consolidate federal procurement under the General Services Administration (GSA). Framed as an effort to eliminate waste and save taxpayer dollars, the order mandates that federal agencies shift their purchasing of common goods and services to the GSA. While this move is being touted as a step toward efficiency, the reality may be far more complex for government contractors.
What Does the Executive Order Require?
The order mandates several major changes to how the federal government purchases goods and services:
- Agencies Must Transfer Procurement Authority to the GSA
- Within 60 days, federal agencies must submit proposals to the GSA outlining how they will shift purchasing of common goods and services to the agency.
- This applies to standardized goods and services used across multiple departments (e.g., office supplies, IT equipment, and certain professional services).
- The GSA Must Develop a Centralized Procurement Plan
- Within 90 days, the GSA must create a comprehensive strategy for handling procurement on behalf of all domestic federal agencies.
- This plan will define how contracts will be awarded, managed, and enforced under the new system.
- The GSA Gains Expanded Authority Over IT Contracts
- Within 30 days, the Office of Management and Budget (OMB) will designate the GSA as the executive agent for all government-wide IT procurement contracts.
- GSA shall defer or decline the executive agent designation for Government-wide acquisition contracts (GWACs) for IT when necessary to ensure continuity of service or as appropriate.
- The GSA will also be responsible for rationalizing the use of GWACs and eliminating duplicate contracts to improve efficiency.
- Within 14 days, the OMB must issue a memorandum directing agencies to comply with the order’s IT procurement provisions.
Potential Downsides: Bureaucracy, Delays, and Disruptions
While streamlining procurement sounds good in theory, there are serious risks:
- Increased Bureaucracy: Agencies may lose flexibility to purchase what they need when they need it, leading to operational slowdowns. A single procurement authority could become a bureaucratic bottleneck, delaying purchases and critical government operations.
- Potential for Higher Costs: If contracts are consolidated under a few large vendors, lack of competition could drive up prices instead of lowering them.
- Infrastructure Delays: GSA may lack the staffing and infrastructure to handle such a massive influx of procurement responsibilities in a timely manner.
What About Government Contractors?
Another major concern is the impact on contractors, particularly small and mid-sized businesses that rely on direct relationships with individual agencies.
- Will vendors be forced into larger, more complex contracts that favor big corporations with the resources to navigate GSA procurement?
- Will the shift limit competition by consolidating contracts into fewer, larger deals?
- Could this lead to higher prices instead of savings, as fewer vendors are able to compete under the new structure?
- Will smaller contractors that once had direct agency relationships struggle to compete for large, consolidated GSA contracts?
In the name of efficiency, the administration could be creating an environment where smaller businesses are squeezed out, and government procurement becomes even more challenging to navigate.
Will It Work? The Unanswered Questions
While the administration argues that this move will cut waste and enhance efficiency, major questions remain unanswered:
- How will the GSA handle this massive expansion of responsibility?
- Will agencies be able to obtain the goods and services they need in a timely manner?
- What impacts will this consolidation have on IT GWACs currently being performed and those pending award (e.g., CIO-SP4, SEWP VI)?
- What safeguards will be in place to prevent procurement delays and monopolization by a few large contractors?
- If the system fails, what will be the contingency plan?
Without clear answers, this executive order could end up as another well-intentioned reform that fails in execution, burdening agencies and contractors alike.
Conclusion
While the administration promises cost savings and efficiency, history suggests that centralizing procurement can just as easily lead to delays, inefficiencies, and unintended consequences. The success of this plan depends on whether the GSA can actually handle the task—and whether agencies and contractors can adapt without significant disruption.
For now, the executive order raises more questions than answers, and its long-term impact remains uncertain. Will this truly be a win for taxpayers, or just another layer of government red tape?
If you have questions about this order or have been impacted by the administration’s recent executive orders, please contact Sam Finnerty or another member of PilieroMazza’s Government Contracts Group. Also visit our Government Contract Executive Orders resource center for additional coverage.
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If you’re seeking practical insights to gain a competitive edge by understanding the government’s compliance requirements, tune into PilieroMazza’s podcasts: GovCon Live!, Clocking in with PilieroMazza, and Ex Rel. Radio.
