Market Research (FAR Part 10) is conducted to determine the availability of commercial products and services and to identify and evaluate market practices. It’s a continuous process of finding viable sources of goods and services to meet government requirements and is mandated for all acquisition programs. It’s conducted by key members of a programs Integrated Product Team (IPT) with the goal of pulling together the necessary market information to be analyzed so an informed decision can be achieved on how to satisfy a need. The results of market research and future plans for market research are included in a programs Acquisition Strategy.

Definition
“Market research is a continuous process for gathering data on product characteristics, suppliers’ capabilities, and the business practices/trends that surround them — plus the analysis of that data to make smart acquisition decisions.” (FAR 2.1)

Federal Acquisition Regulations (FAR)

  • FAR Part 8 “Required Sources of Supplies and Services”: provides a list of potential sources in priority order that Program Managers/IPTs must go thru to conduct market research.
  • FAR Part 10 “Market Research”: prescribes policies and procedures for conducting market research to arrive at the most suitable approach to acquiring, distributing, and supporting supplies and services.

Market research is intended to determine and help: [1,3]

  • Determine if sources capable of satisfying the agency’s requirements exists
  • Determine the extent to which commercial items or nondevelopmental items could be used to meet agency requirements.
  • Determine the practices of firms engaged in producing, distributing, and supporting commercial items, such as type of contract, terms for warranties, buyer financing, maintenance and packaging, and marking
  • Identify the availability (if any) of commercially available solutions
  • Identify customary industry terms, conditions, and warranties
  • Understand distribution and logistics capabilities
  • Uncover historical acquisition information
  • Ensure maximum competition
  • Reveal pricing information
  • Ensure maximum practicable use of recovered materials (see Subpart 23.4) and promote energy conservation and efficiency
  • Determine whether bundling is necessary and justified

Sources of Information
FAR Part 8 “Required Sources of Supplies and Services” provides a list of potential sources in priority order. Once you’ve satisfied that requirement, you can expand your search, preferably for a commercial off-the-shelf (COTS) solution or one which would require little modification to adapt, using various other means possible. These would include but not be limited to: [1]

STATUTORY. A stand-alone, Regulatory requirement at Materiel Development Decision (MDD). [1]

STATUTORY updates (as part of the ACQUISITION STRATEGY) required at Milestone A and the Development RFP Release Point; not required thereafter. Conducted to reduce the duplication of existing technologies and products, and to understand potential materiel solutions, technology maturity, and potential sources, to assure maximum participation of small business concerns, and possible strategies to acquire them. For programs responding to urgent needs, included in the Course of Action Approach at the Development Milestone. [1]

Defense Acquisition Guide (DAG) Chapter 2.3.10.3 “Market Research”
FAR Part 10 requires the Acquisition Strategy include the results of completed market research and plans for future market research. (See also the JCIDS Manual ). Market research information provided in the Acquisition Strategy should be sufficient to satisfy the requirements of 10 USC 2366b. For the Milestone B certification, compliance with 10 USC 2377, 15 USC 644, WSARA Sec 202, other statute & Defense Federal Acquisition Regulations Supplement (DFARS) determines the outcome of the market strategy certification element. Market research should yield an understanding of potential material solutions, their technology maturity, and potential sources, and should suggest strategies for acquiring them.

Market research is a primary means of determining the availability and suitability of commercial items and the extent to which the interfaces for these items have broad market acceptance, standards-organization support, and stability. In addition, market research is important in seeking small business capabilities. Thorough market research needs to be performed to determine whether or not small businesses are capable of satisfying the requirements. Market research supports the acquisition planning and decision process, supplying technical and business information about commercial technology and industrial capabilities to arrive at the most suitable approach to acquiring, distributing and supporting supplies and services. Market research, tailored to program needs should continue throughout the acquisition process and during post-production support.

Market Research Report Format

  • Background Information
  • Product/Service Description
  • Performance Requirements
  • Available Sources (vendors)
  • Product/Service Data
  • Environmental Impact Considerations & Cert Requirements
  • Commercial Opportunities
  • Prevalent Business Practices
  • Technology Trends & Technology Insertion
  • Small Business Opportunities
  • Market and Pricing Issues, Terms & Conditions
  • Other Considerations
  • Government’s Presence/ Leverage in the Market
  • Market Analysis, Conclusions and Recommendations
  • Market Research Techniques Used/Functional Involvement

AcqLinks and References:

Updated: 7/11/2017

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