President Trump’s March 20 executive order “Eliminating Waste and Saving Taxpayer Dollars by Consolidating Procurement” has major ramifications for GovCons. It will drastically change government acquisition by making the General Services Administration the lead for domestic federal procurement for common goods and services.

The executive order affects the use of government-wide acquisition contracts, or GWACs. By making GSA responsible for guiding the acquisition of common goods and services, the federal government is trying to optimize its spending and improve services delivery, according to the law firm Holland & Knight.

The U.S. spends roughly $490 billion per year on common goods and services via federal contracts. GSA was created in 1949 via the Federal Property and Administrative Services Act to bring an “economical and efficient system” for bedrock procurement services for agencies. GSA, in this role, has managed the Federal Supply Schedules program and created other GWACs, such as Alliant, VETS, OASIS and 8(a) STARS vehicles.

But other agencies have created their own GWACs over the years, such as the NASA Solutions for Enterprise-Wide Procurement vehicle. The executive order directs NASA and other agencies that created their own GWACs to discontinue their vehicles.