There is much to understand about federal contracting, especially between your Schedule Solicitation document and the Federal Acquisition Regulations (FAR). But there is also a lot to gain in the federal market.
One illustration is with a manufacturer who provides distributors a 50% discount, retailers a 30% discount, and the list price for general public is no discount. When negotiating with the Contracting Officer for your GSA offerred prices, this manufacturer must make the argument that the federal purchaser is most like a retailer or end-user. If the manufacturer fails here, and their proposed pricing shows equal or better pricing being given to a customer other than the GSA (the distributor’s discount of 50%), then the GSA may reject the proposal, distributors will be unable to earn a profit from Federal sales, and will be cut-out of that market entirely.
Once negotiations are settled, and a GSA Contract is awarded, the “Basis of Award” will be on the MFC whose prices best relate to the GSA offered pricing. Furthermore, if the basis of award (e.g. Commercial List Prices) are ever lowered in the future, a company is contractually obligated to decrease the GSA pricing as a ratio. So, if you lower your pricing to an end-user as a way to make a big sale, your GSA Contract is legally and contractually affected by that transaction.
When you are obtaining a GSA Contract, it is likely that the pricing section carries the most important because pricing has the biggest impact on a company's bottom line. A concern which is commonly brought up is “Do I have to give the GSA the lowest price that I can offer?”
The response is both yes and no. Yes, a company must give the GSA pricing that is equal or better than your Most Favored Customer (MFC), yet the MFC can be picked as your current customer with purchasing patterns most similar to those anticipated for government purchasers.