1. New Employee Training Market Research
Air Force Materiel Command
War-Winning Capabilities … On Time, On Cost
New Employee Training Market Research
Module Lead:
WR-ALC
July 07
Integrity ~ Service ~ Excellence

2. Course Overview Length: 1 Hour Method of Delivery: Slide Presentation
Course Contents: Overview of the Market Research Basics

3. Overview Training Objectives Market Research Policy
What Market Research Is
Market Research Goals
Process Steps
Techniques
Example
Participants
Tools
Documentation
These are the topics we’ll be covering today.

4. Training Objectives Objectives
Review Policies Requiring Market Research And The Government Mandate To Conduct Market Research
Explain The 6-Step Market Research Process
Identify Key Elements To Successful Market Research Program

5. Market Research Policy
Federal Acquisition Regulation (FAR) Part 10 states that Market Research must be conducted:
Before developing a new requirements document
Before soliciting offers for acquisitions with an estimated value in excess of $100,000
Before soliciting offers for acquisitions with an estimated value less than the simplified acquisition threshold when adequate information is not available and the circumstances justify its cost; and
Before soliciting offers for acquisitions that could lead to a bundled contract (15 U.S.C.644(e)(2)(A)).

6. Market Research Policy
FAR - Part 7 Acquisition Planning
FAR 7.102: Requires market research for all acquisitions; promotes and provides for acquisition of commercial items/services and full and open competition
FAR 7.105: Requires Acquisition Plans to address extent, results, and impact of market research
FAR 7.107: Requires market research to determine necessity and justification for bundling (“measurably substantial benefits”)
Note: Acquisition Planning includes sustainment activities.
Policy.
(a) Agencies shall perform acquisition planning and conduct market research (see Part 10) for all acquisitions in order to promote and provide for --
(1) Acquisition of commercial items or, to the extent that commercial items suitable to meet the agency’s needs are not available, nondevelopmental items, to the maximum extent practicable (10 U.S.C and 41 U.S.C. 251, et seq.); and
(2) Full and open competition (see Part 6) or, when full and open competition is not required in accordance with Part 6, to obtain competition to the maximum extent practicable, with due regard to the nature of the supplies or services to be acquired (10 U.S.C. 2301(a)(5) and 41 U.S.C. 253a(a)(1)).
(b) This planning shall integrate the efforts of all personnel responsible for significant aspects of the acquisition. The purpose of this planning is to ensure that the Government meets its needs in the most effective, economical, and timely manner. Agencies that have a detailed acquisition planning system in place that generally meets the requirements of and need not revise their system to specifically meet all of these requirements.

7. Market Research Terms
Market Research - A continuous process for gathering data on product characteristics, suppliers’ capabilities and the business practices that surround them (customary terms and conditions, including warranty, buyer financing, and discounts under which commercial sales are made, etc.) – plus the analysis of that data to make acquisition decisions.
Includes:
Market Investigation
Market Surveillance/Intelligence

8. Market Research Use results to:
Determine if sources capable of satisfying our requirements exist
Determine if commercial items are available, or if not, are there nondevelopmental items that:
Meet agency’s requirements
Could be modified to meet them, or
Could meet requirements if those requirements were modified to reasonable extent

9. Market Research
Determine extent commercial items could be incorporated at component level
Determine practices of firms engaged in commercial business:
- Warranties - Maintenance
- Buyer financing - Marketing
- Packaging
Ensure maximum use of recovered materials
Assess availability of electronic and IT technology (AFWAY)

10. Terms & Definitions
Market Investigation is a comprehensive survey of the market place to gather information in response to a specific contract requirement.
Market Surveillance/Intelligence is an ongoing process and includes all the activities that acquisition personnel perform continuously to keep themselves abreast of technology improvements, product developments, and commercial business practices relative to their areas of expertise. Data gathered during Market Surveillance/Intelligence activities are very beneficial for tailoring operational requirements to take advantage of commercial item products and services which already exist in the market place.

11. + What Market Research Is Market Research is the sum of two processes
CONTINUOUS PROCESS FOR GATHERING DATA
Suppliers’ capabilities
Product characteristics
MARKET RESEARCH
Surrounding business practices
Plus the analysis of that data to make acquisition decisions
Market Research is the sum of two processes +
investigation
surveillance

12. Market Research Process Steps
Define Your Requirement
Review Historical Data (Summarize Current Market Surveillance Data)
Develop Your MR Strategy
Assign Roles and Responsibilities
Identify Available MR Tools to be Used
Conduct MR Activities Consistent With MR Strategy
Survey the Marketplace (Gather the Data)
Identify Sources
Evaluate products, services and capabilities
Document Your MR Results and Findings
Archive the MR Report
Share Your MR Data
Identify Lessons Learned
Use the Report to support your Acquisition Strategy Decisions
It is imperative that the acquisition team define what it is they are trying to purchase before implementing a market research program. Vagueness of requirements will confuse your market survey processes.
The first part of a market investigation is to review and summarize what you already know from your market surveillance activities. The market investigation can then be targeted to answer specific questions and to fill in gaps in information.
Develop a market research strategy that will clearly assign roles and responsibilities to the appropriate acquisition team members. Determine what approach will be used to survey the marketplace and identify available tools that can be used to assist in conducting your market research activities.
The survey of suppliers may consist of a few telephone calls, or it may be a comprehensive questionnaire sent to a group of potential suppliers, or it may involve the evaluation of product samples. If you decide to use a mail survey, a cover letter or introduction explaining the survey goals and the expected size of the acquisition and a follow-up contact may increase the response rate. Personal contact is best because it provides an opportunity to answer any questions about the survey. The follow-up step is particularly important for encouraging suppliers who have not participated in defense work to respond. The market analyst must identify potential suppliers of acceptable commercial items or services. The potential sources will be asked to participate in a market survey and furnish information on their products or services. In some industries or for some items, everyone may know the suppliers and their products or services. In that case, little effort is required to generate a list of potential suppliers. Other, more diverse industries require considerable effort to identify sources of acceptable products. Adding new potential sources to a list of suppliers increases competition, which can lead to better products at lower costs for the Department of Defense. In some cases, yours may be the first attempt to meet the requirement with a commercial item, and more effort may be required to identify as many potential sources as possible. You may need new techniques to reach sources that have not previously dealt with the government.
After receipt of the information, it is important to analyze the data to determine whether the information received is sufficient to determine whether the product or service meet the needs of the requirement. It is not uncommon to get incomplete or erroneous data from suppliers. In some cases, you may need to contact an applications, field service, or design engineer for clarification of issues. You may need to appraise the survey information using market surveillance information, analyzing market trends to fill in missing data. For example, you can estimate an end of production date for a product for which you have no data by analyzing comparable products for which data exists and is available. If a written survey is overly burdensome, many suppliers will not respond. Be careful to request the minimum amount of information you need to make your acquisition decision.
The fifth part of a market investigation is to evaluate all the information acquired during the investigation and determine whether a commercial acquisition is feasible. The result may be a determination that it is not feasible; that commercial products or services meet the need as stated; that commercial products or services can meet the need if certain requirements in the original statement are relaxed; or that commercial products or services could be modified to meet the requirement.

13. Market Research Goals
Expand Use Of Commercial Item Solutions And Commercial Practices
Identify Emerging Technologies
Address Current Obsolescence Issues
Expand Use Of Non-developmental Item Solutions
Assist In The Development Of Your Acquisition Strategy:
Tailor Contract Terms And Conditions
Identify Small Business Opportunities
Promote Best Value Acquisitions
Provide A Good Understanding Of The Market Sector

14. MARKET RESEARCH TECHNIQUES
Update Past Market Research
Review Similar Market Research Reports on File
Issue Surveys and Questionnaires (Sources Sought & RFI)
Conduct Site Visits
Perform Internet Searches
Host Industry Days

15. MARKET RESEARCH TECHNIQUES (Cont)
Contact Small Business/Source Development Office
Review Trade Journals
Contact Professional Societies
Attend Trade Shows
Cold Calling (Yellow Pages)
Contact Professional Contacts
Note: The above list is not all inclusive of standard market research techniques.

16. Example Market Research Program
Buying a new car:
Look at brochures (Commercial Data Specifications)
Visit Dealerships (Site Visits)
Attend car shows (Trade Shows)
Ask friends, relatives, coworkers (Contacts)
Read ‘Consumer Reports’ for best buys and most reliable cars (Trade Journals)
Conduct an Internet Search (Market Survey)
Yellow pages: Look up dealers in your area (Source Identification)
Ask dealers about financing plans, discounts, warranties, options, etc. (Terms and Conditions)

17. Example Market Research Program
Buying a new car:
You performed market research by...
…gathering and analyzing information about the capabilities of the new car market to satisfy your car needs.

18. Who does Market Research?
Technical Team
Logistics Specialist
Cost/Price Analyst
Finance
The Acquisition Team
War-Fighter/User
Legal Counsel
Program Manager
DCAA/
DCMA
Small Business
Contracting Officer

19. Who Conducts The Market Research?
Rule of Thumb!
1. The Technical Staff (i.e. engineer, scientist, and equipment specialist) is responsible for conducting the market research.
The program manager is responsible for ensuring the market research is conducted.
The contracting officer should not proceed with any acquisition unless adequate market research has been accomplished.
The Acquisition Center of Excellence or policy office is available to assist everyone.

20. Market Research Key Elements Of Success
Start early
Involve users
Communicate as a team
Think of market research as an iterative process
Tailor the investigation
Refine as you proceed

21. Market Research Process Review
Define Your Requirement
Review Historical Data
Develop Your MR Strategy
Identify Available MR Tools to be Used
Conduct MR Activities Consistent With MR Strategy
Document Your MR Results and Findings
Archive the MR Report
Share Your MR Data
Use the Report to support your Acquisition Strategy Decisions

22. Market Research References
Standardized Document SD-2: Buying Commercial and Non-developmental Handbook
Standardized Document SD-5: Market Research
FAR Part 2, Terms and Definitions
FAR Part 7, Acquisition Planning
FAR Part 10, Market Research
FAR -- Part 11, Describing Agency Needs
FAR Part 12, Acquisition of Commercial Items
Hill Website:

23. Summary
Market Research is an invaluable source of data for use in optimal acquisition planning!
Tailor slide to ACE activity providing training module.