The Navy’s new preferred supplier program

by: Nichole Gunn May 26, 2010

On Monday May 24, 2010 the Navy pitched a new incentive program called the Preferred Supplier Program (PSP). The Navy Times reports that this program will provide incentives and more favorable contractual conditions to those government contractors who display excellent performance.

So what exactly does the Navy consider excellent performance? In order for the contractors to receive the preferred supplier status and receive incentives they must consistently exhibit superior behavior in cost, schedule, performance, quality and business relations..

The Navy’s pilot preferred supplier program is, for now, still in its ‘conceptual phase’ and is expected to be launched on October 1, according to the Navy Times. The Navy will rely on the Contractor Performance Assessment Reporting System for baseline data.

This week the Navy has also signed contracts, worth over $400 million, with three US defense companies with the intention to purchase shipboard data networking equipment.


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