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    So does the fact that a requirement requires the use of a Gov't WMS alone make it non-commercial when the other functional areas of the requirement meet the commercial criterion of FAR 2.101?


    Answer

    The application of the definition of "commercial item" to a particular requirement can be a challenging one, where two well-intentioned individuals come to completely different conclusions. The key to your question is paragraph (3)(ii) of the definition in FAR Part 2, which permits minor modifications to an item and still allow it to be considered commercial:
    Minor modifications means modifications that do not significantly alter the nongovernmental function or essential physical characteristics of an item or component, or change the purpose of a process. Factors to be considered in determining whether a modification is minor include the value and size of the modification and the comparative value and size of the final product. Dollar values and percentages may be used as guideposts, but are not conclusive evidence that a modification is minor;

    The guidance above provides latitude to use good business judgment in making a determination. Only the contracting officer, with input of course from program officials familiar with the requirement, can determine if requiring the use of a Government Warehouse Management System is a "minor modification" in the context of the overall requirement. I would err on the side of conservatism, however. While using FAR Part 15 instead of Part 12 procedures is more involved, it may be worth taking that route rather than try to defend a commercial item determination that cannot be fully supported.


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