Attachment_4_Notes_for_HCMC_pre-proposal_conference_29Mar18.pdf

Pre-proposal Conference in HCMC For RFP 72044018R00004

Notes LinkSME Pre-Proposal Conference in Ho Chi Minh

March 29, 2018

Introduction: Mike Capobianco

Stephen Berlinguette: Welcome everyone. How did we get to this point? This is a new activity. USAID has been working a long time in Vietnam and signed bilateral agreement 2001. STAR and GIG have been working on the enabling environment and policy. The results have been great, and we’re proud of the work and progress we’ve been able to achieve.

Vietnam is open to trade and growing fast and has an amazing export orientation. There is still a disconnect between the export story and small and medium enterprises (SMEs) in Vietnam. Linkages between exports and Vietnam enterprises are still weak. Two-thirds of exports are managed by foreign enterprises, only one-third of Vietnamese (small, medium and large) are integrated into export supply networks. There is more work to be done with Vietnamese SMEs to address this. We want to help fill in the gap.

We have done legal reform and have supported the business enabling environment, now we are trying something different. We want to orient SMEs toward demand - by demand, we mean the export sector. Large companies that are exporting need supply chains; Is there some way we can help large companies increasingly build their local supply networks in Vietnam?

This is a nontraditional approach for us here in Vietnam. We want to try something a little different - we want to work with firms primarily, helping Vietnamese enterprises.

This is new for us. We will be trying different things. There will be a lot of learning involved, there might be some trial and error. We are optimistic and we are glad to see you are too.

Why are we here?

Giving info and process and more idea what USAID thinking. Also for offerors network to private sector. Private sector will lead the growing in the country.

This is not a regular contract - we are trying something new. We want to provide for more learning, we want to incentivize excellent performance.

Overview of Solicitation

Solicitation overview: This is not a normal USAID program. It is not a normal cost plus fixed fee (CPFF) award, it is a cost plus award fee (CPAF). There will be a longer period for responses. Any questions will be posted on Fedbizopps.gov.

Michael Trueblood:

LINKSME PURPOSE

This is NOT a traditional SME strengthening activity.

● We will not expect to provide trainings to SMEs and offer them business development services.

● Nor strictly working on SME policy, under the assumption that barriers to business expansion are solely a policy problem.

● Our assumption is that there are a myriad of reasons why local supply chains haven’t developed in Vietnam as they have in other rapidly developing countries.

This is meant to be transaction led:

● Working with SMEs and foreign invested enterprises (FIEs) to discover how linkages can occur

● We want know what the barriers are?

● What can we as USAID do to facilitate greater integration of Vietnamese SMEs and global value chains (GVCs) - both international and regional?

Despite the massive amounts of FIEs in Vietnam, there are few examples of SMEs and FIEs working together. Currently, only 21 percent of Vietnamese SMEs are a part of global value chains.

Do FIEs in Vietnam want to source locally if they could?

● We went out during the design phase and asked that question and found a resounding YES! They mentioned “speed to market” pressures are huge.

Sourcing locally would help a lot with time and costs.

● For local SMEs, they want growth opportunities, market access, and value addition

What else did we find in our discussions? The common thread companies wishing to source locally:

● Quality

● Quantity

● Timeliness

● Trust

This is where we want to focus – we want the contractor to help overcome these challenges and facilitate these transactions.

● Once an SME has a successful transaction, we believe, a virtuous circle develops and that SME will start to gain the resources needed to improve the business and invest more in it.

CONTRACT OBJECTIVES

“- Strengthen the SME-GVC Business Linkage Framework

- Enhance Vietnamese SMEs’ capacity to supply GVC firms in 5 sectors”

Simple, right? We want to emphasize again: This is NOT a status quo SME strengthening activity.

● We expect that there will be significant partnerships developed, in which both SMEs and FIEs gain experience and leverage “know how” as well as financial resources.

● There are many FIEs already working on expanding their local suppliers - we expect the contractor will partner with at least some of them.

We are requiring that the offerors provide USAID with sector analysis for seven sectors.

● Not only should this detail challenges and opportunities within a sector, but also potential partnerships with FIEs, associations, etc.

TECHNICAL APPROACH

“- Phase 1: Facilitate 10 transactions (linking SMEs to GVCs) in two sectors. Gather evidence.

- Phase 2: Replicate and scale transactions in five total sectors. Gather evidence.

- Phase 3: Institutionalize key reforms – transforming the enabling environment.”

First, what do we mean by the three phases and transactions?

● Phase 1 - 18 months; Phase 2 - 24 months; Phase 3 - 18 months

● Transactions are completed contracts between SMEs and GVCs

We are looking to achieve systemic changes

● There needs to be a lot of evidence about what works and why.

● We anticipate that there will be some things that apply to particular sectors or particular provinces, and not countrywide, and vice versa.

Over the life of the contract, the contractor must identify five sectors and really drill down deeply within each of those sectors to identify how to facilitate linkages.

● Our contractor will become an expert in these sectors and will proactively develop suppliers and buyers.

In the last 18 months of the contract, the contractor will take a step back and look at the SME sectors on a macro scale:

● What are the impediments and how can USAID contribute to improving the enabling environment?

The contractor must work to establish an SME advisory group. We anticipate that this would include a diverse group of influential stakeholders who can provide strategic advice during the duration of the contract.

Questions & Answers

Q1: You referenced that 21 percent of SMEs currently are contributing to GVCs, where is that calculation coming from? What definition of SME that USAID is using for this activity?

A1 USAID answer: For the 21 percent figure, we got this figure from the Ministry of Planning and Investment when they had listed that in a report that we had found at one point. The figure was estimated by the Asian Development Bank in its 2015 Outlook Report (p. 247). USAID has revised the definition of SMEs guided by the new Law on SME Support 2017 and feedback from the industry partners. SMEs are are now defined as less than 500 employees.

Q2: If you are going in agriculture, the 200 employees will be very difficult in the case fruit and vegetables in terms of amount of employees and processing. Our recommendation is that 500 employees is more reasonable if you are looking at agriculture. In terms of textiles and apparel, the 2nd tier or 3rd tiers are more labor intensive. For example, laundry facility in dyeing and garments has more people in the finishing. Limiting the definition of SMEs to 200 employees will hit very hard.

Audience discussion: If you are really talking about the smallest SMEs in Vietnam, up to 200 employees, these companies are facing the biggest difficulties today to be integrated and if out of these 21 percent who are already join the global value trade, this sounds very high. You have bigger potential for sure in companies up to 500 people to get ready to join global value chains.

Audience member suggestion: In terms of definitions, you might see multiple times it’s with “and” or “or”, so just adding an “or” to the definition might resolve the issues and the have greater impact incentives instead of just an “and”.

USAID Discussion: That is why we are here. We will go back and review and if we agree with you, we’ll make a change in the Q&A document and release a statement on FebBizOpps.gov with regard to changing the classifications of SMEs. We will see if we want to focus on the small firms and linking them to GVCs or going a little bit with the medium/large sized firms. We will also have to balance that with making sure that it’s in balance and harmony with GVN colleagues and their interpretation of law.

A2 USAID Answer: Please see Q1.

Q3 : What's the 21 percent translated to numbers of companies?

A3 USAID Answer: Based on data from MPI in 2017, we estimate that the 21 percent equates to roughly 82,000 firms that are registered and active.

Q4 : About SME definition: Is there any difference between SMEs in Vietnam and the ones in America? We want to link not only in Vietnam but also to SMEs in America.

A4 USAID Answer: No, they are different.

Q5: You plan to work in five sectors: is there any plan to focus on which sectors? Is now the time for us to discuss here which sectors?

A5 USAID Answer: We ask offerors to propose seven sectors, then will narrow down to the five. While we will do two in the first phase, that's the learning phase. Then we will do an additional three in Phase 2 for a total of five. So you propose seven, then we will narrow it down together to the five we will be ultimately working in. You can have discussions, but all discussions will actually be posted online. It’s more concerning from a competition standpoint of potential offerors to discuss which sectors they plan to propose and then sharing widely, and potentially give up some type of competitive edge. But this does not preclude you from discussing over coffee and networking. It just may not be appropriate to discuss with the larger audience here.

Q6: Can you expand a little more on purpose/vision and expectations for the SME advisory group?

A6 USAID Answer: Please note that this response is a little different from the conference discussion. USAID envisions the SME Advisory Group (AG) to be comprised of influential people representing a diversity of interests, e.g., international and domestic private sector, business associations, and the Government of Vietnam.

The AG will help steer the activity and provide strategic advice. For example, before making the final determination of the five sectors, members of the AG will provide their insights. It should be seen as a guiding advisory group - a steering committee of sorts.

Contractually, we are looking to the AG as a potential data point for reviewing the award fee evaluation. For example, for the first four years it sets aside for private sector engagement; the last 36 percent is meant to evaluate how much change and impact the program has had. We will reach out the AG to give opinions and certain data points for the award fee evaluation.

Q7: Vietnam exports to many countries. Are you gearing towards the United States as the destination of the supply chain? What about other countries like Japan, China, and the EU? Also the CPTPP trade agreement is coming into effect with 10 other countries.

A7 USAID Answer: We are not seeking necessarily exports to the United States. The focus is on supporting small and medium enterprises in Vietnam. We are seeking conclusive growth outcomes. We want to help parts of the economy that are as participatory as others, and where these exports go, we are trying to be agnostic.

Q8: Regarding the timing of the phases (18 months to execute a transaction), it would be really helpful to talk about the time it takes to execute a transaction. We should understand that if we are defining an SME in the current description, and that SMEs are not necessarily participating in the GVC economy, and they are expected to then participate and execute the transactions in 18 months, then that is a lot to expect. It will be interesting to think through and discuss more in detail for 10 transactions over two different sectors.

A8 USAID Answer: Please note that we will look for SMEs that have the most impact, and in Phase 1, we are requiring that the transactions have been fully executed. After review, USAID anticipates the first two phases to be 24 months and the final phase, 12 months. However phase length is not set and is dictated by circumstances specific to the individual sectors.

Q9: Is there a number of transactions needed for Phase 2?

A9 USAID Answer: The implementation plan for Phase 2 will be defined and formed by learning that is conducted in Phase 1, so we purposely did not specify the number of transactions in Phase 2. The purpose of transactions is learning that’s gained from those transactions to help us understand what truly are the barriers preventing SME firms from entering global value chains. Transactions are the way to get to that, or a way to do that learning. Maybe the best way is learning by doing. We expect contractors to take the information and learning they get to identify the barriers, make some changes try to adjust and do some more transactions on a greater scale.

We will see and if something does not work we will get some more data points and we learn again. This is a learning type of award and it is inherent in the award fee plan, which has as one of the factors monitoring and learning. We expect the contractor might fail and not always succeed, but will take the lessons learned, scale it up - learning and doing, and move to Phase 3 for institutionalized reforms. It is part of the reasons that we did not identify any specific number of transactions for Phase 2 because it is formed by continuous learning.

Q10: Is it feasible to execute 10 transactions in the 18 month period?

USAID asked for audience discussion of this question.

Audience comment: Transactions are the last thing we choose to have done or the last thing in this whole picture. Before you set up a deal with suppliers in Vietnam, you need to go through a long evaluation process in the training process to get the firm ready for a transaction. This takes a long time and requires building trust first, then connecting buying partners with selling partners, having the right time schedule and the right quality and quantities. In your RFP, you set a couple of months or 10 months or whatever for data collection. This time is not available for developing transactions, so I think it would be very difficult in Phase 1.

Audience comment: Let’s go back to which sectors. If you look at apparel, if you are in the fabric dye process, it takes about 4-8 weeks once you finalize the order placement.

If you go into seafood, it only takes 10 days to start if the raw materials are ready but requires 9 months for the growing period. So looking at the proposals, it would be better to consider the timeline based on sector-specific information and the background of that sector to verify why the timeline is that way, rather than put a short hard stop deadline.

As they go to seven sectors, each would need to be verified as many sectors may overlap. You can divide within the same sector to see who has comprehensive knowledge and in-depth understanding of the industry. Rather than a hard stop, it might make more sense if we set a goal and go through each sector and define it differently, as once you get through it you understand the relationship before the first order goes in.

There are a lot of issues to consider. This is huge undertaking by USAID, the GVN cannot figure it out. This is great - knowledge sharing, plan of actions, and put into something in business school as a case study.

Audience Comment: Can a transaction be an initial relation established between a manufacturer and supplier? For example, a manufacturer comes in and meets with a supplier to exchange information about their needs, quantity, quality of products, delivery, trust, etc. A transaction is a long process. It would take a long time, up to 2 years, for a supplier to get up to speed. The supplier might need to build up skills and capacity and to study the manufacturer's process. The manufacturer might make commitments with the supplier to build up their skills. Therefore, can the first phase be adjusted to 24 months?

Audience Comment: What about technical support? For a long-term commitment, the checklist (tasks) may not be in a fixed order; they can be simultaneously implemented depending on the supplier’s needs (based on customer needs). For example, for a long-term commitment with a checklist for a SME company (as a supplier) with 200 employees, support can be related to a strategy, a (6-month) business plan, organization, production processes, equipment, technology, mindsets, etc. It depends on the prior needs of the company.

A10 USAID Answer: Three subjects mentioned by the audiences are interrelated: (1) the size of SME, (2) how long is this phase, and (3) the definition of a transaction. The reason we are doing this by not defining the sectors is that we want our bidders to do the analysis to get to the issues you have identified and which sectors will result in the greatest impacts. For instance, if you are looking at a sector of primarily “mom and pop shops,” are the barriers there going to be greater than, for example, an automotive or light manufacturing sector?

We assume that once a firm secures transactions, then it will increase revenues in the long term. USAID is not going to define sectors, it is part of the analysis of the prime offeror. USAID is giving a lot of time for the RFP period to allow bidders sufficient time to conduct necessary and appropriate analyses to identify which sectors will have the most impacts. The evaluation will be based on the best ideas along with issues identified and solutions. We are looking for an offer that has analyses presenting a balance between impacts and feasibility.

Q11: Would USAID consider the ongoing Coca-Cola-funded “SMEs link to Coca-Cola supply chain” activity as a transaction? It is evidence based. At the beginning, they selected 20 SMEs in 3 sectors: packaging, 2 logistics, 3 high-tech agricultural products.

After 6 months, they sorted out 6 companies in 3 sectors for providing them with mentoring and training as well as a study tour on production chain. After one year, they signed MOUs with 6 SMEs in 3 sectors who meet Coca Cola’s requirements for the Vietnamese SME suppliers. They are going to continue with another 6 SMEs this year.

A11 USAID Answer: Please refer to USAID’s definition of a transaction in the RFP.

Q12 Audience comment: We recommend to segment by sector. I think it makes more sense.The supply chain is pretty long and you have to go from tier to tier. Even during a five year period, you cannot expect a company to move from tier 4 to tier 1. Tier 1 is directly to retailers, that is where you make the most money but also incur the biggest risks. Companies or retailers would be more comfortable if they are ranked tier 4 and then move up to tier 3. Tier 3 is for raw materials suppliers selling to manufacturers that are going into the assembly lines. It is more sustainable to see the improvement over the processes.

Audience comment: For a large-scale transaction that our company normally deal with, it takes at least 18 months to obtain and place the first purchase order (PO) on apparel with a brand new factory, while it takes about one year for a PO on foods (not for the completion of a full transaction). This supplier is not necessarily a brand new one for a global supply chain, they might have shipped or exports their products to other countries before. For a SME of 200 to 400 employees, tier 3 or tier 4 may be suitable.

A12 USAID Answer: Moving companies by tier or getting them more involved in global value chains is not necessarily the primary goal. The primary goal is to identify where the barriers are for the sectors we are working on, identify the solutions, and then replicate them in those sectors and elsewhere after the award is ended. Along the way we assume we will move the companies along the process, but it is not our primary goal; we want to engage in learning, evaluation and assessments.

Q13: Can you clarify what you mean by global value chains? You want us to link SMEs to foreign direct investors (FDI) and exporters, bringing SMEs to GVC. Many big GVC buyers are not manufacturers, rather they are retailers; whereas an FDI firm is a manufacturer actually producing in the country.

A13 USAID Answer: We assume that by linking foreign firms with Vietnamese SMEs that the SMEs will become part of the global value chain. We have amended the RFP.

Q14: Does a transaction mean we provide training services to companies, e.g., XYZ Services Inc. management leadership training? Is that considered a transaction by definition?

A14 USAID Answer: There are two questions here. There was a similar question in Hanoi. Can a firm count a transaction they do towards the transactions of the award?

We are going to examine this looking at appearances. From an optics perspective, we may be concerned that whoever is USAID’s prime contractor should be seen as a completely impartial party between the private sector parties, and not seen as benefiting one way or another. USAID has modified Section C of the RFP to reflect this.

The second question relates to whether we would consider the services as one of the targeted sectors? For any and all sectors, we are looking for compelling analysis and reasons why we should focus on these particular sectors, and what the impact would be.

Q15: Can you share with us some of the key learning or key questions that was brought out here from Hanoi?

A15 USAID Answer: Hanoi was more process oriented, rather than big idea, structural questions. Down here, you have given more input into how this RFP is structured and maybe changing it to make it stronger. We have more input and questions on process on how this will evolve. We are certainly getting a lot more questions about our assumptions and our approach. This part of the meeting has lasted at least twice as long as the Hanoi section.

Q16: On institutionalizing key reforms, we do not know what they are yet. I would like some clarification. You were talking about barriers and more traditional issues -taxation, customs, legal reforms, etc. During Phases I and II, we will be identifying barriers to transactions that are going to be getting one suppliers’ quality up to par, a certification to others. Barriers will be specific to transactions. That is not necessarily something you can institutionalize. I am confused if Phase 3 is addressing what we traditionally in development speak refer to as reforms, because in Phases I and II we have to address the transaction barriers in order to accomplish the transaction. So we will have already addressed the barriers in Phases 1 and 2.

A16 USAID Answer: You might be able to identify the barriers, but not address them during the first phases. So for example, one of the barriers, and you can overcome it, might be registration with a certain tax authority or standardization in a certain sector, for example construction regulations. When I think of that I think of you -- you can identify the barrier and maybe you can overcome it in terms of putting a lot of resources towards it. But that barrier is still a barrier. What can we do? You the partner will have identified an issue through the learning: what is it that we can potentially do from a concerted USG push through our partner to reduce that barrier for other companies?

Yes, barriers would be transaction-specific, however, we would expect there would be trends that emerge.

Q17/clarification: I think you are talking about challenges in the moment and that is not reflected in changes in the law. Advocacy for changes related to laws and amendments are institutional. Maybe you need more mechanics. So that is addressing the root cause of why an industry is stagnating, from technical institutional support to the government regulations that inhibit the growth of SMEs. Right?

A17 USAID Answer: We assume there are steps we can take sector wide, or even broader,that will enable the two sides to have more information to make these transactions happen. They may be more traditional enabling environment/policy-related, or these changes might be more action-oriented - e.g., using a standard a B2B database. As we have said, we do not know the answers now, and we anticipate that these opportunities will become apparent during the two phases of the award.

Q18: What is your involvement with the GVN on this project? How do you work together with the GVN?

A18 USAID Answer: As a bilateral donor, USAID has been engaging the government as much as possible during the design stages and up to now so that when our new activity is launched, GVN officials are aware of it and will approve it quickly. That is our goal. So we continue to meet with working level officials at this point to keep them updated on where we are in the process. We anticipate that the Ministry of Planning and Investment will provide the institutional home for this new activity. We expect the contractor will need to work further to receive project approval upon the award.

Q19: What is the timeline?

A19 USAID Answer: Our money needs to be obligated by September 30th. So at the very latest September 30th. Please see the RFP for the new submission date.

Q20: Will there be any changes to the RFP after today? Will it impact the deadline for submission?

A20 USAID answer: Yes. Please see the amended RFP.

Let’s take a 20 minute break. Please come back at 11:55. The next 20 minutes as an opportunity to network.

Section Cost Proposal

Award fee is to incentivize better performance.

The award fee plan is meant to incentivize you in your private sector engagement, or how well you engage with private sector, and how well you’re actually learning and monitoring your activities. This is not a traditional way to do things. It’s okay to fail. If you’re working in the sector and that transaction doesn’t work out, that’s fine. We want you to learn from that (why it did not) and apply to the next one. That is what is going to play well with the award fee.

It is a subjective evaluation. There is no way we can objectively make this work.

Otherwise we would do another contract type, called cost plus incentive fee. We’re trying to structure the award fee in a way to make it as objective as possible but we recognize it is subjective in nature. And you’re as the offerors are accepting that risk.

That’s a part of risk sharing range.

Please see the Award Fee plan. The FDO makes a unilateral letter of a determination of how much fee the contractor would be awarded for that award fee period.

The range of evaluation. Satisfactory is the range of the percentage of the award fee that you’re eligible for if you are rated as just meeting requirement, which is from 0 to 50 percent. You are not able to get more than 50 percent of the award fee for just getting satisfactory. That is why it is meant to incentivize better. To go from 51 to 75, you have to get “good”; “very good”- 76 to 90; “outstanding” 91-100. You’ll have to show what benefit you provide to us get more than satisfactory.

Q&A

Q21: Looking at the award criteria, is there any intent that the Board is also looking at the CPARS as additional criteria to make a recommendation to the FDO to decide?

A: Only the information in CPARS ties directly to the award fee criteria. I can see the case when CPARS says the contractor failed to actually learn from mistakes, for example, the AFB can take that and say clearly the contractor is not really doing a good job of learning.

We will expect that with the COR preparing the evaluation and also being the one to enter the stuff in CPARS it would be captured in COR evaluation.

A21 USAID Answer: The Board may look at the CPARS if the information in CPARS ties directly to the award fee criteria.

Q22: In Amendment 1 you eliminated the base fee. Why?

A: We do not feel it is appropriate here (for services). We want you to do better, we want you to excel here. If we just give you a base fee, we would still not move the ratios arrangement.

A22 USAID Answer: The base fee is not very appropriate for service. We also expect you to put effort into the activity and excel in performance.

Q23: (Consultant/Subcontract) Even consultants just provide TA support, are they considered a subcontract? They are not our employee.

A23 USAID Answer: Yes, consultants are considered either subcontracts or employees.

Q24: What do I need to get consent (if consultants are subcontracts)?

A: So if they’re fixed price /LOE fixed price contract with less than 150K, you don’t need to get consent.

A24 USAID Answer: If a subcontract for consultants is a fixed price contract with an amount of less than $150,000, you do not need to get the CO’s consent.

Q25: If you are doing a subcontract (for consultants), it was assuming that the fixed-price as assumed deliverables; is there any certain limitation recurring in fixed contracts?

A: It is up to your policy. For example, stuff happens. If you get Bob and Jane and you bring them on board and you said that they provide 100 days of level of effort (LOE) to work towards the statement of work. I would say LOE because you do not know whether that thing is a deliverable. The LOE is deliverables in itself. If you find that you need more that person’s LOE , just modify the fixed price award because the deliverables are still of their LOEs. How much it costs is still fixed at that time. A fixed price contract does not mean that it is set in stone. It just means that if the conditions do not change you only pay that price - you’ve got for how much it costs. When these conditions change, change it.

A25 USAID Answer: As long as the contractor is in compliance with the relevant clauses, then it is up to their internal policy.

Q26: I would like to know if consultants as individuals will not be subject to source selection, which is code 937, when doing procurement?

A: Yes, they are. Regulations with 22CFR 228 have an exception for individuals. It says it does not apply to individuals so long as they are not a citizen of a foreign policy restricted country.

With regard to the consultants, the regulations are quite clear. The cost principles that are applied to contracts state that professional consultant services are considered contractual, and the regulations require of me as a CO to make sure that, for example, the termination clause requires the government of adequate

A26 USAID Answer: 22 CFR 228 has an exception for individuals.

Q27: Regarding branding and marking terms in the context of Vietnam: is there any sensitivity about branding and marking, as I have read the USAID sites and wonder what if it is going to be a sustainable reform?

A: One of the secondary goals from Congress giving money to our programs here is to let people know this was coming from us to improve our relationship with people. That’s been recognized and we have exceptions available to us, for example, they would comprise with the goal and program. You just have to ask for those.

A27 USAID Answer: One of the secondary goals from Congress giving money to our programs here is to let people know this was coming from us to improve our relationship with the people. That has been recognized and we have exceptions available to us. For example, they would comprise with the goal and program.

Q28: There is an inconsistency regarding the baseline and gender assessment. The RFP says [in section 7] that we will use an assessment to produce the plan we submitted, and the questions in the Q&A indicated only for the 5 sectors we are working in.

A28 USAID Answer: We have amended the RFP to address the concern, please see Section F.

Q29: For the gender assessment, I see how it combines with the profile assessment but not with the initial work plan ... So I do not know if you are willing to separate it out so a gender assessment could be considered during your internal working and indicator development, and if you preferred that to wait under consideration until later in the process.

A29 USAID Answer: We anticipate gender indicator(s) will appear in the MEL plan and the baseline assessment.

Q30 : For the cost breakdown, should it be in the narratives or in a separate spreadsheet?

A30 USAID Answer: It is in the narratives section. There is no need for a separate spreadsheet as we are not looking for a breakdown of costs, except by the phases.

(Presentation from MC continued): We are looking, based on information we received from you today, we may revise the due date. You have raised a lot of good points and maybe we need to go back and review. But we also need to balance the hard requirement of getting award by September 30 or else we’ll lose the money we have appropriated for.

Q31: What is the stakes of the game for these SMEs as we go through this that would keep them in the game? It will be difficult for them. We noticed that when we provide training, if it is provided free of charge, the suppliers basically said “I will send them in to second class,” then people come and see what they learned. Sometimes it’s not even creating actions that we needed… But when we realized that you have to put the blood in with some kind of fee, everyone says that is great. Would you ever consider that these SMEs should pay to have their names in the game?

A: Sure, if it makes sense and for doing something better. It is not prohibited, it just offsets what the government pays for. How will we engage SME and keep them engage in the process - that would be something we are trying to learn, try to do, try to narrow and learn with wherever our partners ends up. Because there is probably not one great answer. It would depend on who the SME is.

A31 USAID Answer: How to engage the private sector is up to the contractor and we consider this part of learning.

Audience comment: The difference is if they do not show up, they do not have to pay anything.

USAID comment: if you go back to private sector engagement, one of the subfactors is we ask for value proposition of private sector engagement. What are you going to use to go out to private sector, to get them engaged and keep them engaged?

Q32: About technical evaluation criteria, there are three factors of equal weight, with key personnel less than that but still important. How are they evaluated?

A32 USAID Answer: A simple example would be when we have Offer A, which has Factor 1-very good, Factor 2-very good, Factor 3-very good, Factor 4 (key personnel)-satisfactory; Offer B has: Factor 1-very good, Factor 2-very good, Factor 3-satisfactory;

Factor 4 (key personnel)-outstanding. If we had that, we would go with Offer A.

However, it is not always that simple in reality. For a source selection decision, we will have to take into consideration all the information we have.

Q33: Is there any kick-out point/line (in the evaluation process)?

A33 USAID Answer: There is no kick-out point in the process. Per the RFP, if a technical proposal is not deemed acceptable technically, USAID does not have to review their cost proposal.

Q34: For the technical implementation plan Phase 1: when you come back and if there is any direction changes, or assumptions of SME changes or FDI changes, would it be converted in section L?

A: the information of what should go into Phase 1 implementation plan in section L is at high level, to give you flexibility to determine what phase 1 implementation plan should look like in order to meet the requirements of Phase 1 in section C for the sectors that you’ve identified you want to work in. So, if there is a change that happens in section C that we think it needs to be reflected in section L, we would definitely do it.

A34 USAID Answer: Please see the revised RFP.