Supply chain issues are plaguing the information communications technology industry, resulting in limited access to components and lead times at an all-time high that are hampering the ability for companies and service providers to bring services on-line quickly and efficiently. And now federal regulations to help support U.S. manufacturing and strengthen the economy are expanding, calling for even more federally-procured components to be made or transformed in the U.S.
To successfully keep up with digital transformation and grow your business in the federal space, it’s more important than ever to consider where you’re getting your network components.
Doing Your Part Cuts Cost and Lead Times
The ICT supply chain is a complex, globally interconnected ecosystem that has been severely impacted by the global pandemic—a situation that has conversely highlighted the importance of connectivity more than any other time in the history of the internet. Material scarcity, increasing freight prices, port congestion, and other supply chain issues are making it increasingly difficult to get the network components you need when you need them. While supply chain issues are expected to subside over the next 18 months, technology doesn’t wait that long. Business- and mission-critical application requirements are increasing now, and network and data centers need to respond by quickly adding, reconfiguring, and refreshing equipment and infrastructure. If you’re dealing with lead times of six months or more just to get the network equipment and connectivity you need for your data center, you’re not alone.
While overseas suppliers may have once seemed like a cheaper option, that justification has become increasingly difficult as many vendors struggle to satisfy your needs. It’s time to alter your buying practices and join the hundreds of organizations partnering with suppliers closer to home. Procuring “Made in the USA” components not only reduces lead times and saves you money on logistics costs; it also means you’re doing your part in creating more jobs to boost the economy here at home, helping to reduce environmental impact by cutting down on international shipping, and getting an overall higher standard of safety, quality, and service.
Acts of Good Required in the Federal Space
While buying American is the right thing to do, you may have no choice but to look to U.S. suppliers. The Buy American Act (BAA) and Trade Agreements Act (TAA) that have long established preference for goods manufactured in the U.S. and prohibited procurement from countries that have not entered into a U.S. trade agreement applies to all federal government agency purchases of goods. While these acts have helped increase procurement of ICT components manufactured in the U.S., there have historically been plenty of loopholes and exemptions, as well as limited reporting and accountability. But that may be changing.
In late July, President Biden signed Executive Order 14005, a whole-of-government initiative to strengthen the use of federal procurement to support American manufacturing. This order strengths the BAA and TAA by increasing scrutinization to reduce waivers, closing loopholes in the current regulation, applying enhanced price preferences, and increasing transparency and accountability. For example, the BAA has historically allowed products to qualify if just 55% of the value of their components were manufactured in the U.S., but with the new regulations, that threshold has been increased to 60% with a phased increase to 75%.
Under the law, anyone involved with GSA Schedules or federal contracts needs to comply with the BAA or TAA. Essentially, a product is compliant if manufactured or “substantially transformed” in the United States or manufactured in a TAA-designated country. While the concept of substantial transformation has been a bit vague, U.S. Custom and Border Protection (CBP) has already ruled on several networking products—Ethernet switches assembled in Malaysia and then downloaded with U.S. software were not considered “substantially transformed” per one CBP ruling. Buyers should beware that CBP rulings are expected to increase with increased scrutinization.
The good news is that CablesPlus USA’s HD8² ultra-high-density fiber patching system and many of the other top-quality fiber optic and networking products you rely on us for are made in the U.S.A. or have already been verified as TAA-compliant, including bulk fiber cable, cable production solutions, racks, enclosures, accessories, and more!
So whether you’re looking to reduce lead times and cost, do your part in boosting the U.S. economy, or comply with regulations for your GSA contracts, turn to CablesPlus USA. Because Made in the U.S.A. just makes sense. If you'd like to talk through your specific application or for guidance, we can do that too! just contact us at firstname.lastname@example.org or 866-678-5852