MANUGISTICS

Summary

The General Services Administration signed a deal that it said could
save the government \$25 million on supply chain management software.\
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Manugistics Group Inc. of Rockville, Md., became the second vendor to
join SmartBuy, the government's enterprise software licensing program.\
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For the second deal, Manugistics agreed to a three-tier discount for
agencies buying from its Federal Supply Service schedule.

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The first discount is 25 percent, the second an additional 15 percent
and the third ranges from an additional 2 percent to 7 percent.\
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Purchase of a single software module would qualify for the 25 percent
discount. Purchase of a bundle of modules would rack up the additional
15 percent discount, for total savings of 40 percent, said Jeff Holmes,
executive vice president and president of Manugistics' government
aerospace and defense unit.\
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The third discount rewards agencies for cumulative government purchases.
For example, an additional \$20 million in purchases would qualify for
another 3 percent discount, Holmes said. Existing federal customers that
have passed the appropriate buying threshold will receive an added
value---yet to be determined---that is equal to the 3 percent discount,
he said.\
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The company reports sales of about \$50 million in software to the
government since 2000. Its six federal customers include the Air Force,
Marine Corps and Navy.\
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Most of Manugistics' software is sold through other companies.
Manugistics officials wanted the company to become a direct seller and
saw that offering the steep discounts would help the company achieve
that goal.\
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Details

Modification on GSA Part 70 Schedule

Product Discounts:

25% discount off GSA contract for orders exceeding the Maximum Order
Limitation for SIN 132-33, Perpetual Software Licenses and SIN 132-34,
Maintenance

55% discount off Suite User Price for 1-500 users

65% discount off Suite User Price for 500-1,000 users

CUMULATIVE PURCHASE DISCOUNT -- ENTERPRISE WIDE

Incremental discounts on software licenses based on cumulative purchases
across the Federal Government. Dollars counting toward the cumulative
purchase discount levels include software license fees only. These
discounts are incremental to the discounts included in Product
Discounts, above, excluding the Suite User Pricing, and bundled
configurations below. The cumulative purchase discount levels are as
follows:

Category Cumulative Software Purchases Discount

1 \$ 0 - \$ 49,999,999 2%

2 \$ 50,000,000 - \$ 74,999,999 3%

3 \$ 75,000,000 - \$ 99,999,999 4%

4 \$100,000,000 - \$124,999,999 5%

5 \$125,000,000 - \$149,999,999 6%

6 \$150,000,000 - 7%

MAINTENANCE (SOLUTION SUPPORT) PRICING

+--------------------+---------------+---------------+----------------+
|                    | SIN: 132-34   | SIN: 132-34   | SIN: 132-34    |
|                    |               |               |                |
|                    | CLIN: 001     | CLIN: 002     | CLIN: 003      |
+--------------------+---------------+---------------+----------------+
| Purchase Price of  | *Standard     | *Premium      | *Signature     |
|                    | Solution*     | Solution      | Solution       |
| Software           |               | Support Plan* | Support Plan*  |
| License(s)         | *Support      |               |                |
|                    | Plan*         |               |                |
+--------------------+---------------+---------------+----------------+
| \$ 0 -- 999,999    | 18%           | 21%           | 24%            |
+--------------------+---------------+---------------+----------------+
| \$ 1,000,000 --    | 15%           | 18%           | 21%            |
| 1,999,999          |               |               |                |
+--------------------+---------------+---------------+----------------+
| \$ 2,000,000 --    | 12%           | 15%           | 18%            |
| 4,999,999          |               |               |                |
+--------------------+---------------+---------------+----------------+
| \$ 5,000,000 and   | 9%            | 12%           | 15%            |
| up                 |               |               |                |
+--------------------+---------------+---------------+----------------+

Projected Savings:

[Reduces costs by up to 19% from existing discount structure and
approximately \$1,000,000 in annual savings.]{.mark}

Bundled Configurations:

Bundle A - Materials Planning and Distribution Management

Description:

Suite of forecasting algorithms that drive demand plans based on
historical usage which are then matched against replenishment plans to
correctly place inventory ahead of actual demand.

Netowrk design and demand flow analysis that help supply chain decision
makers determine facility placement and product sourcing and
distribution in a constrained environment (budget, lead-times,
resources, transportation, etc.)

Pricing:

Additional 15% discount

Included software modules:

Include but not limited to:

Networks Demand

Fulfillment

Master Planning

Collaborate

Monitor

Visibility

Delivery Management

Reporting

Analytics

Transport

Software modules may be substituted during time of configuration based
on specific client solution.

Bundle B - Materials Planning, Distribution Management and Spares
Planning

Description:

the Manugistics Materials Planning and Distribution Management solution
portfolio is extended to include forecasting. Includes complex
mathematical algorithms that are used to incorporate external factors
such as usage data, engineering data and failure rates to forecast
demand for slow movers. Additional capabilities include Repair vs. Buy
logic, shop floor scheduling and statistical analysis for failure data,
lead times, etc.

Pricing:

Additional 15% discount

Included software modules:

Include but not limited to:

Those contained in the Materials Planning and Distribution Management
and Stat Graphics

Production Scheduling

Sequencing

Supply

Software modules may be substituted during time of configuration based
on specific client solution.

Bundle C - Global Transportation Management

Description:

Allows for simultaneous planning and optimization of both inbound and
outbound transportation loads, i.e., scheduling of purchase orders from
suppliers and delivery orders to customers to maximize utilization of
vehicles. Contains intelligent engines that automatically evaluate
complex criteria for determiniong the best shipping option considering
factors such as historical performance, value of the shipment,
criticality to the mission and transport costs.

Pricing:

Additional 15% discount

Included software modules:

Include but not limited to:

Networks Transport

Freight Pay

Carrier

Order Management

Delivery Management

Software modules may be substituted during time of configuration based
on specific solution.

Bundle D - Maintenance Repair and Overhaul

Description:

Comprehensive operational management software for organizations that
repair, overhaul, maintain, upgrade or modify complex equipment.
Includes capabilities required for asset tracking, induction and
disposition, repair replace and rebuild management, resource planning
and financial management.

Pricing:

Additional 15% discount

Included software modules:

Include but not limited to:

Networks MTO

MRO

Supply

Collaborate

Reporting

Analytics

Production Scheduling

Sequencing

Software modules may be substituted during time of configuration based
on specific solution.

Bundle E - Configurable Solution Bundle and Advanced Concept
Demonstration Technology Pricing

Description:

Any bundle of five or more modules from the list provided all modules
are licensed at the same time.

Pricing:

Additional 15% discount

Included software modules:

Any five or more

[Savings Approximately \$3,500,000 in annual savings for existing
customers (assuming a 10% adoption rate).]{.mark}

Projected Savings:

[Reduces costs by up to 19% from existing discount structure and
approximately \$1,000,000 in annual savings.]{.mark}

[]{.mark}

[Five Year Projected Savings Overall: \$25M]{.mark}

**The Manugistics Inc FSS Contract number is GS-35F-0388K,** and the
Government POC for Manugistics is Stephen F. Bell, 703-306-7595.