MGA
An MGA (Master Government Aggregator) is an intermediary that consolidates procurement across multiple government buyers to negotiate better pricing and streamline purchasing.
What Is an MGA?
A Master Government Aggregator (MGA) is an intermediary that consolidates procurement across multiple government buyers to negotiate better pricing, simplify purchasing logistics, and provide vendors with a single channel to reach thousands of SLED agencies.
MGAs like Carahsoft, SHI, and CDWG are some of the largest players in government technology sales. They hold contract vehicles, manage procurement compliance, and provide logistics and fulfillment services that make it easier for agencies to buy and for vendors to sell.
How MGAs Work
- Vendor partners with the MGA. The vendor signs a reseller or distribution agreement giving the MGA rights to sell their product to government.
- MGA holds contract vehicles. MGAs maintain cooperative contracts, state contracts, and GSA Schedules that agencies can purchase through.
- Agency orders through the MGA. The procurement officer places an order with the MGA referencing the appropriate contract vehicle.
- MGA handles procurement and logistics. Invoicing, compliance documentation, delivery, and payment processing are managed by the MGA.
Major MGAs in SLED
| MGA | Specialization | Key Strengths |
|---|---|---|
| Carahsoft | IT, cybersecurity, cloud | Largest government IT distributor, deep vendor portfolio |
| SHI | IT hardware, software, services | Broad product catalog, strong state contract coverage |
| CDWG | IT hardware, cloud, managed services | Strong K-12 and higher ed relationships |
| Insight | IT solutions, cloud services | Integration and managed services capabilities |
MGA vs. VAR
| Factor | MGA | VAR |
|---|---|---|
| Primary role | Procurement logistics and contract access | Implementation, integration, and support |
| Value add | Volume pricing, compliance, broad reach | Technical services, training, customization |
| Relationship depth | Transactional to strategic | Deep, service-oriented |
| Best for | Products that sell at volume | Products requiring implementation |
When to Use an MGA
- Entering the SLED market. MGAs provide immediate access to contract vehicles and agency relationships. They are the fastest path to first government sales.
- Scaling nationally. MGAs have reach across all 50 states. For vendors without a national direct sales team, MGAs fill the coverage gap.
- Products that sell at volume. If your product is relatively straightforward (SaaS, hardware, standard services), MGAs can efficiently process high volumes of government orders.
Frequently Asked Questions
What is an MGA?
An MGA (Master Government Aggregator) is an intermediary that consolidates procurement across government buyers, holds contract vehicles, and provides logistics and compliance services to simplify government purchasing.
Who are the biggest MGAs?
The largest MGAs in government IT include Carahsoft, SHI, CDWG, and Insight. They hold extensive contract vehicle portfolios and serve thousands of SLED agencies.
How is an MGA different from a VAR?
MGAs focus on procurement logistics, contract access, and volume pricing. VARs add technical services like implementation, integration, and support. MGAs are transactional; VARs are service-oriented.
Do vendors need to work with an MGA?
Not required, but highly recommended for entering SLED. MGAs provide immediate contract vehicle access and agency reach. They are the fastest path to first government sales for new entrants.
What margin do MGAs take?
MGA margins vary by product type and volume, typically 10-25%. For high-volume products, margins may be lower. MGAs negotiate based on expected sales volume and vendor support level.