How Do You Price A Government Contract
There are various ways you can price a government contract however, your price might not be guaranteed by a contracting officer if you did not thoroughly research and prepare for it. You can dive deep into the above-mentioned websites, looking for how often quality won out over price or vice versa and paying close attention to the details.
Even though the price is slightly more than other bidders, certain federal contracting officer regularly awards prime contractors with the best solution. Other contracting officers choose to find small business contractors that offer the lowest price while still being technically appropriate. Here are more reminders on pricing a government contract.
- Bid aggressively if you want your first federal contract. But keep in mind that your first federal contract might not bring in a lot of cash. Nonetheless, you will earn valuable past performance and experience, as well as contacts with procurement officer/s who will remember you for future, more large deals.
- Consider basing your price on the prize from the previous year.
- Increase your bids as you gain more previous experience.
- Read the full bid a second time. You cant afford to overlook anything or fail to follow instructions precisely.
- Double-check your bid with a friend or colleague. Check for spelling mistakes and double-check that youve answered all of the questions and submitted all of the needed information.
- Make use of your bid template to save time in the long term.
Indefinite Delivery Indefinite Quality Contract
For government agencies to function, they require staffing and supplies that should be procured in bulk. So for long-term and government-wide purchases, the government awards IDIQ contracts. One of the most famous examples of this type of contract is the GSA Schedule contract.
Read more about these federal contracts here.
Is Government Contracting Easy
It is most definitely not. The government contracting industry is riddled with complicated processes that deter many from venturing into it. However, given the circumstances, there are certain exceptions and considerations given to federal contracting firms, especially to disadvantaged small businesses. So although government contracting is certainly not easy, there are policies and programs to ensure that everyone has a fighting chance of winning a government contract.
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Ask For Help At Your Local Ptac
Procurement Technical Assistance Centers or PTACs provide varied assistance in government contracting, all for free. There you can find out if your business meets the criteria to work with the government. You can get help certifying your business as 8, WOSB or HUBZone. And sure enough a PTAC can help you identifying bid opportunities that your company is eligible to bid.
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What Are Unallowable Costs
Expenses acquired by the contractor that do not meet the authorized criteria under the current contract terms in FAR 31 are identified as unallowable by the government and excluded from any billing, claim, or proposal applicable to the contract.
Some common examples of unallowable costs include but are not limited to:
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Talk To A Pcr And Get Listed
Youll need to speak with a procurement center representative for the government agency you wish to work with. This person serves as a liaison between you and the federal government, making sure you have all the info you need to bid.
Each agency will also have their own specific bid boards on their procurement websites.
After youve learned all the bidding requirements to win government contracts, get yourself listed in the System for Award Management . This database functions like LinkedIn for government contracts.
Update your business info quarterly to keep the government aware of what youre doing and offering. The more accurate this listing is, the better a chance you have to win a lucrative contract from the government.
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Flexibility In Change From One Individual Government Point Person To His/her Successor
Contractors often are required to build a system that meets the requirements that a particular individual in government authority believes is appropriate to the contractor, only to have that government authority replaced by another person whose ideas about requirements differ from his/her predecessor.
The successful government contractor systematizes its accounting operations, as the company grows, in order to maintain and improve compliance. The backup position businesses should constantly maintain, if it is financially possible to do so, is one of readiness for transition, in order to seamlessly maintain the integrity of its system if/when essential people leave the company or become unable to fulfill their roles.
For additional information on setting up DCAA compliant accounting systems, and in clearly understanding the suitability of various technologies in order to avoid unnecessary and excessively costly or insufficient accounting platforms for government contracting, contact us below.
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Using Available Information To Manage And To Achieve Growth
The process of implementing a system for accounting to the federal government, designing special procedures, and implementing regulatory compliance policies naturally generates a wealth of useful information available to the new contractor. However, this cache of information has little value if the contractor does not recognize the benefits of leveraging the information acquired into understanding of governmental purposes, needs, and larger processes, and then use that knowledge to best manage and methodically grow the company.
For just one example, compliance with government requirements necessitates correct calculation of an overhead rate. However, if the contractorâs management does not recognize the importance of learning why the rate is significant, and does not control spending to manage rate variance, then there is not much use for the company in its mere awareness of the overhead rate and of the fact that conformance relies upon its correct calculation.
Todayâs technological innovations afford contractors a much better capacity for compliance with government requirements, permitting employment of systems for management and growth, while adapting to keep in step with ever-incoming changes in requirements.
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Study The Federal Acquisition Regulation Or Far
The Federal Acquisition Regulation is the principal set of rules and policies governing every federal agencies procurement transaction.
The taxpayers money funds the budget used by the government for its federal contracts. And that is why federal agencies and government contractors should strictly adhere to the rules and policies indicated in FAR. Take your time to read it thoroughly because this will also serve as your guide in handling federal government contracts.
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Free Guide To Getting Started In Government Contracting
In this blog post, we took a general overview of how you can get the best possible start in government contracting.
However, if you want to take it a step further, and get a more detailed, step-by-step guide for getting started, we have a FREE guide for you.
Most government contracting guides will give you just the basics such as filling out the paperwork and submitting bids.
USFCR’s Practical Guide to Getting Started in Government Contracting covers the basics but also gives you actionable strategies for building a new and reliable source of revenue.
Originally published Apr 23, 2021 10:35:04 AM, updated August 23, 2022
Winning Government Contracts: Five Things You Need To Know
Uncle Sam spends billions of dollars every year. How to position your company to win government contracts.
The U.S. government is the biggest consumer of products and services in the world. And some $500 billion of Uncle Sam’s ever-expanding budget goes to small businesses, resulting in huge opportunities for those that know how to navigate the waters of government contracts.
However, many small-business owners have no clue about how to get involved with government contracts. Lourdes Martin-Rosa, American Express OPEN’s adviser on government contracting and a federal contracting expert for nearly two decades, mentors entrepreneurs who are looking for profitable relationships with the government. She says many miss out on potential government contract revenue because they don’t know how the business of government works. “A government agency works similarly to a corporation and has different purchasing methods,” Martin-Rosa says. “Some agencies prefer to break up a contract and award it more quickly, while some prefer to bundle all services into one and award the big prize to one small business that can then subcontract it out to partners.” Martin-Rosa believes the key to success in obtaining government contracts is to research how the different government agencies operate and see how your unique services can be instrumental.
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How Can Tech Get Started With Government Contracting
A good place to start is the Small Business Administration. The SBA has helpful guides with information on how to become a federal contractor, including a government contracting 101 workbook. These resources are a good starting point almost a government contracting for dummies if you will.
To dig a little deeper, learn about opportunities that are relevant for your tech. While many program offices are thinking outside the box and traditional communication methods, understanding how federal agencies are conducting market research is important, and meet them where they are looking for you. You can discover existing contract awards on GovTribe and compare your capabilities with other companies, or find prime contractors that have relevant needs.
Beta.sam.gov is the official site for managing federal awards, so use that to look for relevant open opportunities. There are also an increasing number of government innovation hubs in places like San Francisco and Austin that are designed to bridge the gap between commercial tech and the agencies. Government innovation shops can provide insight into the government contracting process, and introduce you to a community of innovative government leaders.
Learn about the government
The procurement process has a lot of different paths, and you need to familiarize yourself enough to know how to steer the process so you have the best chance of getting on a federal contract.
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How To Win Government Contracts Without Having To Write Complex Proposals
You want to learn how to expand your business with government contracting?
Government Contractors Association is here to help you NAVIGATE THE GOVERNMENT CONTRACTING MAZE and Learn How to Ã¢WIN GOVERNMENT CONTRACTSÃ¢ NOW WITHOUT spending 3 years spinning your wheels!
What is significant about April 19th, 1775?Ã¢The Shot heard around the world?âSecret Meeting at Lexington, Mass?
NO Government Contracting Started! George Washington did not have the money to purchase equipment, food, clothing and finances for the Continental Army, so he was able to acquire or procure what was needed through a written contract from a new congress or at the time a simple group who backed him and his efforts to build our country. The Federal & State Governments use a Contract as the binding agreement with a vendor to provide products and services to the government in exchange for payment for those goods later.
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The Governments Cost Accounting Rules Can Apply To Government Contractors Of All Shapes And Sizes In Every Industry While Anyone Can Read These Rules We Help You Understand Why They Exist How To Interpret Them And How The Government Enforces Them Having Access To This Deeper Level Of Understanding Helps Our Clients Reduce Risk Improve Compliance Effectiveness And Improve Accounting Simplicity Effective Cost Accounting Doesnt Necessarily Require Tedious Complexity
The governments cost accounting rules govern what costs the government will or wont pay , and how much of those costs theyre willing to pay . Political and socio-economic policy frequently underpin the cost allowability rules. This means unallowable costs represent items or activities that the government, as a steward of public funds, wont pay regardless of whether or not the item is a routine business expense. While the government will pay for allowable costs, it will only pay its fair share as determined by its cost allocability rules.
Both of these concepts are important when either negotiating non-competitive contract prices or performing cost-reimbursable contracts. Explore the sections below to learn more about how we help clients distill the rules and keep it simple:
- Cost allowability
Dive Into Your Indirect Cost Details
Were not telling you to adjust your direct labor rates, fees, or fringe rates. What were suggesting is taking a hard look at your indirect rates and look for ways to trim costs. Pay close attention to your overhead as well as general and administrative costs. You can often find opportunities to reduce costs. Here are some common expenses worth reviewing:
- Computer hardware and software services moving selected computing services to the cloud can reduce in-house costs and improve security, while using a basis of estimate software can increase your employeesâ efficiency.
- Office supplies and related office equipment that is no longer necessary.
- Facility maintenance and rent.
5. Reverse-engineer the competition.
Study similar awarded contracts with public financial information to gauge direct labor rates, average rate per hour, burdened labor rates, and total contract value. Do your homework on the U.S. General Services Administration and other respected sources for rate schedules, labor categories, and burdened labor rates in your area. Compare your findings to salary surveys and calculate the burdens for different labor categories to help you figure out competitor wrap rates and bidding strategies.
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Create An Outline For Your Government Contract Proposal
The secret in crafting an effective contract proposal is thorough and strategic planning. Once you have done all the preparations from the earlier points, you should lay down a contract outline.
Having a proposal layout before writing down your contract bid will ensure that your document will not veer away from your main message and contract goals. Additionally, this will lessen the risk of overlooking important information youll otherwise miss if you just blindly ventured into writing your contract bid.
To help you craft your outline, look again at the sections of the RFP sent to you, then try to address them one by one. After you have laid out all the points, you can start to write your proposal.
Small Business Preference In Federal Contracting
Under the Small Businesses Administration , the federal government has enacted several programs to help small businesses break into the federal contracting market. The SBA has created several programs that create a preference for businesses meeting specific eligibility criteria either based on ownership of disadvantaged people or geography. These programs are designed for set-aside contracts that do not go through the competitive contracting process. Rather, these contracts are sole-source contracts designed to fill specific federal government needs. Specifically, small contracts ranging between $3,500 and $150,000 are set aside for certain small businesses.
The SBAs 8 preference category seeks to assist small businesses owned by socially and economically disadvantaged individuals successfully bid for federal contracts. To be eligible for 8 preference, the small business must be owned by a socially and economically disadvantaged individual. Proof of disadvantage is required for eligibility and the business owners must demonstrate good character and potential for success.
The HUBZone preference category helps small businesses located in economically disadvantaged regions mapped by the SBA. The HUBZone Maps can be found on the SBAs website. While many of the HUBZone regions are economically depressed rural areas, some economically depressed urban areas are also included.
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Gsa Contracts For Dummies
This article will provide a comprehensive GSA guide: Here are GSA Contracts for Dummies.
President Harry S. Truman founded the GSA in 1949 to streamline federal procurement and administrative operations. The GSA has evolved significantly since the late 1940s and is currently Americas sole supplier for federal products and services.
The General Services Administration manages federal procurement, relieving other federal agencies of administrative duties. Bought by the federal, state, and municipal governments at pre-negotiated prices, GSA awards long-term governmentwide contracts to businesses hoping to make it big in the government space.
Dynamic Small Business Search
Also managed by the Small Business Administration, the Dynamic Small Business Search is an online search tool primarily used by government agencies to find small business contractors for contract opportunities. Additionally, small businesses can also use this tool to look up other small businesses to work with on a project.
But before you get your small business listed at DSBS, you have to register at the System for Award Management website for free first. Here are the requirements to sign up at SAM and other important things you need to know as a federal contractor.
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Get Started With Government Contracting 101
The federal government represents a massive market opportunity for commercial tech companies. But many arent sure how to get started and are left asking themselves how to become a government contractor.
The government has a lot of money to spend on tech the federal government spends about $500 billion in contracts every year and though the procurement process is notoriously lengthy and complex, the payoff can be long, stable, reliable revenue that makes government contracting a worthwhile endeavor.
How Does The Contract System Work
GeneralServices Administration is responsible for supplying federal agencieswith goods and services they need. The range of such goods and service is notall-encompassing, but still is wide enough to cover the majority of spheres andindustries. Basically, the government needs almost everything.
The vehicleto purchase goods and services for the federal agencies needs is calledSchedules. A schedule award opens up contracting opportunities for a business.Bidding for such opportunities and winning the bid effectively signs thecontract between that business and the government.
And learning how to bid is a significant part of your success in doing business with the largest customer in the world.
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