Proposal Writing & Bidding on Government Contracts
Avoid Mistakes in Government Contract Bid Proposals
It is no secret that government contracting is a lucrative business venture. Given the current state of the economy, many small and medium sized businesses are now moving to federal contracts to get increased revenues. The commercial economy is definitely a tough market. Therefore, the ability to survive dramatically increases daily.
As more contractors turn to bidding on government contracts, they not only find a series of complex rules and regulations, but they also find that it is totally different than commercial bidding. Business lack the know-how and internal experience for effective proposal writing. As a result, they simply take chances in hope of landing more projects. What is the result? Very few awards.
When bidding on government contracts,RFPs and solicitations, you must first know the ground rules to play the game. Anything else is gambling and guess work. Unlike the commercial sector, the government procurement process creates virtually different challenges. So what really is different? Why are businesses moving to the government market place if bidding is just as difficult?
The following points are indisputable:
- The federal government (DOD) is the largest customer of commercial supplies and services.
- Bidding on government contracts can potential guaranty you income for at least one year (many bid awards are generally for 1 base year and 3 option years).
- Registration and qualification standards to do business with the government are very easy
- State contract awards oftentimes are lower in amounts than federal contracts
- Small business programs in the federal market are taken more seriously that state contracting
The difference between government and commercial proposals is substantial
For example:
- Federal procurement is governed and regulated by regulations and statutes
- A contractor does have some legal recourse in federal contracting as compared to the commercial sector
- Subcontractors in government contracting have more of a right to subcontracting opportunities than in the commercial and state sectors
Are attorneys necessary in federal contracting?
This depends on your idea of smart business. As mentioned before, federal contracting, although very lucrative, is regulated by a myriad of regulations. When bidding on government contracts, you must be familiar with all of the FAR clauses and complex regulations that bind you. Even if you are fortunate to land a government contract, the risk of noncompliance is high. The consequences are also stiff.
When bids are award, the contract also contains numerous clauses for which you have the obligation to know and comply. Most successful federal contractors have government contract attorneys either on staff or on retainer. This can be a wise decision when certain issues arise.
For example:
- Bid protests
- Allegations of fraud
- Ethical matters
- Contract termination
- 8a or HUBZone matters
- Teaming agreements or Joint venture matters
The penalty for failure on a government project can immensely cripple your business. The decision whether or not to retain outside attorneys or not is simply a decision that you must make.
How to Position Yourself to Take on Larger Government Contract Proposals
Many contractors across the country grapple with this question. There are concerns about bundling which the SBA is supposed to be monitoring. Small businesses should seriously assess their strength and capabilities when bidding on government proposals. To simply hope that the agency does not recognize weak technical capability and lack of resources is simply realistic. When contracts are too large for one business to handle, the best approach to bidding on proposals include:
- Consider entering into a teaming agreement with a reputable firm
- Joint Ventures
- Subcontracting to a larger firm that has the requisite past performance
- At last resort, seek the larger contract awards and pursue subcontracting opportunities
Our staff of government contract lawyers is frequently called upon to draft teaming agreements for businesses that are looking to join forces for the larger projects. There are some very important rules that will apply to such teaming arrangements and joint ventures.
These include:
- If you are a small business, ensure that you are performing at least 51% of labor costs (there are some exceptions to this rule depending upon you NAICs code)
- Ensure that the awardee (8a, HUBZone or Service Disabled Veteran Owned Business) does the critical parts of the project
- Do not rely on a large subcontractor’s employees
- The smaller prime must have overall responsibility for the project
- The small business (prime) must demonstrate that it has marketed and pursued the contract
When you are bidding on government contracts, you must be familiar with the various teaming rules. Failure to abide by these basic regulations can cost you the bid award in a protest to the SBA.
Mistakes in Proposal Writing & Bidding Process
When contractors bid on government proposals, they often scan the solicitation and statement of work to quickly decide that “we can do this work.” In addition to reaching this conclusion, they should also seriously question HOW they will do it. The agency will certainly assess it.
When the RFP is announced on FBO you must read entire solicitation very carefully. The agencies are generally very specific about that they want to see in your bid. Many federal contractors also know that you must provide exactly what the government wants in the solicitation.
This is true. However, successful competitors know that you must just do more than the minimum to prevail in the award. Bidding with the bare bones of the solicitation may only get you into the competitive range (final pick for consideration).
Notice that the competitive range has the keyword “competitive” in the phrase! This is a mistake that ‘flies’ over most bidders for a government contract.
- You must add competition and value when bidding on government contracts
- Do not be afraid to use commercial past performance in your response
- Don’t forget to also add the past performance of you subcontractors
- Focus on beating your competitor by adding value to the solicitation requirements
As government contract consultants, we rarely just write an RFP that merely includes the bare bones requirements because the probability of you winning the contract is greatly minimized.
The bottom line is that you must faithfully read the RFP, think about how you can compete against your competitor and add value for the government. For additional help, contact our office at 720.941.7200
Tags: bidding, government contracts
