Archive for March 2013

Contracts for Essential Services, Cost Reduction and Constituency Services will grow in the Stingy Federal Market

The stingy and much maligned federal market is still well over $ 500 billion annually. The core functions of government still need to happen, although probably slower than before the tightening of the purse strings.

Layoffs and furloughs of federal employees will soon the happening. Who will they turn to perform what’s needed to keep the government operating. Service contracts because service levels can be adjusted with the stroke of a pen.

And how will they buy the required services with an already overburdened contracting staff? With multiple award contracts know as “IDIQ contracts”.

In an IDIQ contract a number of contractors are pre-qualified based on experience and prices and awaked large, five-year umbrella contract without any funding of work. Services are ordered and funded through task orders as the need arises during the five-year period.

Theoretically, the competition for an individual task order (funded work) is limited to the winners of the IDIQ contract (awardees). In practice, the real number of competitors for a task order is usually considerably less than the total number of awardees.

And what will they do when they don’t have enough contracting staff to write, publish, evaluate, IDIQ contracts? Award IDIQ contracts for acquisition services. In other words, hire contractors to assist in awarding contracts. A well-kept secret in federal contracting is that around one billion dollars a year are spent on acquisition contracts.

And what will be the upcoming IDIQ contacts for services?

1. Government-wide Acquisition Contracts (known as GWACs) for information technology services an products

2. GSA Schedules for professional and operating support services GSA schedules are GWACs.

3. Agency specific IDIQ contracts for professional, information technology, engineering, and technical services

4. Construction and facility maintenance IDIQs let by facility construction and service agencies like the Corp of Engineers

And what will be the hot service areas for the next several years?

• Funds recovery
• Health program services
• Productivity improvement services
• Transaction processing
• Constituency Services

Even congress knows that transactions still need to be processed, constituency checks still must be written. Government services still have to be provided even though they may be slowed down for political purposes.

Most “Real” Federal Contracting Opportunities Come From Relationships

Business Development in federal contracting usually means a combination of marketing (web site, brochures, white papers, etc.) and opportunity identification.
In many companies opportunity identification is exclusively research based without a relationship element.

Research for opportunities usually includes agency web site research, procurement forecast analysis, purchase of commercial opportunity databases, etc. While these opportunity sources are valuable they often end up with the need for frustrating and expensive cold calls.

The best source of opportunities is people who have relationships of any kind with potential federal buyers. This type of opportunity identification is inherently more complex than research and is difficult to manage and control as a standard business process. A relationhip-based process could include the following sources of leads.

1. Contract employees working on site at a federal facility. The advantages of this source are obvious. The employees can form strong bonds with the people they work with every day. The downside is that they may think selling is not ethical or do not have the type of personality that recognize opportunities.

“Selling as you work” is not unethical and is a valuable process for successful federal service contractors. You get paid to sell and the federal government understands that this type of sales is inherent to contacting is done off the clock.

2. Your subcontractors, business partners, team members, etc. can be valuable opportunity sources as long as the relationship is mutually beneficial.

3. Your employees can have federal friends and acquaintances that you are unaware of but could be helpful for referrals and introductions.

4. Company management may have friends and/or business relationships that can be of assistance in developing business.

The problem with the use of people relationships to grow more relationships is that someone has to make “asking for the lead” a more formal process than it is in most companies.

Sell It Then Worry About Capturing It

“Capture Planning” in the federal market usually involves opportunity identification, plan of how to “capture” the opportunity, and write the proposal in response to the solicitation.

Some federal contracting companies are finding that the capture planning process is not as effective as hoped. Most, often the company lacks a company-to-customer sales process.

Selling is hard. Most technical staff members and subject matter specialists are good at performing contract tasks. But few are good at selling a customer and at the same time appearing like they are not selling, but solving the customer’s problem.

The second reason for the consolation step is the lack of an effective proposal writing capability. A winning proposal documents the solution that you have already sold the customer. You must sell it first and write the solution in a clear concise, and convincing manner. These two critical elements are often missing in a capture planning process.

Learn more about capture planning and the federal sales process at

Or call me directly, I’m happy to answer your basic federal contracting questions.

Richard White
301 908 0546 (cell)