GovCon FAQ #4: What are the types of contract awards that I can win?

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Updated on: February 26, 2021

 

There are a variety of types of contract awards available to companies in the government contracting space, all of which have significant implications on the short and long-term operations of the company.  

When it comes to bidding on a contract award, it’s important to understand what type of administrative support is needed. We talked briefly about some of the benefits of working with the federal government in a previous video, but there are also some barriers to entry from an administrative standpoint. Surrounding yourself with a team that understands the pluses and minuses as well as the difficulties and nuances of the government contracting space can set you up for success both in the short- and long-term.  

Award classifications include but are not limited to 

  • Full and open  
  • Small business set-asides  
  • Contracting assistance programs 
  • Joint ventures 

Full and open contracts are where you’re competing against everybody in the market, anybody can bid on them.  

Small business set-asides, which we touched on briefly in the first video, are a way to level the playing field, giving companies a way to compete with some of the larger companies or to set-aside so that they don’t have to compete with those larger companies. This makes it easier for everyone to have a chance at bidding on some of that work. Companies that meet certain criteria prescribed by the small business administration can apply for small business set-asides, defined by FAR part 19, that limit the competition for certain contractAdditionally, there are small business programs available including 8(a), Hubzone, Women-Owned and Services-Disabled Veteran-Owned that are designed to award contracts to those businesses who meet certain disadvantaged social and economic criteria. 

Then, there are contracting assistance programs and joint ventures. It’s important to understand joint ventures because this is a huge area where companies in the government contracting space can partner up with another company to bid on a potential government contract. It’ll be important to understand some of the rules and compliance behind these types of contract awards and have somebody that is experienced in business development on your team to capitalize on these opportunities.  

A key term that we’d like you to take away from this is a “contract vehicle,” which is a streamlined method used by the government to obtain a contract. Once on the vehicle, the ability to pick up actual work in the form of task orders is less competitive and quicker to turn around. It is important for the company to understand which options are available to get on a vehicle that could help add value to the company in the short- and long-term; in other words, you want to understand which have produced good results because getting on a contract vehicle allows you to go after additional task orders. In a later segment, we’ll discuss the different tools available to help understand what options are available to best set up your company for long-term success.   

If you get on an indefinite delivery/indefinite quantity (IDIQ) contract, does that mean that your company’s immediately worth the entire contract value? Typically, no. That means that you have the ability to go after work that’s issued through that IDIQ, which can often create confusion.  

Ultimately, building your team, your accountants, a legal team, and business development is an essential part of understanding what type of contract awards you want to go after and if you want to utilize some of those small business set-aside programs.  

If you have any questions about a potential award that you’re exploring and how to make yourself competitive, feel free to reach out and we can talk at any time.  

Next Up: GovCon FAQ #5: What are the types of contract terms on a federal award and how do indirect rates apply?

 

Our experienced professionals are well versed in accounting, consulting, tax, and audit and can help you navigate the complexities of government contracting to support, optimize, and accelerate your success. Get in touch with our team→

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