If you think about it, the steps of pricing to win a government contract is a lot like being a contestant on the game show The Price is Right, considering that you:
The Price is Right contestants don’t wake up pricing geniuses. They watch the game — a lot. They know the rules inside and out, study the competition, familiarize themselves with bidding strategies that have (or haven’t) worked for other contestants, and develop their own tactics based on that research. They know exactly what to do when they hear those famous words, “Come on down!”
And that mindset is exactly what you need to win government contracts.
At ProjStream, we've been in the pricing government contracts game for a long time on account of our basis of estimate software and other tools. As a result, we know what it takes to put together a list of pricing strategies that work. Here are our top five tips to pricing a government contract.
Before you even decide to respond to a request for proposal (RFP), ask the question, “Does it make sense to bid on this RFP?” You can spend a lot of money chasing work only to find out later your company’s capabilities and price points don’t match the government agency’s budget or should cost target for the project. The Federal Procurement Data System and FEDMINE are great places to start the research process.
To help you piece together an educated guess at an agency’s cost target for the project, consider:
You’re not the only one playing the price-guessing game. As part of releasing an RFP, the government agency has also gone through a pricing exercise to decide how much the work should cost.
NOTE : The RFP cost target doesn’t necessarily align with the value of the resulting contract award. The agency uses the RFP number to get funding for the project. This is part of the annual budgeting process discussed earlier. Agencies often incorporate risk management and cost estimating techniques to improve the accuracy of their budget plans as well as to evaluate whether the contractor’s proposal cost estimate is realistic.
To help you evaluate what the agency is thinking, consider:
Dig into previously awarded contracts. Look for how often quality won over price or vice versa, and pay attention to the pattern.
Some agencies consistently award contracts to contractors who have the best solution, even if the price tag is slightly higher than other bidders. Others tend to choose the contractor who has the lowest price technically acceptable (LPTA) proposal. Also be aware of any trends in agency procurement preferences, such as emphasizing firm fixed price contracts or using different procurement methods to get a product into the hands of personnel quickly.
Without taking some time to study award patterns, you run the risk of outbidding yourself or selling your services short, which can also affect your overall bidding reputation or profit margins.
We’re not telling you to adjust your direct labor rates, fees, or fringe rates. What we’re 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:
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 ( GSA) 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.
All the above sounds like a lot of work — especially if you start from scratch every time you want to respond to a new RFP. We feel your pain.
That’s why we created a basis of estimate software like BOEMax to streamline everything that goes into creating a data driven cost estimate, so your proposal stands out from your competitors.
You can produce high-quality cost estimates in less time because you have reliable source data to start with. Among the key features in our BOEMax proposal writing software are:
Then, give yourself a pat on the back for a job well done.
Perhaps one day you’ll find yourself alongside Drew Carey on The Price is Right, or maybe you won’t. But when it comes to pricing your next proposal, we hope you’ll remember our silly analogy, these 5 pricing strategies we shared, and how BOEMax bidding software can help make you a winner every time. Call us today to schedule a demo of our basis of estimate software.
友情链： im体育app下载安装|IM电竞体育赛事赛程在线|IM电竞体育推荐下注网址 | IM·体育直播官网_下载v0.6版_IM·体育数据最新赛事 | IM体育v7.2 安卓版-软件推荐-IM体育高清免费在线 | IM体育线上最新版观看-im体育赛事比分-IM体育app入口 | 2022im体育回放免费今晚_新版v7.9_2022im体育下注赛事 | im体育盘口软件-im体育app平台下载-im体育排榜结果最新 | IM体育开户注册_IM体育官网入口_im体育彩票app |