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Wednesday, April 10, 2024

Your Small Business Government Contracting Business Plan




Infrastructure funding, world events and the fast pace of technology are venues in which federal funding programs are enacted, grown and made part of the culture.  

They are on the way.  There will be dramatic roles for small business. 


INTRODUCTION:


 When visiting the SBA website on business planning, there are major topics in the business planning process which, when addressed in a plan, will insure the success of an enterprise and assist  in determining and supporting the amount of funding needed. SBA Write a Business Plan

This discussion addresses the unique aspects of federal government contracting that will yield a successful plan and more importantly a successful execution of that plan in the federal contracting venue.  


Marketing, advertising, competitor analysis and financing must be addressed.  Free articles on strategic planning and developing a marketing plan are at the “References” Box Net Cube at the top right margin of this site. They address evolving an operations vision for an enterprise showing its potential to present to a banker or to an investor.

Here is a site with free business plan samples:


Business Plan Samples

It may assist in visualizing business growth to look at an example of how someone else addressed a given topic.

NICHE DEVELOPMENT

Product entrepreneurs all face the same challenges. Those who succeed recognize they need to visualize themselves in the product development business, structuring an enterprise, generating a business plan, protecting intellectual property and then seeking industry partners and investors to bring the product to market.

In the process, copyrights, patents and royalty issues may come into play and development and distribution agreements are formed. Pricing is finalized based on cost and expense projections and competitive factors unique to the company as negotiation results are achieved with industry teaming partners, developers, manufacturers and distributors.


Service contracting to the federal government is a natural venue for small business. It does not require a product with a niche market or capital intensive manufacturing facilities. Service contracting does require skilled management and labor resources capable of performing a scope of work for which the government has identified a need and for which outsourcing to an industry contractor has been selected as the means to fulfill that need. The venue demands strong human resources management, industry teaming and an enhanced business system to price, account and bill on a job cost basis under government service contracts.


REGISTRATION

Utilize the below link to register your company.  It provides excellent guidance and background, as well as access to the PDF file on NAICS Codes which are critical for you to choose before you begin the registration process.  Give these some careful thought when selecting them.  If there is a chance your firm may wish to be involved in a field, put the code in your registration.  No one will question your qualifications at this point.  That comes later during proposals. 
Note the requirement for a DUNS number up front.  You may already have one.  If you do - use it.  If you do not, follow the instructions on obtaining a DUNS free at the Dunn and Bradstreet web site.  
When you have completed your registration at the link below you will received a Government CAGE Code, uniquely identifying your firm and its location as a government contractor. 

MARKET RESEARCH

As a small business becomes known in the federal government contracting community, successful marketing of sole source or group-designated business becomes easier, but it is always a challenge due to the need for taking early action in windows of opportunity. 
Find those windows and communicate capabilities to the decision makers and industry team members who can help you.  
If you are eligible for set aside designations make small business set asides or sole source procurements key elements in your marketing plan. 


TEAMING

Be straight-forward and honest with  industry teaming partners.

Do not violate share arrangements, teaming agreements or non-disclosure agreements. Such violations are a death knell for your reputation in the business.

Do not become known as a resource raider by hiring away from other firms with whom you have teamed.

Give it a best shot as a prime or a sub but involve the government contracting officer to resolve industry teaming disputes that may damage a past performance record.

Exclusivity is the practical way to go on any given program. Team early and exclusively and be a winner. 
Reputation is key, ethics count and  customers as well as the industry are observing.


BUSINESS SYSTEMS DEVELOPMENT

Waiting for a contract award to achieve a government contracting business process is not advisable. A win may not happen at all without addressing the structure and process requirements in your proposal to convince the customer his business environment is understood.

If one is not prepared in advance and one is fortunate enough to win, then in a very short time frame one will have to evolve a business system to perform on the contract and submit a billing

This article will discuss a framework for a small enterprise to develop a business system in service contracting, which is the most frequent venue utilized to enter the government market.



PROPOSAL PREPARATION

Government contract proposal preparation is time consuming and can be costly. Meeting the agency Request for Proposal (RFP) requirements with a responsive proposal can be well worth the effort if a winning strategy can be formulated. When considering submitting a proposal to a given government solicitation, conduct a bid/no bid exercise.

By going through that process  a company  begins formulating your win strategy or it will discover that it should not bid this job for lack of such a strategy. The elements of the process are discussed below in the form of questions to ask  against topics for key consideration

This article offers guidance as a template to apply marketing operations for accommodating federal government contract proposal preparation. Proposals are special, sometimes exhausting projects, but a necessary part of doing business with government agencies. Like many other aspects of business, the more proposals that are prepared, the more that is learned and the more one can borrow from past practice for the next one.


PROJECT MANAGEMENT

Strategic thinking must be applied to structuring a government service contract project management capability in your company. It must involve long term planning and designing a business system as well as establishing rates and factors to bid new work and control it while interfacing with the customer.

When one plans in detail to define the product or the service one reduces performance risk. 

The project management challenge is not to launch significant and costly resources before the specification for the product is sufficiently defined, obviating the need for costly revisions or abandonment, yet knowing when the product definition and plan are suitable for release.

Good project management starts early.


SUMMARY

Consider the advice herein when developing and maintaining your business plan. Overlay approaches unique to the company against the guidance offered and place it in the standard format for business planning.  It will yield a road map for success and can be further evolved for growth.

For additional  details on these topics and other important information in developing and executing a government contacting plan, download the free books and supplements available in PDF format at the “Box” in the top right margin of this site.

Seizing the Moment






Monday, April 8, 2024

For April 2024 National Volunteer Month – What Makes It All Worthwhile?

 

The ultimate reward ? When a small business puts their own unique twists on basic suggestions and develops a thriving enterprise.

_____________________________________________________________________

I had two mentors at key points in my 36 year career in Aerospace.

They were a combination of technical, management and communications talent, rarely found in high tech industry. Neither placed salary, position or ego ahead of developing their subordinates and each reached the pinnacle of their respective careers for exactly that trait.  Their skills at developing and utilizing people were their most highly valued qualities.

I owe my survival in a very hectic environment to those two and much of my ability to guide and counsel individuals as well as communicate effectively springs from their legacy of guidance.

 Mentoring can be a dynamic, two way street.

The most successful organizations pair experienced personnel as models on a staff basis with junior ones. Each has individual assignments and reports to the boss but the senior party is the example in the process/experience-driven aspects of the job and is available to answer questions. The younger individual infuses the older one with energy and new ideas much like osmosis.

The result is a hybrid of old and new that has been put together by a team. The approach works extremely well, imposes on no one, results in the young and old learning by observation, satisfaction and recognition for collective efforts and reduction in the boss’s work load. A “Win-Win” all around. 

Small business volunteering has kept me active in retirement, in touch with my profession and engaged in a continuous learning mode. It has been my “Window On The World” in pursuing those objectives.

I believe we are growing entrepreneurs more than growing monumentally successful enterprises. They, in turn, will grow their unique forms of business using their efforts, not ours. We do not do it for them. They do it for themselves. Hopefully our suggestions help. I have been pleased again and again when a small business owner took my basic suggestions, put their own unique twists on them and developed a thriving business. That is the ultimate reward.

I help with background and knowledge for the entrepreneur to consider as he or she makes decisions. I experience satisfaction every day from the work and I value being useful to highly motivated entrepreneurs who wish to succeed.

I view volunteer counseling much like a garden—a place to plant seeds, a place to grow fruitful enterprises and a place to harvest personal satisfaction and the gratitude of others.

Friday, April 5, 2024

Contract Line Item Structure - The Heart of Your Federal Government Business Deal


Contract Line Items (CLINs) specify products or services being procured and the negotiated prices for them. 

Carefully review (CLIN) relationships to other critical elements of your contract for consistency before proposing, accepting and signing your deal.

Housed in Section B of your contract, contract line items are critical for reporting and billing purposes in your accounting system. Invoices to the government for supplies or services delivered must reference the associated CLIN. 

For service contracts that are cost-based such as Time and Materials (T&M) or Cost Plus and for progress billings under fixed price contracts, your job cost accounting system must be able to track labor, material and other direct costs at the CLIN level or below to provide auditable details for payment approval.


Government requisition and appropriation data against the CLIN are carried throughout the government finance and accounting system that makes payment on your invoices. CLIN’s form the backbone upon which all the other contract sections are built. If the CLIN structure is defective, it is likely many other areas of the contract will also be deficient.


During the “Sources-Sought”, “Pre-solicitation” or “Draft RFP” stages of a procurement the government often invites industry to comment on the evolving solicitation. The CLIN structure should be evaluated in relation to such items as the Work Breakdown Structure (WBS), the Statement of Work (SOW) and the contract schedule from the perspective of visualizing the work underway, tracking and reporting the status and finances of deliverables, inspection and acceptance and accurately billing the deliveries on invoices.

If the agency is establishing a poorly integrated CLIN structure you should comment appropriately to the contracting officer, suggesting corrections and additions to establish a framework against which your enterprise can estimate effectively, operate efficiently, report accurately and bill without experiencing delays. Most agency contracting shops appreciate such contributions.


SECTION C - DESCRIPTION/SPECIFICATIONS/STATEMENT OF WORK
As you read the narrative in this section, carefully establish that it adequately covers all the CLIN's in Section B. During the proposal process it is wise to matrix each paragraph of the SOW to its associated CLIN so you are sure your CLIN level prices have adequately covered the scope described in the SOW and that the SOW addresses each of the CLIN's identified in Section B. If there appear to be omissions point them out. Note where the SOW conflicts with or does not adequately describe the applicable CLIN's in Section B. Also note where there may be missing CLIN's. Then offer either a revision to the CLIN structure, a revision to the SOW, or both.
SECTION D - PACKAGING AND MARKING
Insure that the instructions in this section cover each of the CLIN's in Section B and that your company can comply with any specifications referenced.
SECTION E - INSPECTION AND ACCEPTANCE
Review the criteria for accepting the products and services to be delivered by CLIN as well as the location where deliveries will take place. Insure your company can comply with the criteria for acceptance. A payment will not be made without government acceptance of your delivery.
SECTION F - DELIVERIES OR PERFORMANCE
This section will replicate Section B and specify the due dates for deliveries by CLIN. Insure you can comply with the dates indicated.
SECTION G - CONTRACT ADMINISTRATION DATA
The accounting and appropriation data in this section must be replicated where necessary in your bill to the government by CLIN. Please see the article at this blog entitled, "Government Contract Billing":
SECTION H - SPECIAL CONTRACT REQUIREMENTS
Check for any special requirements, such as Earned Value Management Systems, the requirement for a Work Breakdown Structure against which to report cost and schedule data and other clauses such as Design to Cost/Life Cycle Cost, Reliability, Safety and Failure Analysis reporting requirements and similar specifications. If you find such requirements, carefully review the reporting structure therein for consistency with the CLIN structure of the contract and point out any disparities to the Contracting Officer.
SECTION I - CONTRACT CLAUSES
Carefully review this section in the same manner as Section H.
SECTION J - LIST OF DOCUMENTS, EXHIBITS AND OTHER ATTACHMENTS
The Contract Data Requirements List (CDRL) will be in this section. Insure there is a separate CLIN for data items. Most contracts price data at zero cost and include the cost to prepare the data in other CLIN pricing. Determine which of the CLIN's will be affected by the data items required in this section and insure the pricing for those CLIN's includes that cost. Perform an identical review of any other documents contained in this section.
SECTION K - REPRESENTATIONS, CERTIFICATIONS AND OTHER STATEMENTS
Insure that all information provided in this section is consistent with the data specified in each of the sections above.
SUMMARY
By conducting a thorough review of the CLIN structure against all other sections of your prospective contract you will establish a consistent framework and an integrated approach to tracking and reporting the status and finances of deliverables, inspection and acceptance of same and billings that will be promptly paid.  

The following is an example of a typical federal government contract CLIN structure:

SECTION B - SUPPLIES OR SERVICES AND PRICES

ITEM NO SUPPLIES/SERVICES
0001 SBIR RESEARCH AND DEVELOPMENT
Firm Fixed Price
The contractor shall perform research and development efforts in
accordance with Section C and the Contractor's SBIR Phase I
proposal dated September 2002 in response to SBIR Topic N02-140

ITEM SUPPLIES/SERVICES QUANTITY UNIT UNIT PRICE AMOUNT
NO
0001AA Monthly Status Report 1 LOT $11,000.00
The contractor shall perform research and development efforts and
provide the First Monthly Status Report in accordance with CDRL AO01.

ITEM SUPPLIES/SERVICES QUANTITY UNIT UNIT PRICE AMOUNT
NO
0001AB Monthly Status Report 1 LOT $11,000.00
The contractor shall perform research and development efforts and
provide the Second Monthly Status Report in accordance with CDRL A00I

ITEM SUPPLIES/SERVICES QUANTITY UNIT UNIT PRICE AMOUNT
NO
0001AC Monthly Status Report 1 LOT $11,000.00
The contractor shall perform research and development efforts and
provide the Third Monthly Status Report in accordance with CDRL A001.

ITEM SUPPLIES/SERVICES QUANTITY UNIT UNIT PRICE AMOUNT
NO
0001AD Monthly Status Report 1 LOT $11,000.00
Phase 11 Program plan
The contractor shall perform research and development efforts and
provide the Fourth Monthly Status Report in accordance with CDRL A001
and the Phase 11 Program Plan in accordance with CDRL. A002.

ITEM SUPPLIES/SERVICES QUANTITY UNIT UNIT PRICE AMOUNT
NO
0001AE Monthly Status Report/ 1 LOT $11,000.00
Preliminary Report
The contractor shall perform research and development efforts and
provide the Fifth Monthly Status Report in accordance with CDRL A001
and the Phase I Preliminary Report in accordance with CDRL A003.

ITEM SUPPLIES/SERVICES QUANTITY UNIT UNIT PRICE AMOUNT
NO
0001AF Contract Summary 1 LOT $13,587.00
Report
The contractor shall perform research and development efforts and
provide the Phase I Final Report in accordance with CDRL A004.

CLIN 0001 TOTAL $68,587.00

ITEM SUPPLIES/SERVICES QUANTITY UNIT UNIT PRICE AMOUNT
NO
0002 DATA 1 LOT *NSP *NSP
DELIVERABLES
Firm Fixed Price
The contractor shall provide the data deliverables in support of
CLIN 0001 in accordance with attached CDRLs.
* - Not Separately Priced

ITEM NO SUPPLIES/SERVICES
0003 OPTION CLIN
SBIR RESEARCH AND DEVELOPMENT
Firm Fixed Price
The contractor shall perform research and development efforts in
accordance with Section C and the Contractor's SBIR Phase I proposal
dated September 2002 in response to SBIR Topic N02-140.

ITEM SUPPLIES/SERVICES QUANTITY UNIT UNIT PRICE AMOUNT
NO
0003AA Monthly Status Report 1 LOT $9,000.00
The contractor shall perform research and development efforts and
provide the First Monthly Status Report in accordance with CDRL A001.

ITEM SUPPLIES/SERVICES QUANTITY UNIT UNIT PRICE AMOUNT
NO
0003AB Monthly Status Report 1 LOT $9,000.00
The contractor shall perform research and development efforts and
provide the Second Monthly Status Report in accordance with CDRL AOO1.

ITEM SUPPLIES/SERVICES QUANTITY UNIT UNIT PRICE AMOUNT
NO
0003AC Contract Summary 1 LOT $11,490.00
The contractor shall perform research and development efforts and
provide the Phase 1 Final Report in accordance with CDRL A004.

CLIN 0003 TOTAL $29,490.00
-
ITEM SUPPLIES/SERVICES QUANTITY UNIT UNIT PRICE AMOUNT
NO
0004 OPTION CLIN 1 LOT *NSP *NSP
DATA
DELIVERABLES
Firm Fixed Price
The contractor shall provide the data deliverables in support of
CLIN 0003 in accordance with attached CDRLs.
* - Not Separately Priced

CLINS 0001 - 0004 TOTAL $98,077.00


Tuesday, April 2, 2024

Acquiring An Incumbent Work Force As An Element Of Winning A Government Contract



INTRODUCTION

During the course of marketing to the federal government the small business will encounter opportunities involving potential for acquiring an incumbent work force as an element of winning a contract.  The acquisition of existing personnel already performing on a service contract is a way to exponentially grow a small enterprise. 

The purpose of this article is to discuss the acquisition of an incumbent work force and effectively managing the associated potential and challenges.

BACKGROUND

We have previously discussed planning and business systems for service contracting at the following postings:

The above articles discuss basic business organization and systems necessary to support the service contracting environment and bring an incumbent workforce into a company.

HOW INCUMBENT WORK FORCES ARE PROPOSED

Your market research into future acquisitions in the service contracting industry to the federal government will lead you to existing work forces subject to assumption by a winning contractor.
Base operations contracts, long term service contracts of an IDIQ nature and similar programs have competitive phases or are re-designated for a small business prime contractor if the government deems a pool of qualified companies is available to compete. Researching potential programs of this nature and marketing them is discussed in the following article:

Marketing to Achieve a Small Business Set-aside Contract

In some instances a larger contractor holding the existing work force is displaced from a program to meet agency statutory requirements for contracting to small business or because the existing contractor has grown to exceed the size standard for a small business on the program.  

Under these conditions a teaming arrangement may be possible with the departing contractor,resulting his assuming a lesser role in the effort (we suggest no more than 40%) as a subcontractor to you.  Do so only if the company is highly regarded by the customer from a past performance perspective and when you can negotiate an exclusive arrangement with him during the proposal phase of the program. Teaming arrangements are discussed at the following posting:

Small Business Teaming

If a teaming arrangement cannot be achieved with the existing incumbent you must gain access to the incumbent personnel salary history and benefits to effectively bid the program for the out years in response to a solicitation.  Speculating on what the personnel make or relying on the government or the incumbent to provide the data is risky. Although some solicitations will provide a government “Wage/Rate Determination”, that document is the minimum and seldom represents the actual salaries of the employees. The only other meaningful document commonly provided is a union bargaining agreement still in force. 

Some companies will publish a help wanted advertisement in the local paper and invite the incumbent personnel to attend an off site open house, asking for sign offs on contingent hire agreements for use in the proposal, together with resumes:

It is important to remember that although the RFP may go so far as to say incumbent personnel have first rights of refusal for future positions, you are not legally obligated to hire what you feel are poor performers. You will, however, have to specify your criteria for personnel selection in your proposal and, especially for personnel the government has listed as “Key” in the RFP, explain how you intend to utilize existing people or bring in new ones. 

The competitive environment on a given procurement will drive how much you disclose in the way of openness in terms of publicly announcing your intentions to bid and acquire the personnel data you need to do so effectively.  You must conduct effective research and propose a winning wage and fringe package that appeals, not only to the personnel you wish to retain, but also to your customer.
Do not count on gaining access to incumbents through the government or being able to go on government property to interview them.  In most instances you will not be allowed to do
so or it would compromise your proposal from a conflict of interest perspective if you did. 

 A TRANSITION PLAN IS KEY

A winning proposal will have solid plans for recruiting and retaining the existing work force, executing a transition plan and insuring that the government does not encounter an interruption in services.

 Carefully analyze the solicitation requirements for elements for which the government expects to see a response pertinent to incumbent personnel. Prepare a graphic schedule and specific set of activities to transition the incumbent personnel to your company after contract award. Make sure the activities are overlaid upon the technical and management schedules elsewhere in your proposal and supports them. 

Your transition plan topics should address administrative, human resources, training and similar factors to insure a seamless process.  

SUMMARY

Acquiring an incumbent work force poses both opportunities and risks for a small enterprise.  Understanding the above factors and assessing your ability to manage the challenge will best prepare you for the decision whether or not to bid such a program. 


Thursday, March 28, 2024

Why Social Network To Promote Your Small Business?


                                                              
INTRODUCTION:

Personal, professional and business branding is occurring regularly, whether or not we are aware of it.

From our web site presence to our postings on the sites of others, from our credit ratings to our cell phone records and application navigation, we are tracking others and being tracked ourselves.
 

Deciding to become active in social networking is really a matter of managing personal, professional and business images/brands or having them manage us. 

THE INTEGRATED SOCIAL NETWORK

Networking is a vital tool in achieving an image/brand. Establish a network like a wheel. The hub is core content (web site, blog, books, articles, useful materials). The spokes leading from the hub are the tools to network content that is linked to the hub.
 

Contacts are the engines that power the wheel.

Content is the fuel that feeds the social networking contacts and powers the wheel. 

As the wheel turns, the quality of the networking improves with feedback and the wheel climbs the optimization hill of the major search engines (SEO).
 
Limiting factors are the quality of the core content and knowledge/persistence in networking.





CONTRIBUTE TO OTHERS

Blog, post and contribute to Q&A features on several sites:

1. It allows insight in solving the difficulties of others; always a satisfying achievement, dovetailing with professional endeavors and creating a positive image.

2. The manner in which a response is worded conveys values, expression, opinion, and insight to others who may wish to team, counter with a disagreement or pass on a reference to others; all healthy forms of communication.

3. Ratings features allow evaluation of responses by a large peer group.

4. With the growth of social networking international participation increasing dramatically, it provides insights into perspectives from other nations and cultures; a valuable input in the wired global economy these days.

5. The historical record of questions and answers, posting content and feedback is searched regularly by a large, world-wide community and draws others to profiles and web sites long after the initial dialogue has occurred.


MAKE PRUDENT JUDGEMENTS

Evaluate other net-workers for consistency. Value the participants who realize these are huge and open forums and who keep an open mind to input.
 

Do not value narrow minded use of these features for exclusively personal or business gain, control freak attitudes, and those who delete replies or answers because they disagree with the responses they are getting or are not getting what they perceive to be desirable results. 

THE END PRODUCT:

A brand, an image and valued content, carefully cultivated,  exchanged and viewed regularly with others and communicated for success. 

Please see the below link for an example of how the above principles are applied.

Integrated Utilities Linked as a Composite on "About Me"