How MACs can increase your bottom line

Part 1 of 4 in Lohfeld’s MAC series

What are Multiple-Award Contracts (MAC) and why should they matter to you? Simply put, a MAC is a basic contract awarded to multiple contractors against which they compete for task order awards. MACs are also referred to as Indefinite Delivery/Indefinite Quantity (IDIQ) and Government Wide Acquisition Contracts (GWAC). Federal Acquisition Regulations (FAR) govern how government agencies use MACs to procure goods and services. MACs should matter to every government contractor for five reasons.

  1. MAC spending represented nearly 25% of all U.S. Government spending in fiscal 2017.
  2. During the fourth quarter, which starts July 1, most of that spending occurs through MACs.
  3. Government agencies depend on MACs to support their workload due to compressed timelines and limited acquisition resources—especially in the fourth quarter.
  4. Many MACs are designated as Best in Class (BICs) contracts, and agencies such as the Department of Defense (DOD) are using BICs as their preferred method to acquire goods and services.
  5. Many agencies use MACs as their preferred method of acquisition, as illustrated in Exhibit 1.

Exhibit 1: Percent of contracting dollars that agencies spend flow through MACs as a percent of total dollars spent. On average agencies spend 35% of their dollars through MACs.

Agency/bureau MAC $
FY 2017
FY 2016-2017
MAC change
FY 2017
agency total
FY 2017 MAC agency share
Education $1.7B 6.1% $2.6B 68.4%
GSA $2.5B 1.7% $4.8B 53.4%
VA $12.8B 26.6% $26.3B 48.6%
DHS $7.4B 25.6% $17.0B 43.3%
Treasury $2.3B -3.1% $5.3B 42.8%
Commerce $1.5B -6.1% $4.2B 37.0%
HHS $8.4B 0.0% $24.5B 34.5%

Source: Bloomberg Government, BGOV MAC Analysis for Fiscal 2017, May 23, 2018.

In addition, government contractors can look forward to bidding on 18 MACs worth more than $200B during FY18 and FY19. Seven of the MACs are listed below

  1. OASIS: One Acquisition Solution for Integrated Services On-Ramps ($60B)
  2. Seaport-NG: Seaport Next Generation ($52.5B)
  3. NQIIC: Network of Quality Improvement and Innovation Contractors ($25B)
  4. CMMARS: Contracted Maintenance, Modification, Aircrew, Related Services ($12.6B)
  5. DEOS: Defense Enterprise Office Solutions ($8B)
  6. AFCAP V: Air Force Civil Augmentation Program V ($6.4B)
  7. CAF ADAIR: Combat Air Forces Adversary Air ($6B)

Source: Bloomberg Government, BGOV MAC Analysis for Fiscal 2017, May 23, 2018.

Be sure to check back next week for the important second article in our series about Big MACs!

by Brenda Crist, MPA, CPP APMP Fellow

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As the premier capture and proposal services consulting firm focused exclusively on government markets, we provide expert assistance to government contractors in Proposal Management and Writing, Capture Planning and Strategy, Capture and Proposal Process and Infrastructure, Go-to-Market Strategy, and Training. In the last 3 years, we’ve supported over 550 proposals winning more than $135B for our clients—including the Top 10 government contractors. Lohfeld Consulting Group is your “go-to” capture and proposal source! Start winning by contacting us at www.lohfeldconsulting.com and join us on LinkedIn, Facebook, and Twitter.