Just because COVID-19 is forcing us indoors doesn’t mean that we can’t get together and learn from one another. Recently, Lohfeld Principal Consultant and Capture expert Dr. Doug Himberger interviewed former GSA Contracts Director, Jacob Bertram. In this final installment, Doug asks Jacob about focusing on the competitive range as part of developing a strategy for winning business at an agency. For the previous installment, click here.
[Doug] The bundle contracts are getting bigger, and the task orders within them also are getting bigger. There are higher-value targets coming up now. What should industry in general, whether it’s large or even small businesses, focus on so that they stay in the competitive range, in terms of cost, and perhaps other things as well?
[Jacob] While I was at GSA, one of the things we studied was the competition rates on managed vehicles like GSA schedules and GWACs and then also on open market procurements—things that did not come through a managed vehicle. And what we saw was under the managed vehicles, the competition rates were significantly less. There were three to four proposals or quotes per solicitation. On a lot of them, there were only one or two. This was especially true when you get into the higher dollar values, or if you get into shortened RFQ timeframe. Clearly, if you only have 2 weeks to respond, companies are going to be use their B&P dollars somewhere else.
When we looked at the open-market solicitations, out there for anyone in the world to compete, we saw the average increased to 14 to 16 or so proposals submitted. However, I would say only the top three to four were truly competitive. So, even though you had 14, that doesn’t necessarily mean it was better competition. Sometimes they had inadequate systems or it was their first government contract. Perhaps the proposals weren’t adequate to begin with, or there was just no history on them. And those are inherently going to be higher risk, and as we said before, the government doesn’t like risk. So, whether you’re focused on managed vehicles or open market, I would say the competition is roughly the same—there are only three to four against whom you’re competing that are really staying in the competitive range.
My assumption is most companies are in the competitive range that meet the basic standard proposal requirements and submit an adequate proposal. So, there was no science behind the number in the top 10% or 15% or something like that. But if you have one price that’s incredibly low, or one with a price set incredibly high, then those might be outliers. And those might be out immediately, because a price way out of line might suggest they don’t understand the requirements. But my guess is that companies that are actively bidding in the government space know right around what price a job can be done for. Then the focus really becomes on the past performance, the technical approach, and being able to deliver the best value.
[Doug} Thank you. This has really been helpful to me, and I would expect for our readers as well. I appreciate your bringing all of your background and your expertise to this.
We plan to have Jason back for another conversation. If you have questions you would like answered, please contact us directly.
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