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GovCon Lifecycle: Purgatory to Paradise

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The second govmates institute, GovCon Lifecycle: Purgatory to Paradise met at the Northrup Grumman location in McLean, VA. In an authentic meeting-of-the-minds, industry experts discussed topics pertinent to growing the local govcon footprint.

Highlights from the institute include:

Purgatory: That Awful Time Between Submission and Award

  • BAFO’s, How to respond to government requests, FAR compliance, “Gotcha’s”“Proposals are rarely won at submission, but they are lost. If you get an EN – correct, don’t defend.”
    Barry Landew – Wolf Den    “To mechanically lower your price during ENs make sure you revisit trends to see where you can adjust.”
    Avantika Singh

30-60 Day Transition & Ramp-Up

  • Recruiting & Operations (Transition planning, Re-badging, Quality Planning, Customer interaction) –
    “Be sure to stay in touch with your key personnel and others that you bid after you submit your bid.  Fostering this relationship will cut down on your recruiting time.”
    Mary Holmes – BOOST
  • Contracts (Sub-K’s, Negotiations) –
    “Best advice that is not only the most obvious but the most overlooked – did you read the entire contract award and do you know what you are signed up for?  Make sure everyone on the team is aware.”
    Amanda Tyson – BOOST
  • Accounting (Accounting system set-up, Billing requirements, Types of contracts)
    “Make sure you get the labor category paperwork done up front because you could lose money if they don’t meet the qualifications.”
    Giacomo Apadula –  BDO

Opportunities in Loudoun County

  • “Insider baseball on AWS is coming to Northern Virginia. There is still a ways to go, there will be another downselect based on sites.”
    Steven Hargan – Loudoun Economic Development

Now That You’ve Won – How Do You Pay for It?

  • Have your contracts folks review the financing document.  It’s a contractual document – CEOs make sure you know what you’re getting into and completely understand the terms.“Be careful and read the fine print to make sure you’re actually getting the rate you think you’re getting from your financial providers.”
    Matt Stavish

Capture & Business Development for FY2019

  • Be strategic about your capture process – make sure it’s a rolling 36-month pipeline.
  • Focus on both getting onto some of the larger IDIQs (hello Oasis!  GSA Schedule 70!) and on agencies that award independently – who buys from you? 
  • Yes, there seems to be less direct sole sourcing opportunities and more competitively bid set-aside work for 8a’s.
    Kim Pack, Wolf Den

Join govmates to be updated on future opportunities for continuing education and targeted matchmaking! 

Shutdown Screws Small GovCons

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I normally never write about politics, recognizing that half of my network leans one way, while the other half leans the other.  I tend to live by the “no politics or religion” in public domain, school of thought.  But this latest shutdown has me completely livid over its stupidity and its potential impact on the small GovCon world.

While government employees will enjoy a day or two at home and will eventually receive their backpay for doing absolutely nothing (to be fair, through no fault of their own), small govt contractors will not fare as well.  Those deemed non-essential will generally be forced to use their PTO to stay at home while the work piles up.  Given the last-minute call, few companies have their act together enough to deliver all day training sessions for their employees today to use their overhead dollars wisely.  Outside of PTO, it’s leave without pay (LWOP) as generally, we can’t put your expense on overhead, driving our multiplier up and our competitiveness down.
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While a day or two (which hopefully all this is) won’t kill any company, the more it lingers, and the more uncertainty, the less willing smaller companies will invest, hire employees or make decisions.  The indecision of the government funding grinds most smaller companies to a halt.  Small business does not have the cash reserves that the billion-dollar club has.  They are subjected to pay-when-paid terms as subs, and there’s no one in the government paying contractors, so cash dries up.  Back in 2013, the impact of 16 days of shutdown wiped out net income for the year.  If you were living month to month on 4% profits, just one pay period worth of not billing was devastating.

Enter January, when PTO balances are reset, and lower due to the holidays.  Credit card bills from the holidays are due this month.  New hires have just started with the new year with zero PTO built up.

The talking heads blame each other and throw out the military and payment but to be honest, they will be fine.  They will receive their paychecks.  As will the hundreds of thousands of government officials who stayed home today.  They will come back to more backlog (thank you for all the hiring freezes).  RFP releases, contract awards, and payments will all be postponed, directly impacting contractors.

Large GovCons will weather the storm, utilizing their cash reserves, blaming the shutdown for poor earnings reports and postponed contract execution.
Small GovCon, you will be screwed should this last any length of time.

And don’t even get me started on passing another CR.