Tag: Subcontracting

Donnie Harris: Retired Contracting Officer with an Unlimited Warrant to Write Billions in Contract Actions

Posted on by Eric Coffie

Navigate the government contracting market with retired military contracting officer Donnie Harris.

BACKGROUND

Donnie Harris is a retired military contracting officer who served two decades for the Coast Guard Office of Chief Counsel, Procurement Law Division, and the Clerk of the Court/Paralegal for the Coast Guard Court of Military Appeal.

Throughout his tenure, Harris participated on various radio shows and trained thousands of military and civilian personnel on topics ranging from preparing a statement of work to updates on the FAR.

Over the course of these years, he managed complex and high-profile procurements totaling $1.2 billion from the acquisition to the pre-award phase. 

After retiring, he was employed by numerous companies that wanted to utilize his procurement experience. 

CONTRACTOR PURCHASING SYSTEM REVIEW AUDIT

What that audit means is when you’re dealing with a cost reimbursable contract, you have to have an approved purchasing system that is approved by the government.

Huge companies like Booz Allen Hamilton use this process in order to ensure that everything, from the reqs and certs to the subcontractor agreements, are dated and signed correctly.

The reason is that if you fail too many audits, then that’s going to go into your past performance.

You may have an outstanding technical solution, but because you’re not able to pass an audit and it is reflected in your past performance, then you’re probably not going to win.

This is why Harris worked with a whole department in Booz Allen that was strictly dedicated to doing this audit. 

SUBCONTRACTING GOALS

Under the subcontracting goal, huge companies that do federal works need to subcontract a certain percentage of their work to small businesses. 

For instance, you’re not going to get a small business who can build a $3 billion bridge. The reasons may include the fact that they don’t have the infrastructure, the resources, and the technical knowledge and expertise to build a bridge.

Still, these small businesses can do some of the legwork, like dirt removal, concrete, and other of the small jobs. This is where the subcontracting goals come into place. 

However, depending upon the requirements, there are firms that really don’t have to adhere to the subcontracting goals, especially if there’s no subcontractors out there that can perform that type of work.

This happens when the vendor or the offerors have done their market research and found that no small business can fulfill the requirements.  

SMALL BUSINESSES ARE MISINFORMED

In Harris’ experience, he had to disqualify a lot of small businesses because they did not even maintain the basic requirements needed. 

For example, in putting solicitations online, they use keywords that only certain companies know. Why? Because this shows the level of expertise that that company has.

Apart from that, contracting officers have specific requirements depending on the contract. So, if you don’t follow any of these, then you can certainly be disqualified. 

For instance, if it is written that you need to use an 8 1/2 X 11 size of paper, then you need to really send your proposal using this size.

These are just the little things people on the government side uses in order to eliminate companies that could really not fulfill the requirements.

THE CONTRACTING PROCESS

The government usually receives two proposals: the technical proposal and the pricing proposal. 

The technical proposal is going to address how you are going to match or apply the requirements. Within this, the agency usually asks for your resumes, technical capabilities, resources, and past performance. 

Meanwhile, the pricing proposal is how are you going to price it. This includes what labor rates you are going to use and what labor categories you are going to use to accommodate these requirements.

Now, let’s say your technical proposal and your price proposal are both acceptable and you won a single award. Then, you will move to the negotiation, the final offer, and the kick off meeting about certain requirements. Lastly, you will start working.  

On the other hand, if it is going to be a multiple award, that’s when the agency will issue different task orders or requests for quotes towards you and other companies in the pool. 

What will happen in this kind of award is that you will price every time there’s a task order and that agency will choose the lowest bidder.  

RESOURCES

If you want to learn more on how to navigate the government contracting market with retired military contracting officer Donnie Harris, then be sure to click the resources below.

You can also visit the GovCon Giant website or the new GovCon Edu where you learn everything about government contracting!

011: Donnie Harris – Unlimited Warrant to Write Billions in Contract Actions

https://www.youtube.com/watch?v=R_H15m0jKgY

Let’s Talk About Subcontracting

Posted on by Eric Coffie

There are a handful of ways to get into the federal marketplace and one of these is being a subcontractor so let’s talk about subcontracting in this article.

BENEFITS OF BEING A SUBCONTRACTOR

Subcontracting is probably one of the strongest ways to learn the industry and how to navigate your business in the marketplace.

This experience provides contractors a critical viewpoint on how to handle certain contracts because when you are a subcontractor, you get to experience the necessary tasks to complete the assignments in the contracts.

These include understanding how to present the necessary specifications and how to submit these as well as building relationships with other contractors and decision-makers.

“So, you’re being paid to learn and then you’re gonna be accumulating a wealth of documentation. You’re gonna be making relationships with people who can eventually be partners.”

However, the benefit of being a subcontractor will only be fully achieved if you’re out there on the job. These can’t be retained by just getting certifications and sitting behind a computer. You have to go out there in the field, do the work, and be willing to learn and get a grasp of things.

“All this is going to be great for your arsenal of tools and your toolbox so that when you’re ready to step out and become a prime, you already have all the documentation. You know all of the ins and outs.”

WHERE TO LOOK FOR PRIME CONTRACTORS? 

There are a handful of sites that you can look for prime contractors and these include FPDS and USA Spending. It doesn’t matter what industry you are in, you will surely find prime contractors buying the services that you offer if you go into these websites.

The GSA also has a free tool which is the public category management dashboard that helps your search for prime contractors. In using this tool, you can easily look up the companies that have GSA schedules and pull out their information and reports depending on your criteria.

“Let’s take advantage of some of the tools that are already out here… That’s why we talk about subcontracting where all you have to do is find out who’s winning the contracts and reach out to them to become a vendor.”

ADVICE FOR SUBCONTRACTORS

If you are new in the marketplace, one way to increase your understanding of the federal arena is to find other contractors as well. It is key for each small business contractor to find each other and build a connection that might lead to various projects and more opportunities.

Then, when you are given a project, even as a subcontractor or for other smaller projects, you must always deliver your tasks the way you are told to do so. Consider that by doing your task accordingly, you and the prime contractor together with the government agency are benefiting from each other. Other than that, this will also help you increase the length of your contract or be given more contract opportunities.

“When people get a hold of someone like that, they don’t let them go. There’s been numerous cases where with my podcast guests we talked about them winning their first contract that was supposed to be six months that turned into 10 years.”

Also, you must view the problems in your business as a learning experience. When you are starting in your business, you are growing and because of this, you will also experience a lot of ups and downs.

With this in mind, one of the major problems of new businesses is having a fund but this is not a hindrance for you to stop your business. Consider that as a new contractor, you are a huge risk to the bank. So, you need to pull yourself together and search for other ways to fund your business so that you can start working with the government.

“A lot of people out here are tippy-toeing inside of contracting, right? They want to tippy toe in business like, ‘I’m gonna put my foot in and see.’ You can’t do that. It’s really hard to be successful by tippy-toeing.”

RESOURCES

If you want to watch the full video where we talk about subcontracting and other content related to it, then be sure to click the links below:

Let’s talk about Subcontracting

https://www.youtube.com/watch?v=ZbM0c5Olqr0

Explaining the rules for subcontracting small business contracts

https://www.youtube.com/watch?v=ajwQiCAS1No

Contact center SaviLinx experiences rapid growth in federal market as a subcontractor

https://www.youtube.com/watch?v=yaPoWjfmykA

028: Angela Terry – Small Business Administration Subcontracting Program Manager | Eric Coffie

https://www.youtube.com/watch?v=w8MvSXYv6yY

Similarly Situated Entity helps Limitations on SUBCONTRACTING for small firms – Eric Coffie

https://www.youtube.com/watch?v=8-4Lml2bZj4

Explaining The Rules For Subcontracting Small Business Contracts

Posted on by Linette Genao

Forget the rumors, myths, and misconceptions surrounding getting a contract and subcontracting the entire thing. The short and sweet answer to the ever so popular question, “Can I just sub out the entire contract?” is NO.

Knowing how to play the game and the rules of the game allows you to be successful. This is one of those rules you need to know and be aware of. However, you can get creative with how to abide by this, which is provided in the video below.

But how exactly do you avoid getting in trouble with subbing? Knowing FAR Clause 52.219-4 Limitations on Subcontracting.

subcontracting 50%First, let’s be clear that this rule only applies if you are the prime contractor. The rule is, as a prime contractor, if you provide a service, you must do 50% of the work. If you provide supplies, other than, “from non-manufacturer of supplies,” you also need to do 50% of the work.

For example, if the government puts out a quote for iPads, this doesn’t apply because you are a “non-manufacturer.” Since most of us aren’t the manufactures, this doesn’t apply. But if the government needed shirts and you’re making shirts for the government, then you’d need to make 50% of the shirts.

The 50% includes services like janitorial transportation, logistics, accounting, legal services and construction. However, construction has its own rules.

CONSTRUCTION 

Construction has two criterions. If it’s general construction, which falls under North American Industry Classification System (NAICS) 236, you have to self-perform 15% of the work. If it’s specialty construction, which falls under NAICS 238, then 25% of the work is what you have to perform. Specialty trades are air conditioning, electrical, plumbing, etc.

On the other hand, there is general construction or the overall contractor. When you’re given a big project by the government, which has a lot of components, it falls under NAICS 235. This means you only need to complete 15% of the work. In this case, you could sub out the majority of the work.

FIND OUT MORE

As long as you follow these rules and abide by the section that applies to you, you are in the clear.

For complete visual representations and examples on how these percentages can be legally broken down, refer to the video below.

To find out more about government contracting, visit the GOVCON GIANTS YouTube page.

Similarly Situated Entities: The New Rule to Help You Meet the Limitations on Subcontracting!

Posted on by Eric Coffie

Starting out as a small business, but can’t meet the percentage of work? Read this article to learn more about similarly situated entities, the new rule to help you meet the limitations on subcontracting!

SIMILAR SITUATED ENTITIES

The latest class deviation issue, DARS Tracking Number 2019-O0003, about similarly situated entities on January 8, 2018 has created rules that favor the little guys in the federal marketplace. 

With this new rule, contractors can now meet their subcontracting percentage goals by utilizing what the government terms as a “similarly situated entity.”

A “similarly situated entity” means a first-tier subcontractor, including an independent contractor, that has the same small business program status as you are. 

Previously, your only option was to self-perform the entire percentage goal of your contract or not accept the contract at all. But with this new rule, you can now meet that performance goal with the help of a firm similar to your small business size. 

For instance, if you are on a contract as an 8a business, then you can bring in another 8a firm to help you meet your 50% requirement while you subcontract the other 50% to others. 

Note: If the project is a set-aside, the respective firm must have the same set-aside to deem you eligible for satisfaction of the requirements.

“So, this is great news for small businesses out there because a lot of times people are just getting started and you may not have everything that you need to get the wheels turning, so… the government is creating rules, policies to allow small businesses to really embark on this journey. So, they’re making it more favorable for the little guys to get started and to start growing their business.”

RESOURCES

So, for those firms that may find it difficult to fully staff up the job on a large contract, then this is an effective alternative that is now being accepted at the federal level.

However, if you can meet the percentage requirement, then this rule does not impact your firm at all. You can still self perform all of your respective prime contracting work within your ability.

With this in mind, if you want to learn more about certain federal contracting rules or how to navigate the federal marketplace overall, then check the resources below. 

You can also join us here at GovCon Giants or check the new GovCon Edu where you learn everything about government contracting!

Similarly Situated Entity helps Limitations on SUBCONTRACTING for small firms 

https://www.youtube.com/watch?v=8-4Lml2bZj4&t=132s

Explaining the rules for subcontracting small business contracts

https://www.youtube.com/watch?v=ajwQiCAS1No