When a government entity determines a need for a particular product or service, it will often work with the public sector to find a provider. Those businesses will compete to win a government contract to provide that product or service.
If your government contracting firm is seeking to grow its sales to the public sector, you need to learn everything you need to know about government contract awards.
What is a Government Contract Award?
Simply put, a government contract award is the amount of money the government has agreed to pay the contractor for its goods or services, along with the other stipulations of the contract agreement.
Government organizations often work with private providers of goods and services to meet their needs through government contracts. This is often a competitive process that results in a government contract award.
When the government is ready to formally seek vendors to provide goods or services, it will release a bid, RFP, or contract opportunity in one of several forms.
Usually, these types of government bids fall into one of two categories: fixed price and cost-reimbursement.
The contract type defines the expectations, obligations, incentives, and rewards for both the government and the contractor during an acquisition. The winning bidder (or bidders) on this contract will become the recipient of a government contract award, a formal agreement between the parties that sets out the obligations of the contract.
Government contract awards are given to companies during the Capture Planning and Award stage of the government contracting lifecycle.
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Types of Government Contract Awards
Federal awards most commonly come from two government contract types: fixed-price contracts and cost-reimbursement contracts.
- Fixed-price contracts are used by all U.S. federal governments and by many other types of government. These contracts generally provide a single set, although an adjustable price level may sometimes be preferred. Fixed-price contracts are typically the method used when the contract risk is relatively low, and the contractor and the government are likely to come to an agreement on the maximum price.
- Cost-reimbursement contracts, also known as cost-plus contracts, are agreements in which a contractor is reimbursed for all allowable expenses, plus an additional amount that allows the contractor to profit.
Two other, somewhat less common types of government contract award are IDIQ (indefinite delivery/indefinite quantity) contracts and time and materials contracts.
Small Business Government Contract Awards
Governments are required to set aside a set amount of their procurement dollars for qualifying small businesses. Other opportunities for a small business to get government contracts include serving as a subcontractor on a larger government contract or entering into a teaming agreement with one or more other government contractors.
Below is a list of various types of government contract awards specifically designed for small businesses. These contract opportunities are relevant for different sub-categories of small businesses.
Women-Owned Small Business Federal Contracts
The government aims to award at least 5% of federal contracting dollars to women-owned small businesses every year.
Service-Disabled Veteran-Owned Small Business Contracts
The government aims to award at least 3% of federal contracting dollars to SDVOSB firms every year.
8(a) Business Development Contracts
The government aims to award at least 5% of federal contracting dollars to qualified small disadvantaged businesses every year through the 8(a) program.
HUBZone Government Contracts
The government aims to award at least 3% of federal contracting dollars to HUBZone-certified small businesses every year.
A HUBZone is a historically underutilized business zone where the government is looking to foster economic activity, such as job creation. Among the small business programs, it is the only one not focused on business ownership, but rather on the location of the business and its employees.
Other Small Business Government Contracts
State, local, and education governments, as well as Canadian governments, offer their own programs to help small businesses find and win more government contract awards.
Contact the agency you are interested in doing business with to find out which opportunities are set aside specifically for small businesses.
Steps to Take to Get a Government Contract Award
As the government market has grown, diversification has become a necessary part of many government contractors’ portfolios. Whether that's branching out to pursue new opportunities in a different industry or working with a new government entity, it can be challenging to secure a new government contrac.
In order to make the jump from identifying an opportunity to putting together a quality proposal, and ultimately actually winning a government contract award, contractors must go through several steps.
This starts with deciding whether to submit a bid on the government contract, and continues through the actual awarding of the contract.
- Make an effective bid/no-bid decision on whether to pursue the opportunity
- Research and influence the opportunity
- Develop a sound strategy to help you surpass your competition
- Conduct a competitive analysis of the opportunity
- Assemble a winning and diversified team
- Perform price to win analysis
What Happens After the Government Contract is Awarded?
If your business wins a government contract award, the next step is to deliver the service or provide the product. If your company did not win, the Contracting Officer (CO) is required to notify your company either orally or through a written statement within a reasonable amount of time.
The CO must also debrief all bidders, outlining the number of proposals received, the names of the firms that submitted proposals, and further explanation of how the contract decision was made. It is in the contractor's best interest to always attend the debriefing, whether or not the contract has been won. It offers a chance to get a leg up on the competition the next time around and can strengthen future proposals by identifying where the proposal went astray or why the contract was lost.
Where Can I Find a List of Government Contract Awards?
The US Federal Government shares its award information on its SAM.gov website, which replaced the older FedBizOpps site. Many reports on federal government acquisition awards are available to the public, along with many government bids, RFPs, and contract vehicles.
The Federal Government of Canada’s online procurement services have transitioned to a new website entitled CanadaBuys, replacing the former Buyandsell portal. Notices of procurement opportunities are posted to CanadaBuys, which is now the designated website for all Canadian federal tenders and contract awards.
At the SLED (state, local, and education) level of government in the U.S., individual governments will often post their government contract awards on their own websites. The same holds true for Canadian territorial, provincial, and MASH (municipalities, academic institutions, schools, and hospitals) governments.
The best single place to find government contract awards from all types of government is GovWin IQ, which centralizes government contract awards from U.S. federal, state, and local government entities, as well as Canadian government entities.
This market intelligence platform contains a comprehensive list of government contract awards from governments purchasing a wide range of products and services. More than 5,500 companies rely on GovWin IQ for the latest and most comprehensive information solutions, including market intelligence, sales management tools, teaming solutions, networking opportunities, and educational events.
