Use Pipeline Criteria to Find the Best Federal Contracting Opportunities

The government has an annual goal to award 23% of all eligible prime contracts to small businesses. This is good news because that means you have a lot of opportunities. The bad news is that you don’t have the time to filter through each opportunity properly to qualify it. The best way to expedite finding federal contracting opportunities for your small business is to set clear selection criteria.

How Do Pipeline Criteria Help You Bid Better?

Pre-established pipeline criteria for choosing government contract bid opportunities helps you focus on growth now, and into the future. You should take time to brainstorm and document these criteria in a running document for anyone who participates in your business development efforts. It keeps everyone on the same page, literally and figuratively. The number of opportunities for federal contractors is staggering. So you need to narrow down the field to a handful of real ones that you have a chance of winning and that fit your company like a glove. For example, it really helps knowing right away whether an opportunity:

  • Is too big or too small
  • Has too much competition
  • Has requirements that disqualify you out of the gate
  • Involves work you’re not interested in or can’t perform
  • Takes place in a location that would make it hard for you to qualify for or to manage the program, and so on.

Setting your own qualifying and disqualifying criteria brings the number of government opportunities you consider down to something manageable. After that, you can invest resources (time and money) to qualify them, and start your capture effort.  Although a list of criteria can get lengthy, let’s take a look at the top 7 criteria you can use to screen opportunities for your pipeline.

Do You Have the Capability and Past Performance?

Assessing whether you have the capability is a no-brainer as the first step. Look at your services or products as your core competencies for your search keywords. Search databases may group your ideal opportunities under certain markets or industries. We recommend keeping your keywords and related information in a Word document that you continuously update.

In terms of your past performance, you need to know whether you have a related set of projects that would fit this opportunity. If you haven’t already, you’ll want to create a past performance library. A past performance library is not merely a spreadsheet with a series of one-liners in it (although we have seen some companies that don’t even have that on hand).

At the very least, every time you submit a proposal or response to a Request for Information (RFI), you should copy that past performance description into a past performance references repository.

When you open your past performance library, you should see the most up-to-date information. To keep your past performance information flexible, you could create your library in a OneNote or similar file type that your team can access and collaborate on.

Additionally, note whether you have only prime or subcontractor past performance in your search criteria list. If you are not priming yet, not having prime past performance may be one of the disqualifying factors.

Is the Work at a Target Agency or Do You Already Know the Customer?

In most cases, you have to pick which agencies to target so that you aren’t spread thin. Your past performance at the same agency will likely have more weight than past performance in another agency. When you stack more past performances at the same agency you build a stronger offering. On the other hand, only doing a project here and there keeps you scattered and weak.

You should look for opportunities at agencies where you have past performance first. If your options are scarce, then you may consider agencies you could target based on your past performance with similar agencies. For example, if you have past performance with the VA, then the Defense Health Agency may not be a huge leap.

You may also want to consider whether you know this customer. Does this customer know you?

Have you made a point to meet with them one-on-one or attend their events and make your face and company known?

Have you submitted good white papers or point papers to interest them in your thought leadership and offerings?

Alternatively, learning about an opportunity a couple of years in advance can help you execute a great capture strategy if the customer doesn’t know you yet. You may have time to build the relationship.

Think of it in terms of a long game – you should have opportunities to bid on now, 6 months from now, a year from now, two years, three years, and so on. So, if an opportunity is a good fit, you should get to know the customer while they are still willing to talk to you. The bidding process will approach quickly and they won’t be as willing to speak with you.

Is it a Small Business Set Aside or in a Specific Socioeconomic Category?

As a small business, you may not have the same resources as a large company. They have dedicated business development personnel or entire departments. Their only job is to generate new business for their company. So look for opportunities where you have some sort of built-in advantage, such as being a small business. Until you have built up your business development capability, you may want to limit your searches to small business set-asides. You have a chance to compete for restricted opportunities if your small business has any socioeconomic designations, such as:

  • 8(a) or super-8(a)
  • Woman Owned Small Business (WOSB) or Economically Disadvantaged Woman Owned Small Business (EDWOSB)
  • Service Disabled Veteran Owned Small Business (SDVOSB)
  • HUBZone

Less competition means you have a better opportunity to stand out among your competitors. Limiting your searches to the socioeconomic category you belong to means you’ll have fewer opportunities to sift through.

If We’re Are Planning to Bid on Opportunity as the Sub, Is the Potential Prime a Large or Mid-Tier Company?

As a small business, it’s in your best interest to consider partnering opportunities. It gives you a chance to build past performance, while not having to shoulder proposal management duties that can get time-consuming and expensive. However, you may be hesitant to partner with another struggling small business.

It’s to your advantage to know how well-financed they are. If they struggle with their cash flow, like many newer small businesses, they are likely to take care of their own payroll first, and their partners last. Financial headaches tend to roll downhill. Be certain they have enough cash they can tap into when you decide to team with them, such as an unused line of credit. High integrity and willingness to play ball are important characteristics too.

Alternatively, you can avoid many headaches by primarily partnering with mid to large-sized companies, and checking their PayDex Score at Dun & Bradstreet. A company’s PayDex score tells you how long it takes them to pay their vendor bills on average. Investing in a business credit report can go a long way in preventing headaches later.

Is the Bid Opportunity Under ‘X’ Million Dollars?

When you are small, you can only pursue certain sized contracts and have a high likelihood of winning. Your business can only stretch so much and still look credible in the eyes of the government as a prime contractor. You should only go after opportunities that are two to three times bigger than your biggest current opportunity. You may find bigger opportunities when looking at Indefinite Delivery opportunities, but your government customer will consider your risk when it comes time to award.

If your largest past performance project is $1 million, it may not qualify you for priming a $20 million project. The largest single award project you could go for is probably $5 million. Limiting your searches for appropriately sized projects helps you prioritize your scarce resources, and target winnable opportunities. If you are bidding on an Indefinite Delivery/Indefinite Quantity (IDIQ) opportunity, the ceiling value can be much larger However, you must consider the size of the Task Orders under that opportunity.

Additionally, as a prime, the government wants to make sure you have the financial capacity to handle a team of subcontractors. This means having the revenue and infrastructure in place to manage your team and help them perform financially and otherwise. Your customer doesn’t want to set up a situation where your subs are not getting paid, as we mentioned in the previous point.

When stretching, you’ll have to prove you have deep pockets and a large line of credit, as well as proper management mechanisms in place. The larger the project, the bigger the burden of proof is that you can handle the responsibility.

Is the Opportunity On Your Preferred Indefinite Delivery Vehicle (IDV)?

You may be prime or sub on a multiple award IDV. You could make this a criterion because every single IDV needs its own pipeline. Some of these opportunities should become your priorities if the IDV you are on has limited competition. Alternatively, disqualify any opportunities upfront if they are part of an IDV to which you don’t have access.

If you’d like to learn more about competing on IDV’s and winning task order awards, click here to review our Winning Indefinite Delivery (IDIQ) and Task Order Proposals course.

Facility Clearance, Yes or No?

You waste your scarce time entertaining opportunities that you don’t meet the requirements for. Search for the word “clearance” in the related opportunity documents to ensure you don’t miss it in your excitement, when an opportunity feels like a great fit.

If an opportunity requires facility clearance, and you don’t have it and can’t be sponsored as part of the contract, don’t look at those opportunities. Or maybe you have someone who can sponsor your clearance. Then, by all means, look at those opportunities as a way to get this valuable credential.

Other Opportunity Screening Criteria to Consider

Think about what sort of work you don’t want to touch. As a small government contracting company trying to make it and survive, the joke is that you’ll take anything that the customer will pay you for, as long as you have cash flowing in. And that may be true, up to a point.

The sooner you can start to mold your company into core areas of specialization, the better. The decisions you make now will reflect on your company in the future. You may want to think hard about whether to jump at IT opportunities today, and clerical support tomorrow.

What about a perfect location? For example, is anywhere in the United States okay, or do you only want to work locally where you can walk in and talk to the customer? The advantage to staying close by is that you build your footprint at the agency more easily, and you don’t have to buy a ticket each time you need to have a conversation.

Remote recruitment is a viable possibility, but you’ll need to put the infrastructure in place to pull that off as well. Consider the cost of travel and investing in more robust human resource management solutions, and whether that cost is something you can bear at this juncture.

Pipeline Criteria Makes Your Opportunity Search Efficient

Creating criteria for potential pipeline opportunities helps you filter through thousands of opportunities for the ones that fit your company best. The criteria you choose should help you select the opportunities that you have the best chance at winning. These criteria will help point you to opportunities use of your non-billable time best. When you focus on the opportunities that best suit your company’s size and skill sets, you increase your chances of winning government contracts.

If setting these sorts of criteria, and other methods for filling your pipeline is something you know your business needs to succeed, then be sure to check out our Foundations of Federal Business Development course. This course offers essential BD skills to help you grow your company.

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