No subcontracts means no opportunities to expand, grow or expand your company’s portfolio of work. And it’s not just subcontracting in general that is important-you want to be sure you’re doing subcontracting in the right way in order to get the maximum benefit out of it. We’ll explore what you need to focus on in order to maximize your subcontracting efforts and ensure success!
What is subcontracting? How does subcontracting work? What are the benefits of subcontracting? These questions and more will be answered in this blog post. Subcontracting is a key component to most government contracting efforts, but it can be difficult to understand what subcontracts are or how they work. This article will help you get started by explaining what subcontracting is, where subcontracts come from, and why subcontractors are important for your business.
It’s time to take charge of your future with these 6 steps!
1) Establish who you want to reach out to; 2) Develop a strategy that highlights the value of your company; 3) Understand the legal aspects of subcontractor relationships; 4) Create a clear plan for marketing and business development; 5) Build a pipeline of subcontracting opportunities; 6) Manage the subcontracting process.
When it comes to subcontracting, it’s important to remember that not all subcontracts are created equal. There are several different types of subcontracts, and each type has its own benefits and drawbacks. In order to make subcontracting an effective strategy for your company, you need to understand which subcontracts are right for your business and how to engage subcontractors in the way that will get the most benefit out of subcontracting efforts.
The government requires prime contractors agree with subcontractor’s subcontractor’s subcontractor’s subcontractor (you get the idea)-that each subcontractor in the chain is technically capable of performing the work. But subcontracting can be a complex process, and prime contractors need to be careful not to get bogged down in bureaucracy. This article provides tips on how to subcontract effectively while avoiding common pitfalls.
Why communicating quantifiable value is critical to prime and subcontracting efforts
Every subcontractor is in need of subcontracting opportunities, and subcontractors looking for subcontracting opportunities must know how to communicate the value they can provide to prime contractors. Prime contractors often subcontract out small portions or portions of projects because it can be cost prohibitive for them to staff and complete a project by themselves.
Communicating this value is critical because subcontractors must convince prime contractors that their resources and expertise are worth more than the subcontract price they ask for.
It may seem that subcontractors should just try to get as much work as possible from subcontracts but there is a lot of competition among subcontractors. To successfully compete with other subcontractors, subcontractors need to stand out by telling prime contractors about who they are, how they are different from other subcontractors, and what value they can bring to the prime contractor. A subcontractor has to be able to say no subcontractor can do what they can.
How to position your company in the market
In today’s competitive government marketplace, subcontractors can no longer depend on a “build it and they will come” strategy. Government subcontractors must take an active role in positioning themselves in the market to secure prime subcontracting opportunities. It is critical that subcontractors engage their customers, identify key decision makers within those customers, and stay abreast of changes in order to provide value-added services or products designed for specific customer needs.
In addition to this proactive approach, subcontractors need to maintain a pipeline of potential business by proactively identifying prospects before they have even thought about bidding on a project. Subcontractors should also track all bids received so as not miss important deadlines when responding with a proposal or bid response package.
How to engage the market
Once positioned in the market, subcontractors need to engage their customers. Establishing and maintaining relationships with key decision makers is critical to success. Subcontractors should determine what specific needs the customer has and identify how they can provide value-added services or products that meet those needs.
It is important to recognize that subcontracting is a long-term commitment between subcontractors and prime contractors. Subcontractors should never bid on projects unless they believe they can provide the most value and best solution for their customers, and be able to perform under any contract requirements.
It is also important to remember subcontractor’s role in government contracting. They are not building the end product; subcontractors provide value-added subcontracts that, when combined with other subcontracts create the end product.
How to build and manage your pipeline
Creating a strong subcontracting plan will help you identify opportunities, prioritize your efforts, and determine how many resources should be allocated for each approach. The subcontracting plan should identify the types of customers you want to do business with, the products and services you offer, how you will identify potential customers, and how you will pursue opportunities.
The plan should also identify what criteria subcontractors will use when selecting prime contractors. It is important to remember that subcontractors are not always the lowest bidder and that being the lowest bidder is not always the best way to win business.
In order to manage the subcontracting pipeline, subcontractors need to track all bids received and all prime contracts awarded. This information will allow subcontractors to determine what products and services they should offer, which customers they should pursue, and when they should bid on projects.
How to manage your Bid – No Bid process
In order to manage the subcontracting pipeline, subcontractors need to track all bids received and all prime contracts awarded. This information will allow subcontractors to determine what products and services they should offer, which customers they should pursue, and when they should bid on projects.
In order to maintain an organized Bid – No Bid process, subcontractors must ensure that their system is robust enough for tracking purposes. One way subcontractors can do this is by setting up a spreadsheet or database with columns for: customer name; date of bid; project description; product or service offered (including any special requirements); price quote; company contact person; company contact email address; decision maker contact information (name and phone number) at customer; subcontractor contact information (name and phone number); subcontractor email address; subcontractor Fax number; subcontractor bid submission date; subcontractor proposal submission date; subcontractor decision maker contact information (name, phone number, and email address); subcontractor price quote; subcontractor document tracking document number. Subcontractors should then use this spreadsheet when submitting bids in order to ensure that subcontractors are not missing any important subcontracting opportunities.
In conclusion
If subcontractors can communicate quantifiable value to their customers, they are more likely to be able to prime and subcontract successfully. When subcontracting for government contracts it is important that subcontractors understand the role of a subcontractor in regards to building end products vs providing value-add services or products. To achieve this understanding, subcontractors should build an organized pipeline with strong contracting practices which allow them track all bids received and all prime contracts awarded. The Bid – No Bid process needs to be maintained by using systems that are robust enough for tracking purposes so as not miss any opportunities while maintaining transparency between customer relationships at hand. It’s also important to note how communication about why you’re doing business with someone may help your sales efforts overall – even if you don’t necessarily win subcontracting opportunities.
To learn more about how to build a strong government sales strategy, our friends at Govology have a webinar presented by Joshua Frank of RSM Federal. You can register for this course here, How to Build a Strong Government Sales Strategy – 8 Core Activities (2022 Update).