Teaming is a way of life in the federal contracting sector. It’s a rare circumstance when one company can win a contract of any significant size by themselves (other than businesses that provide facility maintenance, support services, etc.). Almost all large contracts are done in a multiple fashion with large and small teammates.
According to this article at Inc., the American Express OPEN Victory in Procurement report found that “small business owners who paired up with other small firms or acted as subcontractors won 50 percent more contracts.” In this article, our focus is on your role as a subcontractor.
Your first step towards a successful team contract should be a lawyer’s office, legal website or your PTAC. They can help you create your own non-disclosure agreement (NDA). An NDA will protect you as you proceed through the contracting and identification process; it’s a promise that neither you nor the other party will disclose each other’s information outside of these teaming discussions.
Your next step is a teaming agreement, which generally consists of a whole lot of definitions, points of contact and boiler plate explanations (much of which are repeated from the NDA). At the core of the teaming agreement is what is called Exhibit A – this is where you define the responsibilities of the parties and, most importantly, how work will be allocated amongst the prime contractor and the subcontractor.
There are many ways you can divide work. The simplest is for the prime and sub to agree on a specific percentage share, recognizing that you can’t exactly split things down the middle because you can’t split a person.
It’s very important that Exhibit A specifically identify how you intend to do things, and the work you expect from your partner at every stage of the process. While you’re writing the proposal, who’s going to perform each of the functions? When it’s time to go out and market yourself, who’s going to do that? All of these are important considerations in this process.
Let’s assume that you’ve put yourself out there to various groups and networks and you’ve managed to find the right partner to team with as your prime contractor. Together, you put a proposal together and sent it off to the government, and lo and behold, the government awards the prime contractor the contract.
You’ll recall that piece of legislation that will give more power to the small business officers to enforce percentages that the primes have to give to their small business subs, and now you can see why this is so important. Too often there is a difference between what was promised and what was actually delivered (because, in the end, large businesses want appliances, they don’t want subcontractors). It is very important to get these details in writing, no matter how much you trust your partner. Even if your prime contractor is your relative – even if it’s your mother – get it in writing.
Partnering up with a larger business allows you to go after work that you wouldn’t be eligible for otherwise; you wouldn’t be able to bid on it. The large business needs you to fulfill their small business requirements. They also want certain things from you (customer knowledge, fast performance, functional capability). People like the nimbleness of small businesses – things can move faster without the huge overhead and complex procedures of larger organizations.
All this translates into another set of ways in which you can find customers and get to work.