The Importance of Proving Value for a Government Contract Award

I wrote a government marketing article last year about the many things that influence a government contract award – and how pricing isn’t everything. I’d like to bring this point up again because pricing tends to be a factor that many businesses focus on too much when time could be spent more wisely on building a case for company value.

An example of this is of a recent GIS contract that was awarded in late May. I read a press release that described why Timmons Group, a forerunner in engineering and geospatial services, received a government IDIQ contract award for a highly coveted GIS task order for IT services with Fairfax County, Virginia.

Here is an excerpt from the May 2007 press release found on www.directionsmag.com:

“Timmons Group was one of five firms to be awarded a contract in the GIS Skills area, based on proven capabilities and experience. The contract is active through December 2012, with the option to renew for up to three successive one-year periods. During the life of this contract, any Fairfax County department with a GIS-related need will work with the County IT Department to develop a task scope of work and obtain price proposals from the pre-qualified GIS vendors who offer relevant services. The County’s government contract awards will go to a vendor on the basis of best value, rather than lowest price. Furthermore, the contract includes a cooperative purchasing clause that entitles other public bodies to directly procure GIS professional services from Timmons Group by referencing this contract, if they choose to do so, without open competition. The firm’s Technology sector plans to see a significant amount of GIS services work come from Fairfax County and other local governments during the long life of this contract—potentially nine years.”

This example illustrates the importance that overall value plays in a government contract award – it’s clear that agencies are looking for companies that effectively demonstrate the quality, reliability and reputation of their services. This case is also a great example of why term contracts (sometimes known as indefinite-delivery indefinite-quantity, or IDIQ, contracts) are particularly desirable leads. The Timmons Group’s contract will provide solid work over the next 5 years…and the contract may be extended if the company secures a renewal! From a vendor standpoint, term and IDIQ contracts are a more ‘solid’ source of predictable revenue. By ‘predictable revenue,’ I mean that you can plan your sales around IDIQ contracts that are up for renewal. You can also get started on a more long-term revenue plan to generate profit for your company and allocate resources accordingly. With IDIQ contract data, you can even monitor your competition’s progress on an IDIQ contract to develop a strategy to capture that term contract revenue when the contract expires – and in the meantime, you can target current IDIQ contracts that are up for renewal. Even evaluating agency spending trends is simple with term and IDIQ contract information: by reviewing when term contracts surface, you can track patterns in agency spending and ramp up your marketing efforts accordingly. Find out about how your business can tap into term contract information.

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