How to Team
Teaming-up with other contractors
Greetings Folks 👋
Today, we will cover an essential concept for new contractors. If you're starting, you’ll want to read this.
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Teaming is where two or more contractors form a partnership and work on a contract together.
The FAR 9.601 describes it as such:
For description's sake, both arrangements, as listed above, are different types of contract completion models.
A joint venture is when two companies join as a corporate entity to complete a contract. After the contract is completed, they separate.
The prime contractor is the term used to identify who is ultimately responsible for contract execution. This happens when one company is given full responsibility for the project. Subcontractors typically work under a prime contractor to complete specific work that the prime contractor has contracted with them. The subs have a statement of work agreed upon by the prime that lists precisely what they are expected to do. Final decisions and work execution are the ultimate responsibility of the prime, even if the sub does not complete their part.
This is why being a prime vendor can be a headache; the prime is responsible for everything.
When does it start?
When new, you should team with primes in your region before attempting to bid on contracts.
As a new contractor, you may not know how to navigate the regulations and red tape, submit or write bids, or ask questions. Therefore, finding someone with experience and pitching a partnership with them makes the most logical sense.
How do you do this?
If you have researched correctly and understand what you want to sell, follow the steps below.
Search sam.gov and FDPS for the NAISC and PSC codes that match what you want to sell to the government.
Pull a list of historical contracts in your region for the past 3-5 years
List every company awarded as a prime for those contracts. (Add to your CRM)
You should have a list of 15 - 30 companies.
Now, you will contact these companies, set up meetings, introduce yourself, and find where your offer/service aligns with their ability to execute current and future contracts.
It is perfectly normal to drop in at their office location for an introduction if they are non-responsive.
Look for government contracting groups and organizations in your area. Some specific ones to look into:
Procurement Technical Assistance Centers (now called APEX Accelerators)
Search for local Facebook groups and organizations in your area. Some can be state-specific.
This process will take you many weeks. The recommendation is to use a CRM, keep every contact you can find, and repeatedly reach out to these companies until you get your foot in the door.
So why team?
Teaming determines your ability to both win and, yes, lose.
The point of teaming is to bridge skill and ability by utilizing different strengths within the formed partnership. It can be used to do something technically challenging or to fill strategic gaps where expertise is lacking.
Large businesses often hire smaller businesses to meet SBA goals set in the initial RFP. Even the main DoD contractors do this. A business will be disqualified from the contract if it does not meet all the RFP requirements. This creates an interesting situation because, in regular industry, the best small businesses are selected based on job performance. However, in the government, small businesses can be selected because of the certifications required to win the contract (HUB Zone, Female owned, Vet owned, etc). If those small businesses cannot fulfill the work but are selected based on SBA goals, it can cause issues after the contract work starts.
Many small businesses never have a prime contract. Instead, they find larger businesses and offer their expertise to help the prime win. This lowers their risk profile, allows them to get government work experience, and allows them to participate in lucrative government contracts. This strategy also allows small businesses to dedicate resources directly to an active contract instead of the contract bidding process.
A word of caution: If a small business latches onto the wrong prime, it can determine its future performance history. If the contract goes wrong, that will result in a negative work history with the government and may disqualify you for future contracts.
Studying the work history and reputation of any company you want to partner with is essential. Ask for references and information on work performance.
Remember, whoever you partner with, you need to ensure a good relationship. Everything in the government operates from 20-30% relationships at a minimum, and teaming is no different.
If you are a small business new to contracting, it is highly recommended that you focus your efforts on partnering and teaming rather than worrying about spending your resources on bidding on individual contracts.
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