The federal contracting marketplace is evolving as agencies look for faster, more flexible ways to acquire innovative products and services.
Changes in procurement policy, growing use of alternative acquisition pathways, and increased interest in nontraditional contractors are creating opportunities for companies looking to enter or expand within the federal market.
In FPS Podcast #84, Todd Hatherly spoke with David Nieburg of Aprio about these changes and what contractors can do to better position themselves to compete.
Why is the federal contracting marketplace changing?
Federal procurement policies and priorities have shifted significantly over the past 12 to 18 months.
One area receiving increased attention is the preference for fixed-price and commercial solutions. While that preference has long existed within federal acquisition regulations, recent policy changes are placing greater emphasis on it and making other approaches more difficult to justify internally.
Agencies are also under pressure to move faster and get new capabilities into the hands of end users more efficiently. As a result, government buyers are increasingly using acquisition methods that provide alternatives to the traditional procurement process.
What new pathways are available to contractors?
Government buyers now have more ways to reach companies outside traditional contracting channels.
These can include:
- Other Transaction Authorities, or OTAs
- Commercial Solutions Openings, or CSOs
- Government and industry consortiums
- Accelerators
- Solutions marketplaces
- Other alternative acquisition mechanisms
For contractors, having access to multiple pathways can be a competitive advantage.
A government customer may already be familiar with a particular consortium, marketplace, or acquisition method. Making a solution available through that preferred channel can make it easier for the customer to work with the contractor.
The goal is flexibility. Contractors should look for ways to meet customers through the acquisition methods those customers already know and use.
Are there more opportunities for nontraditional contractors?
As federal priorities evolve, new companies are entering the government contracting marketplace and bringing technologies and capabilities agencies increasingly need.
Areas such as artificial intelligence, autonomous systems, drones, cybersecurity, and other advanced technologies are creating opportunities for smaller and more agile organizations.
Many of these businesses may not have decades of federal contracting experience or the extensive compliance infrastructure of established contractors, but they can often develop and deliver new capabilities quickly.
This creates opportunity, but it does not eliminate the importance of compliance.
Companies still need to understand the requirements associated with the opportunities they pursue. For organizations that are not yet prepared to pursue large contract vehicles directly, subcontracting can provide another path into the federal market with fewer administrative burdens.
What can contractors do to become more competitive?
Despite changes in procurement policy and acquisition methods, several fundamentals of government contracting remain the same.
1Build relationships and understand the mission
Success in federal contracting is still built on relationships.
Contractors should take advantage of industry days, customer engagement sessions, one-on-one meetings, and other opportunities to better understand an agency's mission and challenges.
The goal is to understand what the customer is trying to accomplish and show how your product or service can help.
Trust also matters. It may not appear as a scored requirement in an RFP, but customers still need confidence in the companies and solutions they recommend.
2Demonstrate your capabilities
When possible, contractors should give prospective customers an opportunity to see or experience their solution.
Demonstrations, prototypes, hands-on testing, and relevant past performance can help reduce the perceived risk associated with selecting a new product or contractor.
Being able to show how a solution works and where it has succeeded before can make it easier for a customer to understand its value.
3Follow the proposal requirements
Even as acquisition methods change, proposal compliance remains essential.
Contractors can lose opportunities simply because they fail to fully follow solicitation instructions or address the government's stated evaluation requirements.
Before focusing on persuasive messaging, contractors need to make sure they have addressed the basic requirements of the solicitation, including proposal instructions and evaluation criteria.
Once those requirements are covered, they can build a stronger story around how their solution supports the customer's mission.
What should contractors take away from these changes?
Federal acquisition may be evolving, but successful government contracting still requires a combination of market knowledge, customer understanding, compliance, and execution.
Contractors should pay attention to emerging acquisition pathways and look for ways to make it easier for agencies to access their products and services.
The fundamentals still matter: build relationships, understand the mission, demonstrate value, and follow the solicitation requirements.
Companies that can combine those fundamentals with a flexible approach to acquisition will be better positioned to compete in the changing federal marketplace.
FPS would like to thank David Nieburg of Aprio for joining the FPS Podcast and sharing his insights on the evolving federal contracting marketplace, emerging acquisition pathways, and strategies contractors can use to better position themselves for future opportunities.
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