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Harris

How much should I markup on governent purchase order rfqs

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Hello:

I have recently been certified as a Hubzone business in the state of Virginia (in the DC Metro area). We specialize in IT services and support. I have been recently bidding on purchase orders for licensing software and computer hardware equipment, however I had a few questions, since I have not been awarded any so far:

What is a good markup percentage? I have heard 10%-20% is good.

Will my Hubzone 10% price preference be considered?

Does the government accept quotes that are on a template my company uses? Or does every bid have to be submitted with the SF-1449 form?

How long does the awarding process take? 

How are you notified that you have won the bid?

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5 hours ago, Harris said:

Hello:

I have recently been certified as a Hubzone business in the state of Virginia (in the DC Metro area). We specialize in IT services and support. I have been recently bidding on purchase orders for licensing software and computer hardware equipment, however I had a few questions, since I have not been awarded any so far:

What is a good markup percentage? I have heard 10%-20% is good.

Will my Hubzone 10% price preference be considered?

Does the government accept quotes that are on a template my company uses? Or does every bid have to be submitted with the SF-1449 form?

How long does the awarding process take? 

How are you notified that you have won the bid?

Congratulations!  Your questions have lots of details behind them.   Here is my best attempt to give the 30,000 foot overview answers.  

Markup?   The simple answer is what the competitive government market will bare.  More detailed - do you have experience in the market place that suggests what competitive markup might be?   What is usual with your company?   Are your accounting processes such that you can support that your markup is reasonable and where you might be able to "give a little" for the sake of winning in a competition?   The government has no specific standard as to what is reasonable for markup but individual agencies and CO's might adopt their own.  To not make it too complicated if competition is based on price alone evaluation by the government is different than if they are doing it based on price/cost and other factors.   Want to get detailed.   Read FAR Part 15 and if several more questions are raised in your own mind consider taking a class on Cost/Pricing of Federal contracts.   The WIFCON home page that carries advertisement from training firms might get you started in the right direction.  An additional thought is that you might consider getting some assistance from your local Procurement Technical Assistance Center (look up "APTAC") on the web they may be able to provide you with training opportunities or even more detailed assistance on this and your other questions as well.  Most of the time it is free assistance.

HUBZone price preference? I suggest a read of FAR 19.13 to understand where the price preference comes into play.   You can find it here - https://www.acquisition.gov/content/part-19-small-business-programs

Your template or the SF-1449?  Most likely the SF-1449 in almost all cases.   An agency can tailor their provisions to mirror the commercial marketplace but I have seen it rarely done where the vendors template completely replaces the SF-1449.   Others may be able to relate other experiences.

Time to award?  Again it depends.  If competition is based on price alone, usually fast, if price and other factors longer.   Magnitude, complexity and other factors  of the need dictates how the agency might decide to evaluate to arrive at an award decision.  Procurement Action Lead Time (PALT) estimates  varies by agency.   Here is an example that might help you understand better - https://dodprocurementtoolbox.com/site-pages/palt

Notified? In writing by letter with awarded contract usually.

I hope this helps you get started on your questions.

 

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