The Obama administration’s push over the last eight years to inject more competition into the federal procurement process seems to have resulted in two major changes across the vendor community that are only now becoming clear.
First, the incumbent win rate dramatically dropped over the last year.
Second, contractors diversified into other markets, including state and local and commercial sectors, at a more aggressive rate than in the recent past to deal with the shrinking federal procurement pie.
“This gives a strong indication that competition is increasing and possibly driving down pricing and profit percentages on federal contracts,” stated the 2016 federal contractor survey sponsored by Grant Thornton released on May 30. “Companies should be looking at their current pricing techniques to determine if adjustments are necessary to win greater percentages of proposals.”