How to Price a Government Contract

Price is scored, audited, and — on fixed price work — irreversible. A defensible price is built from documented estimating assumptions, not from a target margin.

Step 1
Start from contract type risk
Firm-fixed-price puts every cost overrun on you; cost reimbursement requires an adequate accounting system. Choose your risk contingency based on the type, not on habit.
Step 2
Build the wrap rate honestly
Layer fringe, overhead, G&A, and fee onto direct labor using your actual pools and bases. A rate you cannot support in an audit is a liability, not a win strategy.
Step 3
Escalate the out-years
Multi-year efforts need documented escalation for labor and materials. Under-escalating buys year one and loses money in year four.
Step 4
Write the basis of estimate
For each element, state the source: historical actuals, vendor quote, or engineering judgment with rationale. Evaluators score realism, and unsupported numbers read as risk.

Checklist

Contract type risk priced explicitly
Indirect rates traceable to accounting records
Escalation applied to all option years
Basis of estimate written for every element

FAQ

How long does pricing a government bid usually take?

Plan for two to four weeks the first time and a few days once your Company Brain holds reusable content, past performance citations, and compliance language.

Can RFP Scribe do this for me?

Yes. Upload the solicitation, pick a Company Brain profile, and RFP Scribe drafts a compliant response mapped to every requirement, with citations back to your source material.