Sales Strategy

Bidding as a Prime Contractor

Subject: Sales Strategy, Small Business, Prime Contractor, Request For Quote (RFP), Selling, Decision Making

By Victor Antonio

I once had a request for quote (RFQ) that came in for a high-end systems solution for a major cable TV operator in Alaska.  After reviewing the specification we knew we could do about 70% of the requirements.  We weren’t worried about the remaining 30% because we had other vendors who could supply us with the remaining requirements. 

There was one small problem though; we weren’t classified as a Small Business by this company’s standard.   This company required that a company have less than 750 employees in order to be classified as a small business.  We were stuck.

John, one of the vendors then came up with a relatively simple idea.  John suggested that the bid be submitted under his company name since his business only had 45 people and fell well within the small business category.

I didn’t quite get this so I asked John how it would work.  He went on to explain that his company would submit the final RFQ bid as the Prime Contractor and that the remaining business would be sub-contracted to us. 

Here are the logistics on how we made this work:

1)    We sent John the RFQ

2)    After reviewing the RFQ, we sent John’s company a quote for our products and services.  In other words, as a subcontractor we were submitted a “mini-RFQ” if you will to his company.

John would then turn around and add our quote to his overall quote which he would then submit.  I wasn’t sure if this could be done, but nowhere in the contract did it specify that:

1)    You couldn’t have multiple contractors bidding and,

2)    That the majority of the work had to be done by the Small Business

Let me elaborate on the second item.  If John’s company was going to be the prime contractor with only 30% of the work, my concern was that the bid would be rejected since I ASSUMED that the small business should do the majority of the work. 

But again, nowhere in the RFQ was there any statement or clause on what percentage of the work had to be done by the Prime Contractor. 

To make a long story short, we went ahead and submitted the RFQ bid but we didn’t win.  Nonetheless, I did learn a valuable sale’s strategy; one I hope you will keep in mind when considering partnering with someone on a bid in the future. 

Remember, there’s more than one way to skin an RFQ.