Financial Modeling and Cost Containment Strategies

If you have a written RFP, it probably included instructions on how develop, format, and display the pricing and contractual details. If not, how you format your pricing is up to you. If you are looking for a little guidance to get started, consider the various types of contracts. Each has a different way of accounting for costs, fees, and profits. Always remember, the final judge of whether you have presented your pricing properly is your customer. Consider how they will want to pay for what you are proposing.

Most important in developing winning cost proposals is understanding that the Government has moved away from “maximized competition and lowest responsible, responsive pricing” to “Best Value Procurements.” Best Value is a gray area that is open to subjectivity. The term's "best value" and "lowest overall cost alternative" are not mutually exclusive. A best value analysis lends itself to determining the "lowest cost alternative." Best value procurements involve tradeoffs between cost and technical. Remember, there is not any legal requirement that the procuring government agency quantify any cost/technical tradeoffs in dollars. An agency can use whatever evaluation approach (e.g., narrative, quantification) that best suits its needs, while at the same time being sensitive to the streamlined nature of the Federal Supply Service process. For example, agencies can use narrative explanations or its cost/technical tradeoff, so long as the evaluation is reasonable and consistent with the criteria identified in the RFQ.

Pro-Methods understands the current market place and can assist you in developing Excel-based decision support tools that will allow you to evaluate the tradeoffs required to formulate winning cost proposals. Pro-Methods can provide you cost model templates that you can use in developing your business proposal. Pro-Methods can also assist you in developing specialized models for specific proposal situations that provide extensive decision support capabilities. We believe that winning cost proposals are achieved when all cost tradeoffs possible, as offered by the technical solution, are considered. We believe that a winning proposal integrates the technical and cost solutions.

Contact us now and let us put our experience in developing business proposals to work for you. We will be happy to discuss your requirements and show you how we can specifically assist you in developing a winning business proposal.