FLGOVCON69- GovCon Cost and Pricing

In this episode Jenny Clark talks about GovCon Cost and Pricing.

How do you determine your Cost and Pricing

Balancing Competitive Pricing with Profitability

DOES YOUR PROFIT AND LOSS LOOK LIKE THIS?

REVENUE:

Usually Monthly Billings

DIRECT COSTS (AKA Billable Costs)

Direct Labor of Employees Working on Contracts

Direct Travel for trips taken for contract purposes

INDIRECT COSTS (Support Costs, Shared Costs, “Overhead”)

Fringe (Payroll Taxes, Leave, Benefits)

Overhead (Support cost for technical workforce)

General and Administrative (Corporate)

UNALLOWABLE

Interest, Entertainment, Advertising, Sponsorships, etc

If it doesn’t, then I cannot compute your indirect rates, and you will NOT PASS a DCAA Audit.

Solvability RPM (Rate & Pricing Model)

Profit and Loss Statement – Budget and Forecast

Revenue – What You Know You Can Count On
Direct Labor Costs – Assume Your Current Billable Headcount Continues
Direct NonLabor Costs – Travel, Subs – base on history
Indirect Labor Costs – Leave, Overhead Labor, G&A Labor (Corporate), Business Development Labor, Bid & Proposal Labor
Indirect Rates Should be Computed from your Profit and Loss

Solvability RPM (Rate & Pricing Model)

RPM Worksheets for Forecasting and Tracking

If Bill Rate is $100 Per Hour, what should the employee pay rate be?

If Employee Pay Rate is $50 Per Hour, what should the billing rate be?

Ask Yourself!!

What would it mean to KNOW where you are making money?

How would accurate information help you win more contracts and grow faster and more profitably?

How would you invest in your company and yourself if you had more cash flow?

What risk are you taking by NOT having the right answers?

Why should you be doing this all ALONE?

Do You Know What Your Wrap Rate is and what it needs to be?

Download our Free Wrap Rate Calculator

wraprate.solvability.com

E-mail me: jwclark@solvability.com

To contact Jenny W Clark

CEO, Solvability, Inc

www.solvability.com

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