How to Price Government Contracts Without Losing Profit

Federal buyers don’t always choose the lowest price—they’re often looking for the best value. Alongside cost, they weigh:

• Past performance

• Technical approach

• Compliance with requirements

• Ability to deliver

📌 Tip: Always read the RFP carefully—some are cost-driven, while others balance quality and technical expertise.

Before setting your price, calculate:

• Direct costs: labor, materials, subcontractors

• Indirect costs: insurance, admin, technology, office overhead

• Profit margin: target 8–15% depending on industry norms

💡 Pro Tip: Use a system like DealMaker Call Journal to collect subcontractor quotes and keep your numbers consistent across bids.

• Check SAM.gov and FPDS.gov for awarded contracts in your NAICS code.

• Study unit prices and trends in your field.

• Avoid undercutting too far—agencies may reject bids they see as unsustainable.

• Tiered pricing: Offer scalable levels of service.

• Bundled solutions: Combine multiple requirements to increase value.

• Value justification: Explain how your approach saves money long-term (fewer delays, compliance, efficiency).

• Build in a contingency buffer for unexpected costs.

• Negotiate better subcontractor rates using tools like the BidBanter Toolkit.

• Don’t fall into the trap of “winning at any cost.”

One of our Weekend Warrior Bootcamp students underbid their first project and nearly broke even. After learning our pricing system, they adjusted their approach and secured their next contract with a $15K profit on the very first award.

Winning contracts is exciting—but winning with profit is what builds a sustainable GovCon business. By understanding costs, researching competitors, and applying smart strategies, you can bid confidently and profitably.

👉 Ready to learn step-by-step how to do this for your business?

Join the Weekend Warrior Bootcamp and master the skills to price, bid, and win profitably.

[➡️ Click here to join the Bootcamp]