How to Justify Increased Profit/Fee Under DoD Contracts Requiring Certified Cost or Price Data
Here Is What You Will Learn:
This presentation provides insight into DoD’s profit policies and how businesses can justify and negotiate higher profit or fee on DoD contracts and contract modifications that require the submission of certified cost or pricing data under Federal Acquisition Regulation (FAR) 15.403.
Defense Federal Acquisition Regulation Supplement (DFARS) 215.404-4(b)(1) requires DoD contracting officers to use a structured approach for developing a prenegotiation profit or fee objective on any negotiated contract action when certified cost or pricing data is obtained, except for cost-plus-award-fee (CPAF) contracts and contracts with Federally Funded Research and Development Centers (FFRDCs). The structured approach most commonly used by DoD contracting officers is called the “Weighted Guidelines” method. Under the weighted guidelines method, contracting officers are required to factor in performance risk, contract type risk, working capital, facilities capital employed (if proposed), and cost efficiency when developing their prenegotiation profit/fee objectives.
Some businesses are not aware that the government’s prenegotiation profit objectives, developed via the formulaic weighted guidelines method, can vary widely based upon the underlying assumptions and values used. Furthermore, some businesses do not realize that they can negotiate a higher profit or fee. As a result, these businesses unknowingly accept the Government’s proposed profit rate on contracts that might have higher than normal performance risk and warrant a higher profit.
Attendees will learn how to develop effective strategies that can be used to negotiate higher profit or fee positions that are fully justified under DoD’s weighted guidelines (profit) method application.
Target Audience: Traditional and Non-Traditional Defense Contractors and Small Businesses that pursue Defense RDT&E and SBIR/STTR Contract Opportunities
Meet Your Presenter:
Jeff Cuskey is an acquisition and contracting advisor with over 30 years of experience in federal and defense contracting. Recently, he helped establish successful Procurement Technical Assistance Centers (PTACs) in Monterey, CA and Bozeman MT. In addition to providing independent government contracting consulting and educational services, he developed and taught defense focused MBA acquisition, contracting and program management courses for over 12 years at the Naval Postgraduate School (NPS), Graduate School of Business & Public Policy. Jeff is a retired U.S Navy Commander. During his 20 years of active naval service, he held various leadership, acquisition and contracting positions, including assignments as the Navy’s multibillion-dollar F/A-18 Program Chief Financial Officer and F/A-18 Super Hornet Deputy Contracting Officer. Jeff holds a BA Degree in Political Science from the University of Delaware and a MS Degree in Acquisition and Contracting from the Naval Postgraduate School, Monterey, CA. Additionally, he has earned the Certified Professional Contracts (CPCM) and Certified Federal Contracts Manager (CFCM) professional designations from the National Contracts Management Association (NCMA), the Certified Schedules Contracts Manager (CSCM) professional designation from Centre Law & Consulting, and the Certified Procurement Professional (CPP) designation from the Association of Procurement Technical Assistance Centers (APTAC). Jeff enjoys sharing his extensive knowledge and insight into government contracting issues, regulations and processes and helping businesses become successful government contractors.