Navy Awards $250 Million Contract to Small Businesses

Thirteen small businesses win Navy contract worth up to $250 million.

Another Federal government agency has taken the important step of awarding a significant contract to small businesses. The Department of the Navy awarded 13 small businesses with a contract worth nearly $50 million for 2013 with options to renew through 2018. If they exercise all renewals then the contract is worth a quarter of a billion dollars. The contract is for delivery of various support services including research, development, testing and evaluation.

The contract is what’s known as a “task order” award. This means that the Navy has approved 13 small businesses the right to compete for the right to fulfill the numerous services that together add up to $50 million per year. Each company isn’t allocated a quota; instead the best price for each individual task request by the Navy will win. This means that the 13 companies will be competing against each other but only against each other; no other company can enter the competition to fulfill the requested services.

The Navy is also requiring “cost-plus-fixed-fee”. Under this model, the bids presented by the companies for each bid should be priced in two parts: the actual cost of the service plus a fixed profit amount.

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A little about Mike Periu

Periu founded Proximo, LLC nearly 15 years ago. The company provides small business education and training services with an emphasis on finance and technology.
Periu teaches empowerment through entrepreneurship and economic opportunity. He regularly appears on television and radio talking about these subjects.
Periu also writes for leading blogs about finance. These include: American Express OpenForum, Yahoo! Finanzas and the Huffington Post.
Periu studied Finance and International Business at Georgetown University. He is a Board member at the Council for Economic Education.

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