Responding to Requests for Information (RFI) and Sources Sought (SS) begins the revenue lifeblood cycle. 

Contract officers and contract specialists rely on these preliminary documents as precursors to bid solicitation and ultimate award. It is important to remember that the same persons ultimately responsible for reviewing submissions and the award of the contract are likely to be those who construct RFI and SS narratives.

The Federal Government uses the RFI to seek input from industry about the solicitation to follow. Agencies issue an SS as part of their market research to determine which, if any, companies are capable and willing to perform work as specified. By completing these documents, you are assisting the government to shape the procurement and determine the associated procurement strategy, such as competition being set aside for smaller companies.

We term this process revenue lifeblood as it begins the company commitment to pursuing a particular revenue stream. It also gives the government an understanding that your company wishes to participate in the coming procurement.

Be sure to express written response to the agency when it issues an RFI or SS, particularly if you sense this is a new procurement, the incumbent performing the work has outgrown its size, the government is considering a different type of procurement strategy that benefits your company, or if your company’s offering presents an alternative solution.

Development of Key Performance Indicators (KPIs) help to measure the effort supporting RFI and SS response.

Tracking hours for this type of activity, while not bid and proposal (B&P) per se, deserve its own charge code under business development. Target 10% of annual Proposal Costs for RFI and SS responses. Proposal costs are defined here as the sum of labor hours from staff dedicated to proposal development, outsourced proposal management, and cost attached to any tools or meetings in support of the proposal development. This percentage will decrease as your proposal library gets built and dedicated BD professionals join the firm.

For clarity, B&P is the recognized term the government uses to characterize labor and expenses companies dedicate to proposal preparation and submission. At the RFI and SS stages, it is unlikely that companies would authorize funds charging a B&P account.

By example, let’s assume the following scenario:

• Current year projected revenue of $10M,
• Projected Submitted bids, current year of $100M,
• Assume annual Proposal costs equals .005 of current year submitted bids, or $500,000,
• Assume Average salary rate, internal persons preparing proposals equals $125,000, or $60.10 per hour,
• 10% of annual internal proposal costs dedicated to RFI and SS,

 Therefore you would allocate $50,000 internal labor cost allocated annually to RFI and SS responses (10% x $500,000).

While actual formula results will vary, smaller GovCons establish KPIs for RFI/SS performance.