Bid/No-Bid Decision Checklist
For government contracts
The most common mistake in government contracting is pursuing every opportunity that appears. The best-performing contractors maintain win rates of 40-60% by being disciplined about which opportunities they pursue. This checklist provides a structured framework for evaluating whether to invest proposal resources in a specific opportunity. Work through all 22 questions before committing to bid.
Strategic Fit
Does this opportunity align with your company's direction and goals?
Does this contract align with our strategic plan and core capabilities?
Why it matters: Pursuing work outside your core competencies diverts resources and increases risk. Win rates are significantly higher when the work aligns with what you already do well.
Will this contract help us build past performance in a target market?
Why it matters: Past performance is the #1 evaluation factor in many solicitations. Each contract should build credentials that open doors to future opportunities.
Is this customer relationship one we want to develop long-term?
Why it matters: Incumbent contractors win recompetes at 60-80% rates. Investing in a new customer relationship only pays off if you plan to compete for follow-on work.
Does the contract value justify the business development cost?
Why it matters: Federal proposals can cost $10,000-$200,000+ to develop. A rule of thumb: proposal costs should not exceed 1-2% of expected contract revenue.
Does this work position us for larger future opportunities?
Why it matters: Some contracts are strategically valuable even at low margins because they provide access to follow-on work, IDIQ task orders, or new agency relationships.
Capability
Can you actually deliver what the solicitation requires?
Do we have the technical skills and subject matter expertise in-house?
Why it matters: Evaluators can tell when a company is stretching beyond its expertise. Proposals that demonstrate deep domain knowledge score significantly higher.
Can we meet the staffing requirements with qualified personnel?
Why it matters: Many contracts require specific certifications, clearances, or experience levels. If you cannot name actual candidates for key positions, your proposal will be weaker.
Do we have relevant past performance (3+ similar contracts)?
Why it matters: Most evaluations require 3-5 past performance references of similar scope, size, and complexity. Without them, you will score poorly on what is typically a heavily weighted factor.
Can we meet the security clearance and compliance requirements?
Why it matters: Security clearances take 6-18 months to obtain. CMMC, FedRAMP, and other compliance frameworks require months of preparation. These are hard requirements, not nice-to-haves.
Do we have the facilities, equipment, and infrastructure needed?
Why it matters: Some contracts require SCIF space, specialized labs, or facilities near the customer. Infrastructure gaps cannot be closed during the proposal period.
Competition
What does the competitive landscape look like?
Is there a known incumbent, and can we realistically displace them?
Why it matters: Incumbents win 60-80% of recompetes. Unless the incumbent has performance issues or the evaluation criteria have shifted significantly, displacing them is an uphill battle.
How many competitors are likely to bid?
Why it matters: Your probability of winning drops with each additional competitor. Full-and-open competitions with 10+ bidders yield win rates below 10%. Set-asides and sole-source have better odds.
Do we have a credible discriminator or competitive advantage?
Why it matters: If your proposal reads like everyone else's, you are competing on price alone. A clear technical advantage, unique methodology, or superior past performance gives evaluators a reason to choose you.
Have we engaged with this customer during the pre-solicitation phase?
Why it matters: Companies that participate in industry days, submit RFI responses, and meet with contracting officers during market research are 2-3x more likely to win than cold bidders.
Price
Can you win this at a price that makes business sense?
Can we propose a competitive price and still maintain acceptable margins?
Why it matters: Buying-in (bidding below cost) to win is a losing strategy long-term. If the market rate does not support your cost structure, this opportunity may not be financially viable.
Do we understand the government's budget and price expectations?
Why it matters: The government's Independent Government Cost Estimate (IGCE) sets the benchmark. Proposals significantly above or below the IGCE raise flags with evaluators.
Is this a LPTA (Lowest Price Technically Acceptable) or best-value evaluation?
Why it matters: LPTA evaluations are pure price competitions once you meet the technical threshold. Best-value evaluations let you compete on quality and innovation, not just price.
Can we manage cash flow given the contract payment terms?
Why it matters: Federal payment terms are typically Net 30, but delays happen. New contractors often face 60-90 day payment cycles. Ensure you have working capital to cover 3+ months of costs.
Risk
What could go wrong, and can you manage it?
Is the scope well-defined, or is there significant ambiguity?
Why it matters: Vague requirements increase cost risk, especially on firm-fixed-price contracts. If the Statement of Work is unclear, budget for scope creep and disputes.
What is the contract type, and does it match the risk we are willing to accept?
Why it matters: Firm-fixed-price puts cost risk on you. Cost-reimbursable reduces risk but lowers margins. Time-and-materials falls between. Match contract type to your risk tolerance.
Are the performance timelines realistic?
Why it matters: Unrealistic deadlines lead to performance issues, which damage past performance ratings and future competitiveness. Late delivery on a federal contract can also trigger cure notices or termination.
Are there compliance or regulatory risks we cannot mitigate?
Why it matters: CUI handling, ITAR/EAR, HIPAA, and other regulatory requirements carry significant liability. Non-compliance can result in contract termination, fines, or debarment.
How to Score and Decide
Score each question
Rate each checklist item from 1 (major concern) to 5 (strong position). Be honest — optimistic scoring defeats the purpose of the exercise.
Calculate category averages
Average the scores within each of the 5 categories (Strategic Fit, Capability, Competition, Price, Risk). This reveals which areas are strongest and weakest.
Check for deal-breakers
Any individual item scored 1 is a potential deal-breaker. If you scored 1 on a Capability or Competition item, seriously consider a no-bid unless you have a mitigation plan.
Calculate overall score
Average all 5 category scores. Above 4.0 = strong bid. Between 3.0-4.0 = viable with mitigation. Below 3.0 = likely no-bid unless strategically critical.
Make the decision
Present the analysis to your leadership team with a recommendation. Document the rationale whether you bid or not — this builds institutional knowledge for future decisions.
Invest fully in proposal development
Bid if you can mitigate weak areas
Save resources for better opportunities
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