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Creating a Compliant Cost Proposal Volume

At this year’s Government Contract Pricing Summit, there were over thirty-four breakout sessions, in addition to numerous general sessions from keynote speakers and panelists. 

What follows is a summary of some of the aspects covered from a session led by Don Shannon - The Contract Coach, and Patrick Mathern – President, SpendLogic. The session was entitled, “Creating a Compliant Cost Proposal Volume” on Day 2 of the Summit:


The session discussed various aspects of a cost proposal, particularly focusing on important text about information protection, and key components that should be included. It highlighted the significance of a letter of transmittal, the authorized signatory on the proposal, acknowledgments of amendments, and representations and certifications.

One part of the session delved into the small business subcontracting plan, certificates of insurance, and corporate financial reports. It emphasized the importance of listing items and prices accurately and making appropriate assumptions to avoid conditional responses.

Another aspect of the cost volume that was covered emphasized the need for a generalized introduction, company bio, photos, and bios of officers, and a milestone schedule to provide an overview of the proposal's content.

To highlight some salient items covered:

  • Ensure the front cover of the proposal includes all necessary elements as per the regulations.
  • Mark the proposal as "restricted" to protect sensitive information and provide a proper legend on relevant pages.
  • Consider including a letter of transmittal, signed by a senior company individual, to assure good oversight and management of the project.
  • The person signing the proposal must be authorized to bind the company legally.
  • Acknowledge all amendments made during the solicitation process in the proposal.
  • Be aware of specific representations and certifications required for each solicitation.
  • Include a small business subcontracting plan, highlighting percentage goals and total dollar value for subcontracting.
  • Provide a certificate of insurance and corporate financial reports if requested.
  • List items and prices accurately and use assumptions wisely without making conditional responses.
  • In the cost volume, introduce the company with a short bio and photos of officers, and include a milestone schedule to orient the readers and build confidence in your proposal.

The session also covered various topics related to estimating and pricing in the context of cost proposals. It included discussions about proprietary information, identifying business systems, different estimating techniques (top-down, bottom-up, and new models like G- ease AI), earned value requirements, creating an estimating plan, the cone of uncertainty, and the importance of providing data and explanations for pricing decisions.

A few points covered by the presenters included:

  • Consider the sensitivity of proprietary information while preparing proposals.
  • Identify if your company has any of the specified business systems and provide necessary documentation.
  • Explore different estimating techniques like top-down, bottom-up, and new models like G-ease AI.
  • Use both top-down and bottom-up approaches to create estimates for better accuracy.
  • Have a structured estimating methodology, including an estimating plan, work breakdown structure, project schedule, and cost model.
  • Ensure your costing methodology integrates data from various corporate systems.
  • Include a discussion of uncertainty or risk in your proposal.
  • Present data sources and explanations for pricing decisions.
  • Use vendor quotes and conduct price analysis for material costs.
  • Focus on the top 80% of material costs for pricing and provide additional support if required.
  • Tell a comprehensive story of where your numbers come from and provide necessary calculations and explanations for pricing decisions.

If you attended the 2023 GCP Summit, we’re confident you found sessions like this one to be valuable and thought provoking. If you weren’t able to attend this year, start planning to be part of the discussion at the 2024 GCP Summit in beautiful sunny San Diego, June 11-13, 2024!