Small firms rarely lose money on the bids they pass on. They lose it on the bids they should have passed on: the 60-page RFP that ate two weeks of the owner's time for a contract the incumbent was always going to keep. A consistent bid/no-bid process is how you stop doing that.
Below is the scoring checklist I'd hand to a new salesperson. It isn't scientific, and the weights should change to fit your business. The point is to make the decision quickly, on the same criteria every time, and to write down why.
Step 1: Knockout questions
Answer these first. A "no" on any of them ends the discussion unless you can fix it before the deadline.
- Are we eligible? Registration (for federal work, an active SAM.gov registration; for state and local, whatever vendor registration the agency requires), required licenses, and any set-aside status. Our set-asides guide explains the federal categories.
- Can we meet every mandatory requirement: certifications, manufacturer authorizations, insurance limits, bonding, staff qualifications?
- Is there enough time to submit a compliant response, including any mandatory site visit or pre-bid meeting?
- Can we accept the contract terms, or are there terms (unlimited liability, liquidated damages, payment timing) our business or insurer can't live with?
- Can we deliver in this location?
Step 2: Score the opportunity
If it passes the knockouts, score each factor from 0 to 5. I've suggested weights that suit a typical small reseller or service company; adjust them.
| Factor | What a 5 looks like | What a 0 looks like | Weight |
|---|---|---|---|
| Customer relationship | We've talked to the buyer or end user before the solicitation, or we've served them | Never heard of them until today | 3 |
| Scope fit | Squarely our core work | Mostly outside what we do | 3 |
| Past performance | Several similar, recent projects with good references | Nothing comparable | 2 |
| Competitive position | Open competition, no entrenched incumbent, or incumbent has had problems | Incumbent with a strong record, or specs clearly written around a competitor's product | 2 |
| Evaluation method | Criteria favor our strengths (for example, service approach weighted heavily if that's where we shine) | Criteria favor what we're weakest at | 2 |
| Price competitiveness | Our costs are at or below market, we know the likely price range | We'd have to bid below cost to win | 2 |
| Profitability | Healthy margin at a winning price | Break-even at best | 2 |
| Strategic value | Opens a new customer, contract vehicle or reference we need | One-off with no follow-on | 1 |
| Proposal effort | Short response, reusable content | Heavy custom writing, presentations, samples | 1 |
| Delivery risk | Straightforward, low risk | Tight timelines, penalties, supply chain doubts | 1 |
Multiply each score by its weight and add them up. With these weights the maximum is 95. Set your own thresholds after you've scored a few bids, but a starting point might be:
- 70 or above: bid, and put your best people on it
- 50 to 69: bid if you have capacity, or look for ways to raise the score (a teaming partner, a question to clarify a spec)
- Below 50: pass, unless there's a strategic reason you can explain in one sentence
How to score the hard factors
Customer relationship
Ask honestly: does anyone at the agency know who we are? A buyer who has met you, asked your advice during market research or bought from you before is more comfortable choosing you. Responding cold to a best-value RFP is harder than responding cold to a low-price IFB, where relationships matter less.
Competitive position
Look for the incumbent. For federal work, award data on USAspending.gov usually shows who holds the current contract. State and local agencies often post prior awards or bid tabs, and a public records request can fill gaps where state law allows. A spec that names one brand with no "or equal" language, or requires an oddly specific feature, often means a vendor helped write it. You can ask about that during the Q&A period.
Price competitiveness
If there's a bid tab from the last time this was bought, compare it with your cost. If the last winning unit price is below your cost, you need a better answer than "we'll sharpen our pencil." See how to price a government bid.
A worked example
A county issues an RFP for managed IT services for its 12 departments, three-year base term. Your firm does managed services for two small cities in the same region.
- Knockouts: registered with the county, insurance meets the limits, no bonding, 21 days to respond. Pass.
- Customer relationship: 1 (you met the IT director once at a conference) × 3 = 3
- Scope fit: 5 × 3 = 15
- Past performance: 4 × 2 = 8
- Competitive position: 2 × 2 = 4 (incumbent has held it for eight years)
- Evaluation method: 4 × 2 = 8 (60% technical, 40% price)
- Price competitiveness: 3 × 2 = 6
- Profitability: 3 × 2 = 6
- Strategic value: 5 × 1 = 5
- Proposal effort: 1 × 1 = 1
- Delivery risk: 3 × 1 = 3
Total: 59. That's the "bid if you have capacity" zone. The weak spots are relationship and incumbent strength. You might still bid if you can use the Q&A to learn why they're rebidding (sometimes it's a statutory requirement to recompete, sometimes they're unhappy), and if your two city references are strong. Either way, the team knows why it's bidding and what it's up against.
Make it a habit
- Score every opportunity that gets past a quick read, even the ones you pass on.
- Keep the scores in a spreadsheet with the outcome. After a year, check whether high scores actually won. Adjust the weights.
- Have one person own the call. Scoring by committee drifts toward "let's just bid."
- Decide early. The best time for a no-bid is before anyone starts writing.
The fastest way to raise your average score is to see more opportunities that fit, so you can be choosy. Filter open bids by your category and region and score the ones that match. BidsNexus also sends free daily alerts for new bids in your categories.
Frequently asked questions
What score should trigger a bid?
Set your own thresholds after scoring a few opportunities. A starting point is to bid at 70 or more out of 95, consider bids from 50 to 69, and pass below 50.
How do I find out who the incumbent is?
For federal contracts, check award data on USAspending.gov. For state and local work, look at prior award notices, bid tabulations, board minutes or a public records request.
Should we ever bid on a low score?
Only when there is a clear strategic reason, such as a new customer or contract vehicle you need, and you can explain it in a sentence.
Sources: www.usaspending.gov sam.gov www.sba.gov