Crafting a proposal for the GSA Multiple Award Schedule (MAS) involves drafting and collecting numerous documents. Many of the items needed for a successful proposal can be easily found in a company’s records, but others are less familiar. One document that can be a stumbling point for many new contractors is a small business subcontracting plan. All large (Other than Small) businesses are required to draft a subcontracting plan, but for offerors who have never created a subcontracting plan, this document can seem daunting. In this blog, we’ll go over tips and tricks for drafting a subcontracting plan.
Before we go over those tips and tricks, however, we’ll first explain in a bit more detail what a subcontracting plan actually is. A GSA MAS subcontracting plan simply describes an organization’s goals and plans for small business subcontracting. There are two types of subcontracting plans, commercial and individual. Commercial plans cover all subcontracting (i.e., for both government and commercial sales) and apply to only the contractor’s fiscal year, while individual plans are specific to a single contract (i.e., the GSA MAS) and cover the entire contract period.
For contractors who already do a lot of subcontracting, a commercial plan may be easier, but those who don’t typically subcontract, an individual plan is typically simpler. In this blog, we’ll be focusing more on tips and tricks for developing an individual plan, as that is the most common type of plan used on the GSA MAS.
This tip may seem obvious, but for contractors who are completely new to GSA and to subcontracting, it can feel difficult to even know where to start. Luckily, GSA provides templates for both commercial and individual plans, meaning that offerors don’t have to start from scratch. In addition to being an outline for the subcontracting plan, the templates (especially the individual plan template) contain helpful information about subcontracting requirements, goals, and resources.
It’s tempting to scroll past all the instructional language at the beginning, but these pages are full of instructions, examples, and reminders that are invaluable to those new to subcontracting plans. The template itself also contains instructions throughout each section, explaining how to fill things in. Using the GSA’s subcontracting template is just the first step in making drafting a subcontracting plan a little bit easier.
The first major step in developing a subcontracting plan is developing subcontracting goals. Developing these goals involves threading a needle: your goals need to be high enough that they will be accepted by GSA, but low enough that they will be achievable. Your subcontracting goals will need to be broken down by socioeconomic subtype. There are 5 subtypes identified by the GSA: Veteran-Owned Small Business (VOSB), Service-Disabled Veteran Owned Small Business (SDVOSB), Historically Underutilized Business Zone (HUBZone), Small Disadvantaged Business (SDB), and Woman-Owned Small Business (WOSB).
For contractors with no subcontracting experience, it may feel like developing these goals is taking a shot in the dark. However, there is some guidance: the Small Business Association (SBA) provides minimum subcontracting goals for each socioeconomic subtype. If you truly have no idea where to start with your goals, you can simply use the SBA minimum goals. These goals are updated for each government fiscal year, so be sure you’re using the most up-to-date ones when creating your subcontracting plan.
One final note: while the SBA doesn’t technically provide a goal for VOSBs, they do provide a goal for SDVOSBs. Since all SDVOSBs are VOSBs by definition, your VOSB goal simply needs to be equal to or slightly higher than your SDVOSB goal.
Some offerors struggle to draft a subcontracting plan because they don’t see a realistic way to subcontract their work. This is often true of product vendors—there’s not much opportunity for subcontracting when fulfilling a simple product order. When this is the case, a way for contractors to still develop subcontracting goals is to use indirect costs.
The GSA defines indirect costs as “the expenses of doing business that are NOT easily identified with a specific project (i.e., contract or grant) but are generally recognized as ordinary and necessary for the general operation of the contractor’s organization and the conduct of activities it performs.” This can include things like supplies, janitorial services, administrative costs, and security costs.
Tracking and reporting indirect costs can be complex and time consuming, so you should only include indirect costs in your subcontracting plan if you have no other options for subcontracting. If you do include indirect costs, you must identify that in the subcontracting plan and include how the indirect costs were calculated and why you are including them. While this does mean extra work, it is a very helpful option for contractors who would otherwise have no avenues for subcontracting.
In this blog, we covered some basic tips, but subcontracting plans can get very complicated if you have no experience. If you want more help with developing a subcontracting plan, or any other aspect of your GSA Schedule offer, reach out to us. One of our talented consultants will be happy to help.