Axim Overview

The New State of Government Contracting

Through a number of new policies, government contracting is being run more like a “business” than ever before. Let's take a look at some of these legislative changes and how they’re impacting government contractors today. One of the best examples of this is the Lowest Price Technically Acceptable (LPTA) contract. A method where basically the government selects contract bids by their price instead of other factors. This has created quite a controversy in the contracting world with contractors both for and against LPTA contracts. Lowest Price Technically Acceptable Those in favor of LPTA contracts feel it will save money by creating competition in driving prices down, speed up projects, and allow smaller contractors to compete on bigger contracts. Those against feel the “potential savings” in price and time comes at the cost of quality, innovation, and design. Not to mention it also narrows profit margins. Despite which side you’re one, there’s one big reason we at Axim Fringe Solutions Group feel LPTA is here to stay. On average, an LPTA contract costs 50% less and gets completed 15% faster than a “best value” contract. Until something better comes along, LPTA contracts will be part of the government landscape for the foreseeable future. Contractors must adapt to this new LPTA landscape. “Business is how it is, not how it was.” Another key factor weighing on government contractors is the DOL’s “NEW” stance on compliance enforcement. Earlier this year (March 2015) Labor Secretary Thomas Perez said: DOL Enforcement The DOL is now going after companies they are know are vulnerable. Contracting has always been a vulnerable industry. Consider the following: In 2014, 78% of contractors audited by the DOL were found to be NOT in compliance Almost 50% of the audits conducted by the DOL in 2014 were NOT complaint-based That’s some low-hanging fruit for an agency looking for vulnerability. Contractors can no longer operate under the assumption that if their employees aren’t complaining… everything’s fine. Besides DOL violations leading to stiff financial penalties contractors also run the risk of jeopardizing “future consideration” for contracts. The best evidence of this is that government suspensions and debarments have been on the rise for the last five years. Government Suspensions and Debarments The numbers don't lie! The government is not only taking more shots, but also hitting harder at compliance violations than ever before… and they’re just getting started. The DOL Wage and Hour Division (WHD) has requested a $41 million budget increase for FY2016, which would allow them to add 300 NEW full-time investigators along with upgrades to its technology. It’s a clear sign that compliance violations are going to be a huge part of government contracting moving forward. With the government lowering contract profitability through LPTA and compliance being a bigger deal than ever, the modern contractor must adapt to the “new” government if he / she wants to survive in the marketplace. How do you adapt to this "new government"? Government Contracting Profitability Solution How does Axim know so much about the "new government"? We are a company specifically suited for government contracting. Our policies and platforms are designed to help contractors innovate their business. Axim Fringe Solutions Group wants to help you increase your contract profitability through benefits. Axim Fringe Solutions Group BenefitsIf you want to know more about how Axim FSG can help make you more profitable please contact us: Follow Axim Fringe Solutions Group on Twitter & LinkedIn. [embed][/embed]    

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