I am sure all of us would benefit from your experience in bidding and managing government contracts and programs. Please share how you did it differently and at less cost. With those savings, I am sure you were wildly successful.
I definitely find his statement curious..
I have worked at the executive level in the government services for a couple of decades at this point...
There were a few times back during the height of the Iran/Afghanistan conflicts where services providers to the USG could get away with fee rates of 10-12%.. I can remember 2 contracts specifically that were awarded around the 2012 time period that we celebrated wins on where we got 12% on the deal...
Mind you this is at the height of demand from the Fed Gov.. this is after the country had recovered from the economy crashing and staying compressed from 2008-2010.. both conflict theaters still had large numbers of troops present, etc.. and the govt is releasing contract after contract in rapid succession trying to get infrastructure rebuilt in both place.. so huge need for people and things.. and not a lot of people or things were available..
Key to note.. depending on the "service" being offered.. standard margins in the US range from 10-20% when dealing with private sector contracts... So pulling 12% on a public sector contract puts you snugly against the bottom of the "average" shared among US services providers...
Today... we typically get somewhere between 6-8%... and we're happy to get that.. the government is still very much in "LPTA" mode (Lowest Price, Technically Acceptable).. meaning they straight up tell you that whoever provides the lowest price to the government is who gets the work.. they dont care about value add or that Company A might be 5% more expensive, but offers 20% better quality than Company B... If Company B is 5% cheaper and 20% lower quality, as long as they can get the job done to the minimum standard, Company B wins the work.. We are, and have been in, a period of "made by the lowest bidder" methodology that US Govt contracting companies find success in....
Thats not to say that $300 toilet seats didnt happen at one time..
But.. I will say, that they are a very rare occurrence these days.. and if they do happen, as often as not its actually a mistake on either the govts part or the contractors..
Because there will be hell to pay, jail sentences to serve, and careers lost if proven otherwise...
And if you expect to go into a govt bid with wages and margins set at typical public sector rates and actually win work.. good luck to you.. youre very likely going to be shuttering your doors soon...
You make money in government contracting through volume... the trick is to sell tens of millions in value at a low margin.. as opposed to selling hundreds of thousands with solid/market rate margins..