I'm about to challenge some assumptions here, and I apologize in advance.
Many GovCon professionals claim that an excellent capabilities statement will attract calls from Federal buyers.
When you hear this, you might think, "A quick way to build relationships with buyers? Great, count me in!" So, you rush around, create a cap statement (maybe paying someone thousands to do it) and begin sending it out to every Government email address you can locate.
Today, let's get real about capabilities statements. And here is the real REAL part -- I was a Contracting Officer and Chief of Contracting for a very long time as a Fed. In the offices I worked in and managed, not once did a capabilities statement prompt a call from a Government Contracting Officer for the purpose of offering a company a contract.
Sure, a Small Business Specialist might call to learn a little more about your company. That's their job. Requirements folks might call as part of early market research. It might get you a micropurchase (read more about those here).
But a Contracting Officer calling your company based solely on a capabilities statement is, frankly, not very likely to happen. If you do get a call it will most likely happen because:
1) the office is in a contingency and emergency buying situation, or
2) the Government needs to scare up companies to make up a competition pool because they are trying to get to a particular company, they can't justify a sole source, and the need to ensure the Rule of Two will be met to justify getting to the competitive pool they want.
That's the truth.
So...should you put the effort in to create a capabilities statement for your business? Read more and decide for yourself. I'm giving you the real insider perspective of how the Government views what GovCon tells you is a must. Decide for yourself after learning more about:
What information it should contain,
Who it should be sent to, and
What to expect from the Government after it is received.
What Information Should Be Included in a Capabilities Statement?
Of course there are the basics:
Business name (and logo)
Business address
Company website URL
Unique Entity Identifier (UEI) and Commercial and Government Entity (CAGE) (or NCAGE, or NATO CAGE) code
Point of contact name and information (email and phone number)
Primary and secondary NAICS
Product and Service Code (PSC) and Federal Supply Class (FSC) code
Business certification logos (i.e., SBA certifications like 8(a), those required for the industry, or affiliation with prominent business associations)
Then there are the things that set your company apart:
A succinct summary of the products and/or services provided. Don't be overly generic. Think of it as your 1-minute elevator pitch in writing and focus on your value proposition. Company history is fine but keep it very very brief.
Discriminating characteristics or factors that set your business apart from others in your industry. Don't over-generalize, boast, or overpromise. Make sure you have the receipts to back up claims here. Certifications such as SBA socioeconomic certifications are great but should not be relied upon as an important discriminating factor.
Names of recent key customers, projects, and/or current contracts, to include project titles, dollar values, and your role (if not the prime). Showcase the depth and breadth of your experience.
Some don'ts I commonly find when reading capabilities statements are:
Poor use of the real estate available on a single page. Use narrow margins and shorter headers and footers
Logos and headers that are too big.
Fonts that are too small.
Long paragraphs versus short sentences, bullets, or graphics
Providing information that the Government already has like the title of a NAICS code.
An over-reliance on SBA certifications or business associations
Omitting dollar values of contracts or projects
Summaries that focus too much as company origin and history
Failing to tailor it to the mission of the agency or the types of products or services they buy
There are a lot of GovCons who can help you prepare a capabilities statement for a price. My advice is open PowerPoint or Canva and create a cheap and eye-catching cap statement yourself in a few hours. Don't pay thousands to have one created for you. If the reason you should save that money is not already apparent, the reason will be clearer as you read on.
Who Should Receive Your Capabilities Statement?
This goes against the advice of most GovCon advisors but...DO NOT send the Contracting Officer your capabilities statement unless one of these two conditions are met:
They ask for it
--OR--
You've done your homework, and you know based on historical purchase data for the procurement office in which the Contracting Officer resides that the agency or office routinely purchases the types of products or services you are trying to sell.
Sending your cap statement to every Contracting Officer whose email you have on the off chance they may be buying what you are selling is a big "No Bueno". While you think you're being proactive with your marketing, what you are really saying to the Contracting Officer is:
1) "I don't understand your role or how the procurement process works, but I'm super excited about the fact I have the email address of a real person who might be able to give me a Federal contract."
Contracting Officers don't decide WHAT to buy. They decide HOW to buy. The "WHAT" is decided by the Requesting Activity. If you what to market an innovative product or service, instead try to find out who the Requiring Activity points of contact are and send your capabilities statement to that person / group. This gets your business cred directly to the technical experts and, possibly, the end users.
Contracting Officers use the SBA's Dynamic Business Business Search (DSBS) database and SAM.gov as their authoritative tools for small business information. You are far better off making sure your DSBS and SAM registration reflect your business information correctly than floating a Contracting Officer a cap statement.
While you are maximizing the information in your DSBS record, be sure to add your website URL AND ensure that it matches what your SAM and DSBS reflect. You don't want your DSBS to say you do IT services but your website to reflect janitorial services. (Use our instruction guide to update your DSBS record.)
2) "Although I didn't do my due diligence to learn more about your office, agency, or buying trends before firing off this capabilities statement, please take your valuable time to open this attachment and provide a response."
If data "ain't your thang" and you don't want to pay for a tool or someone to do it for you, then you are better off sending your capabilities statement to the cognizant Small Business Specialist or Office of Small Disadvantage Business Utilization (OSDBU) for the procurement office.
It is the job of Small Business Specialists to:
Collect information on the pool of eligible small businesses that can support the agency's mission.
Know who is in that pool and their qualifications.
Provide input on available small businesses to the Contracting Officer as part of the Project Team during the market research phase.
Serve as an advisor during the formulation of the Government's acquisition strategy.
Perform small business outreach on behalf of the agency.
(Psst! If you need to know more about the roles in Federal procurement, check out my blog post "Hate the Game, Not the Players - Know the Roles in Federal Contracting".)
What Should I Expect After Sending My Capabilities Statement to the Government?
This is where it gets real. The true answer? It depends on where the Government is in its procurement cycle and who you send it to. Most of the time, it will sit with no action taken. That's the honest to goodness truth.
Conferences. If you hand a copy of your capabilities statement to someone in person at a conference, the likelihood is that it will sit in a general file that is cleared out periodically to keep it current or end up in the circular file. Only the Small Business Specialist or possibly the Requiring Activity will follow up and then, only if your differentiators make you really standout from the crowd. (Those differentiators are KEY.) Feds are not likely to make a follow up call based on a capabilities statement.
Contracting Officers. If you sent it to a Contracting Officer and they didn't ask for it, don't expect an answer or response. They get a lot of these docs. The email will either go in an email folder for possible later use ONLY if the Contracting Officer knows about upcoming purchases and it's a possible match. They are not required to keep source lists.
If it is not deleted, it may be forwarded to the Small Business Specialist, OSDBU, or the requirements activity, if the agency makes purchases like what you offer.
If the agency doesn't buy what you are selling, they likely will not respond, and your cap statement and email will be deleted. Frankly, that's on you for not doing your homework. Don't waste your time or theirs. ALWAYS. DO. YOUR. HOMEWORK.
The chance of a Contracting Officer passing your email along to other agencies or friends / colleagues that are also buyers are very very low. If anyone tells you this happens, they don't know any Contracting Officers. Nobody has time to worry about another agency's buys.
Requiring Activity. The Project Manager is interested in one thing; can you deliver a quality product on time and within budget. If there is a current acquisition, they can't talk to you. If there isn't, this is your best point of contact to start a conversation about future requirements. If you want your cap statement to grab them, tailor it to them.
Small Business Specialists and OSBDUs. Let's say your cap statement makes it through at its easiest entry point for interest and possible action -- the Small Business Specialist. You still might not hear anything, but your cap statement will get filed because this person is required to keep tabs on their outreach efforts and have a ready list of small business sources not only for the Contracting Officer but for large business primes who are not meeting their goals. You have a chance of achieving a follow up call or meeting with the Small Business Specialist more than the other because of their need to track their own due diligence of tracking small businesses.
What type of info might you get as part of follow up with a Small Business Specialist? They can--
Talk to you about upcoming acquisitions; they are involved in the forecasting process.
Talk to you during the acquisition cycle when Contracting Officers and technical Subject Matter Experts or Project Managers can't due to potential conflicts of interest.
Tell you who the Requiring Activity is and make introductions.
Answer procurement questions and provide insights into agency buying trends.
Introduce you to primes with subcontracting plan requirements looking for small business subcontractors.
This builds a relationship with THE internal advocate for small businesses. They get to know your company and IT'S THEIR JOB TO DO IT. Even though they are only advisory in nature, the Contracting Officer must conduct coordination with them on every action over a specific dollar value that is procured, including those set-aside for small business and obtain their concurrence. They are a gatekeeper for small business participation.
Isn't that the person you want to talk to? YES, you do. Because they WILL remember you. They will keep your cap statement. And it is their job to help.
So, after all that...
Are Capabilities Statements Worth the Effort?
Yes, but only when...
Done without spending tens of thousands on the effort.
It easily differentiates your company from your competitors.
Tailored to target agencies and their buying history and trends.
Sent to the right person at the agency and at the right time.
YOU follow up to build relationships and market how you can help THEM (not ask for a contract or information).
Capabilities statements are not a check-the-box exercise that is then rapid-fired to all the Government email addresses you have in order to ask for a contract or information. If you use it...
It must look professional.
Make it meaningful.
Be intentional on who receives it.
Have realistic expectations about the outcomes they can generate.
It's not a MUST to create a capabilities statement. It is only one tool in the marketing tool box. While it may not get you quick wins or call backs, it can be a useful tool to --
Help you hone your elevator pitch.
Stick to a script of talking points when talking to Feds.
Aid in finding and focusing on your business's core capabilities.
Identify key discriminators that set your business apart from your competitors.
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