Forbes.com |
As a result,
teaming relationships for small businesses are of particular interest, and can
provide an excellent opportunity for new business either as a prime or
subcontractor, with new partners and relationships. However, teaming does come
with issues that are of particular concern as well, such as running afoul of small business size status, eligibility,
affiliation, and being taken advantage of by firms needing to “rent” a
designated socioeconomic designation.
Here are
three issues to consider when teaming for small businesses:
1. Details. Worrying about details later is a recipe
for disaster. The teaming agreement should detail how the parties will
structure the team, and the work that each party will be performing through a
clear statement of work. Further, the teaming agreement should have very
specific terms that demonstrate the party’s intent to be bound in the structure
of the relationship (e.g. the proposed prime contractor “SHALL”),
and their performance in connection with the contract, such as those that meet
limitations on subcontract provisions. You should also have a copy of the
subcontract you plan on entering into, should the proposed prime be awarded the
contract.
The last
thing on Earth you want is to have an unenforceable agreement that is not
definitive enough to qualify as enforceable. Do not leave details vague, and
do not leave issues subject to too many conditions.
2. Communication. Small businesses must ensure that
when executing the contract, there are no negative impacts on their
small business size or status. Make sure that any issues
such ownership, control, and affiliation are dealt with, and that all
requirements for small business regulations and governance are met. This is
especially true for firms that are certified in the Small Business
Administration’s 8(a) program, and for veteran owned business certifications by
the Department of Veteran’s Affairs.
3. Exclusivity. The purpose of the relationship is to
create a winning team that complements each other, and having each party add
capability that wins the contract and differentiates the team from the
competition. Exclusivity provisions are especially necessary for small
businesses as primes, because it prevents the larger businesses sub from
“shopping around”, and teaming with others businesses to win no matter what.
Not having exclusivity provisions defeats the purpose of teaming. Make sure that
your proposed teaming partner is teaming with you, and you alone, such that you
are the only offeror benefitting from what the teaming partner brings to the
table.
Understand
that your short-term gain could have devastating impacts long-term. Small businesses
too often sacrifice these concepts, and that is a mistake. A small business
should understand that they need to be prepared to walk away from the teaming
agreement, if it is in your firm’s long-term interest.
Always consult a legal professional, and ensure your teaming agreements are clear, concrete, and will help shape the successful teaming partnership to the benefit of both parties.
Always consult a legal professional, and ensure your teaming agreements are clear, concrete, and will help shape the successful teaming partnership to the benefit of both parties.
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