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SpendLogic Publishes Guide To Weighted Guideline Tool

Oct 29

A effective Contractor Purchasing System Review (CPSR) results in a “approved” purchasing system, which opens the door to a lot more government work. According to the DFARS, a CPSR guarantees that a contractor follows a structured approach to buying procedures (Defense Federal Acquisition Regulations). Every CPSR requires a cost analysis to ensure that benefit targets are fair and rational. In implementing government contracts, profit is a major motivator. The contracting officer may add a standardized fee to certified costs by using a structured benefit strategy. It also allows contractors to discuss real profit margins.

Prime contractors, subcontractors, and government contracting officers may use a range of methods to fulfill the specifications outlined in the DFARs, including benefit analysis tools. The DFARS explicitly mentions the Weighted Guidelines Method (WGM) as one method of benefit analysis.

The WGM is a method used by contracting officers to assess benefit and is defined in DFARS 252.404-71. It's basically a calculator that shows you your benefit percentages as compared to certified costs by concentrating on four main factors.

The fee rate is determined by risk factors when developing your benefit goal using weighted guidelines. The DFARs have been translated into a spreadsheet-based tool by a number of government websites, and it is divided into six parts.

When assessing benefit, using the Weighted Guidelines Method signals to federal contracting officers and Prime Contractors that you fulfill the DFARS criteria. Providing weighted guidance could also help GovCons meet higher benefit targets in their contracts, for example, by increasing technological reward ranges for special factors. Where DFARS does not require such an analysis, a weighted guidelines analysis can help to clarify negotiations. If you can prove that you're working hard to cut costs, the buying agency could let you set profit targets that are higher than the set range.

On the other hand, sales teams who use the Weighted Guidelines Method send a message to the contracting officer that they are using a systematic approach to cost estimation. More confidence is gained when contractors have solid, quantifiable pricing.

SpendLogic specializes in providing online CPSR compliance tools to government primes and subs. They also provide consulting services focused on cost analysis of certified cost or pricing data, sole source selection documentation, commercial item determinations (CIDs), negotiations, and policies and procedures manuals. When it’s time to begin your bid, SpendLogic's tools and expertise can be your guide.