27 Aug Single Award IDIQ vs Multiple Award IDIQ
Single Award and Mulitple Award IDIQs are a primary way that government organizations solicit contracting work. Single Award IDIQs are often more favored, since these contracts are awarded to a single party.
Multiple Award IDIQs on the other hand, are awarded to a group of companies or contractors who must then compete for each project, with those who provide the best proposals winning.
What is an IDIQ?
IDIQ stands for indefinite delivery/ indefinite quantity, which means that in a specified period and contract amount, a contractor or groups of contractors will be available to deliver goods and services. Many contractors may have a love/ hate relationship with this model, as it could mean they’re tasked with a lot of work that earns them the contract amount, or it could mean they received few tasks on the contract. Since these contracts can often range to $25 million or more, it’s understandable why a contractor might take the risk. You can find an in-depth look at what an IDIQ is here.
How Does a Company Earn An IDIQ?
Depending on the industry, the government often has portals where solicitations for IDIQs can be found. These are also listed on government websites and support sites. The listing will contain the requested period, the initial projects needed, location and any specific restrictions for the posting. For example, an RFP (request for proposal) could be set out for general construction at a military base, set aside for women-owned small businesses only.
A company interested in earning the IDIQ would then submit their proposal before the close date, and be notified if their company was selected.
Single Award IDIQs Versus Multiple Award IDIQs
IDIQs are an ideal method of contracting for the government. You can discover the reasons for this here. As mentioned before, single Award IDIQs are given to one contractor, while multiple Award IDIQs are given to several. When the government issues a task order on the project, the process will change depending on the type of IDIQ.
When a task order on a project is issued, the task will go to the contractor on the Single Award IDIQ to be completed. Although the contractor may employ subcontractors, the revenue for the task will go to and through the main company.
However, the process for a Multiple Award IDIQ is very different. When a task order is issued on the project, it does not go to a specific company. Instead, those companies that are participating in a Multiple Award IDIQ will compete for each task by delivering another proposal and winning the job. This can either be very lucrative for a high-performing company, or leave others with no revenue from the contract.
The bidding process and awarding of multiple contracts within an larger contract can make working within IDIQs time consuming and less favorable. In fact there are other contract models that are much easier to work with (see IDIQ vs BPA Contracts.) On the other hand, the potential revenue and size and scope of the IDIQ from a government institution sweetens the deal.
Prime or Subcontractor?
In many multiple IDIQs, you will initially bid as the prime contractor or a subcontractor. This choice is very complex, and it’s important to remember that there is no guaranteed money when you win a multiple award IDIQ. Instead the money comes from bidding on task orders.
Prime contractor positions are best filled by large companies with teams that have many contacts within the customer and surrounding agencies. Their job partly entails keeping task orders generated for subcontractors to bid on. If you elect to be a subcontractor, it’s important to familiarize yourself with the prime contractor and how they select their subcontractors. This is the last and perhaps biggest difference between single and multiple award IDIQs… multiple award IDIQs require an impressive amount of bidding and networking as well as actual contract performance.