Labor Rate Studies

Keeping track of competitor labor rate price points while constantly managing your own rate structures is crucial for continued well-being in the fiercely competitive government services marketplace. The government customers' bandwidth for discrimination between bids for low tech support slots is limited to:

price (labor rates);
past performance, to some extent; and
"best value," which relates to value-added activities and productivity.

Customers won't pay for things that do not directly support or benefit them. The average government IT customer, for instance, does not need IR&D, opulent buildings, or ponderous management structures.

The Freedom of Information Act (FOIA) serves to provide information on successful bidder labor rates. The rates produced by government-wide acquisition contract (GWAC) IDIQ FOIAs are gamed and universally devoid of uplift detail. Accordingly, they are little short of useless for divining a company's or division's likely labor pricing on future opportunities. In short, they may as well be encrypted with the incumbent's view of reality demand being the key.

CAI/SISCo has long perfected an in-house competitive labor rate estimation capability aimed at building up pre-gaming labor rates rather than attempting a price-down analysis of gamed rates produced by FOIAs. Our Rate-A-Lator™ tool develops detailed views and build-ups of on-site and off-site and unblended and blended labor rates at the labor category level. This model develops labor rates "bottoms up" using our constantly evolving view of each company and major division's corporate personality. The results are then calibrated with existing contract sources to assure accuracy.

As a custom study, CAI/SISCo can develop competitive labor rates for individual competitors or competitive teams. For bid teams, rates are developed using targeted team composition and considering corporate personalities and roles and responsibilities. The results generated are calibrated with actual bid rates gleaned from our FOIA rate database.

The deliverable is a Rate-A-Lator™ model populated with the average salaries and labor burden elements (labor fringe, overhead and G&A uplifts) for a suite of labor categories. This populated repository is delivered for continued use by the client.

To request a proposal or more information about any of our services and
products, please e-mail Rich Brown or call him at (888) 840-5959.