Subcontracting

You have found an excellent opportunity for your company, but you can’t meet all of the requirements or are only interested in a portion of the work. Consider subcontracting as a possible solution.

Most competitive solicitations will allow subcontracting, where the goods, services or construction are proposed to be delivered by more than one vendor. This can be an excellent opportunity if, together, two or more vendors have the expertise and capacity to provide everything requested that they wouldn’t have on their own.

If subcontracting is not permitted, the solicitation will state this. If you’re not sure, ask the named government contact for the solicitation that interests you.

 

Reasons For Subcontracting

Some solicitations require very specific expertise that may not be commonly found or vendors may only be able to meet the commitments in the solicitation with additional help. Both are excellent reasons to consider subcontracting.

 

Lead Vs. Subcontractor Roles

The lead is the single vendor who signs the solicitation submission, indicating that they are taking the responsibility to be bound to it. Typically, the lead is known as the bidder, proponent or respondent, and all others are referred to as proposed subcontractors. If this submission is successful, the resulting contract or purchase order will be with the lead vendor only (known as the contractor once the contract or purchase order is executed). This contractor is responsible for all deliverables, including those provided by the subcontractors.

The subcontractor(s) to a contract or purchase order will not have a direct relationship with the Province, but will be responsible to the lead for their portion of the deliverables, as agreed between the lead and subcontractor(s).

Although the contract will be between the Province and the Contractor, any subcontractors involved are usually named in a schedule to the contract.

 

Disputes With Subcontractors

If a government contractor is in a dispute with its subcontractors, the Province will not become directly involved. However, if that dispute results in issues with deliverables (e.g. quality diminishes, timelines are not met, etc.), the Province will expect the contractor (i.e. the lead) to resolve the issue. It is the contractor’s responsibility to ensure the quality, quantity and timeliness of all deliverables, regardless of any issues that may arise with subcontractors. Carefully consider this when determining which vendor should be named as the lead.

Refer to Subcontractor Relationships for suggestions provided to government buyers on this issue.

 

Evaluating Subcontractors In Submissions

Unless a solicitation specifically states that subcontractors are not permitted, their experience and capabilities are usually included in the evaluation process. Some solicitations may have some differences in how the lead and proposed subcontractors are evaluated, but this should be explained in the solicitation document. If you’re unsure, ask.

Be sure to clearly explain what any proposed subcontractors will be responsible to do, and how the lead intends to ensure the quality and timeliness of these deliverables. Scores may be affected if this is unclear.

 

Hints and Tips For Successful Subcontracting

The following suggestions may be helpful in determining whether or not subcontracting should be part of your submission:

  • Determine if all the requirements can be met well by only one vendor.
    Some solicitations include specific expertise or skilled staff that no single vendor is likely to have. It’s also possible that a single vendor could meet all the requirements stated in the solicitation, but the submission would do even better if expertise and capacity was enhanced by including one or more subcontractors. As the lead or one of the proposed subcontractors, this approach may increase your chances for success.

 

  • Consider past working experience between the lead and proposed subcontractor(s).
    If you have worked together in the past, you should know how much effort is likely required to successfully deliver the applicable goods, services or construction if you were offered the contract or purchase order. If issues occurred in the past, consider how you could pro-actively develop solutions that would avoid those same issues from happening again. If the relationship worked well before, be sure to include the same strategies (to the extent that you can) to repeat that success. Consider the location and duration of the contract and the ability of the subcontractor or main contractor to meet your ongoing needs.

 

  • Consider establishing a formal agreement with the proposed subcontractor(s).
    This agreement could describe how you will mutually deliver components of the work, and may avoid delays in finalizing the details with the Province if you are successful in the solicitation. 

 

  • Work collaboratively with all parties while developing the submission.
    Your submission should be understood and agreed to by the lead and all proposed subcontractors. If offered the contract or purchase order, none of the participating vendors should find anything surprising in the submission.

 

  • Name the lead and all subcontractors in the submission
    Evaluating your submission will be much easier if the proposed subcontractor(s) is named, and all roles and responsibilities of each participating vendor are clear. Some solicitations may even require this. Be sure to clearly elaborate the strengths that each vendor brings to the submission (e.g. specialized expertise, depth of resources, capacity to deliver, etc.).

 

  • Clearly identify which vendor is the lead.
    Significant issues can occur if the Province is not able to determine which vendor is the lead. Only one of the vendors should sign the submission, which would be the same one that will sign the contract with or accept the purchase order from the Province if the submission is successful. Submissions may be rejected if the Province cannot determine who the lead is.