You’re reviewing an opportunity and doing the math.
Two weeks to submit a bid. Evaluation could run for a couple of months. Even after the award, onboarding may push the real start date out again.
So the practical question becomes clear. When does the first payment actually land?
Federal contracts run on a documented schedule. Award timelines take time, invoices move through acceptance, and changes to scope require formal approval. Even closeout continues after performance ends. None of that is unusual. The real issue is building your business for a commercial pace and expecting federal work to run the same way.
When you plan for the timeline, you stop making decisions in the dark. Cash flow forecasts get clearer, staffing stays steadier, and your pursuit list gets more selective. That focus protects profit by reducing wasted proposal time.
Start with timing. It’s the piece that usually gets underestimated.
Most competitive procurements give you a response window that often falls in the 30 to 45-day range. After proposals are submitted, evaluation commonly runs 60 to 90 days or longer, depending on complexity. If a bid protest is filed, award timing can extend further. At the Government Accountability Office level, protest decisions are typically due within 100 days.
In many cases, you’re looking at a three to six-month span from release to award. Some smaller buys move faster, and complex requirements can take longer. Either way, treat the start as a window, not a day on the calendar.
A three-to-six-month award window changes what “ready” means. Hiring based on a hoped-for award date can put you ahead of revenue. Waiting until the award can put you behind in delivery. Planning around the likely start window lets you choose the least disruptive option.
It also clarifies what should stay in motion while you wait. For many businesses, that means keeping commercial work running or pursuing smaller federal buys that can bridge timing. The goal is steady effort on better-fit pursuits, so your time and capacity stay aligned with realistic start dates.
Once you’ve planned for the award window, you still have to plan for the first payment.
Federal Prompt Payment rules generally require agencies to pay within 30 days of receiving a proper invoice. A proper invoice is one the agency can accept as correct under your contract and its billing requirements. If an invoice is rejected and has to be corrected and resubmitted, timing can restart based on the corrected version.
That’s why payment can feel slow even when performance is solid. Costs show up before cash, and the first payment depends on two things being true. Work has to be accepted, and the invoice has to be accepted as proper.
When you include those acceptance and review steps, 45 to 60 days from cost outlay to cash in hand is a common planning range for many small contractors.
Most avoidable delays come from invoice rework. A small mismatch creates questions, questions create resubmissions, and the timeline stretches.
The fix is consistency. Build one invoice package that matches the contract and the agency’s billing requirements, and use it every time. When line items match what was accepted, and the backup is complete, you spend less time fixing invoices and more time running the work.
Now you can make one clean planning decision. Can your business carry payroll, overhead, and project costs for the cost-to-cash window you just mapped?
Financial runway is simply the cushion that lets you operate through that period without forcing rushed hiring decisions, delayed purchasing, or chasing only the shortest-billing work. Runway can be cash on hand, available credit, or a mix that fits your risk comfort and contract mix.
A common planning target is 45 to 60 days of operating expenses available before you scale federal work. That’s not a government requirement. It’s a practical buffer that helps you stay steady while timelines play out the way they usually do.
Once the runway is in place, the next lever is pipeline timing. A predictable pursuit calendar keeps you from depending on one award or one payment to carry the quarter.
Once you can carry the cost-to-cash window, the next question is what carries the months between awards.
Federal pursuits don’t land on a clean schedule, so relying on one opportunity at a time usually creates gaps. A calendar-based pipeline keeps multiple opportunities moving in parallel, each at a different point in the cycle. One is being built, one is under review, and one is positioned for the next quarter.
That coverage changes how you decide. You start choosing what to pursue based on timing and fit, not just interest. Hiring and teaming become planned moves instead of reactions, and commercial work stays in the mix when it serves a clear purpose.
This is where profit becomes practical. Fewer mismatched pursuits means less wasted proposal time, and a steadier pipeline makes capacity planning easier quarter to quarter.
Federal projects don’t just move from start to finish. They move through documentation checkpoints while you work, and again after you finish.
There are two areas new contractors should look out for. The first is a contract change. In commercial work, the scope can shift with a call or an email. In federal work, changes typically have to be issued in writing by the contracting officer, and they become part of the official contract file.
The second is closeout. Even after the last deliverable is submitted, there is still administrative work to finalize the file, confirm billing, and complete the performance record. That performance record is usually documented through the Contractor Performance Assessment Reporting System, often within a set period after completion.
When documentation stays current, changes are easier to price and approve, invoicing is easier to support, and closeout is less time-consuming.
Under FAR Part 43, only a contracting officer can authorize binding changes, and those changes must be documented. Informal direction does not modify the contract. Track changes as they happen and keep your records organized during performance. When a modification is needed, you can support it without rebuilding the story. When closeout arrives, it feels like a wrap-up, not a cleanup project.
You’ve seen what drives the timing. Now make it usable.
Pick one opportunity you’d actually pursue. Write down three dates on one page: when you’ll submit, the earliest realistic start, and when you can reasonably expect the first payment. Then compare that to payroll and overhead for the same period.
If you want help strength-testing those assumptions before you scale up bids or staffing, USFCR can walk through the timeline with you and help you turn it into a plan you can run.
Does the government always pay in 30 days?
Federal rules generally require payment within 30 days of receipt of a proper invoice under Prompt Payment requirements. If an invoice is rejected as improper, resubmission can restart the timing. First invoices may take longer due to validation and onboarding steps.
What if payment exceeds 30 days?
Interest penalties can apply under Prompt Payment rules when payment exceeds the regulatory timeline. Many perceived delays trace back to acceptance steps or invoice corrections rather than missed statutory deadlines.
Can I negotiate faster payments?
Payment timing is usually standardized, though some contract structures allow progress payments under specific provisions. Availability depends on the requirement and agency approach.
How long can protests delay awards?
GAO protests are typically resolved within 100 days. Depending on the situation, the process can pause the award or performance.
Should I create a separate legal entity for federal work?
Some businesses do it for accounting clarity or risk separation, but it adds administrative complexity. Many firms begin with separate financial tracking and reassess their structure as federal revenue stabilizes.