On Wednesday, May 6, 2020, at 2:00 ET, US Federal Contractor Registration (USFCR) Academy will host a live webinar on the signature page vs. the standard form. Sign up here and get a head start with this blog post.
On Thursday, April 30, 2020 at 11:00 am ET USFCR Academy will host a live webinar about the Simplified Acquisition Program. Sign up for the webinar and learn more about simplified acquisition procedures in this blog post.
This article was last updated on May 10th, 2023
Once a business locates a solicitation that aligns with its capabilities, the task of crafting a well-structured response in the form of a proposal begins. If you find starting your proposal challenging, you can connect with experts who can guide you.
Editor's Note: This post was originally published in 2020 and has been updated for accuracy and comprehensiveness as of July 2023.
The Federal Acquisition Regulations (FAR) lay the groundwork for how government solicitations and contracts are put together. And while it's true that the FAR is mainly written with government officials in mind - the ones crafting the contracts - it's a mistake for businesses to gloss over them.
After all, these regulations aren't just about compliance. Having a firm grasp of the FAR can tilt the scales in your favor in government contracting.
Originally published in March 2020. Updated in April 2024 to reflect the latest standards and practices.
Start Embark on your federal contracting journey with confidence. This guide offers a clear, practical understanding of the Federal Acquisition Regulation (FAR) and the Defense Federal Acquisition Regulation Supplement (DFARS). Master these regulations to ensure compliance and secure a strategic advantage in the competitive federal marketplace.
1. What is FAR? The Backbone of Government Procurement
FAR governs all procurement processes within federal agencies, ensuring fairness, transparency, and efficiency. Understanding FAR is not just necessary—it’s a strategic advantage.
Understanding FAR's Structure:
FAR is a detailed document comprising 53 parts, each addressing different aspects of procurement. It's akin to a rulebook – knowing it can be the difference between success and missed opportunities. Each part addresses specific procurement activities, from acquisition planning and contracting methods to labor laws and contract management.
Key Sections:
- Acquisition Planning (Part 7)
- Contracting Methods and Contract Types (Parts 13-16)
- Socioeconomic Programs (Part 19)
Importance:
Grasping FAR's nuances prevents legal issues and enhances your bidding success. Every federal contract incorporates FAR clauses; knowing these can be your edge in winning and managing contracts effectively.
2. What is DFARS? Customized Guidance for Defense Contracts
While FAR applies to all federal acquisitions, DFARS specifies contract requirements with the Department of Defense, addressing unique aspects of defense procurement.
Understanding DFARS is important for anyone looking to engage in defense contracting. It includes additional protections against cybersecurity threats and regulations on the source of materials.
3. Strategic Advantages of Knowing FAR and DFARS
Knowledge of these regulations does more than keep you compliant; it positions your business strategically for:
- Risk Management: Navigate legal complexities with ease.
- Competitive Bidding: Leverage insights from FAR and DFARS to submit compelling and compliant bids.
- Operational Efficiency: Streamline processes by understanding regulatory requirements upfront.
- Engagement Question: Have challenges with FAR or DFARS held back your contracting opportunities? Share your experiences below.
4. FAQs About FAR and DFARS
What are the most common FAR clauses in contracts?
FAR clauses are integral to all federal procurement contracts, ensuring compliance, fairness, and transparency. Some of the most frequently encountered FAR clauses include:
- FAR 52.212-4, Contract Terms and Conditions—Commercial Items: This clause is commonly applied in contracts involving commercial items and outlines the terms and conditions specific to such acquisitions.
- FAR 52.219-8, Utilization of Small Business Concerns: This clause encourages the use of small businesses within the supply chain.
- FAR 52.222-26, Equal Opportunity: It ensures that contractors do not discriminate against employees or applicants for employment based on race, color, religion, sex, or national origin.
- FAR 52.243-1, Changes—Fixed Price: This clause provides the government the right to make work changes with appropriate contract price or terms adjustments.
These clauses represent just a few examples, highlighting the regulatory scope contractors must navigate in federal contracts.
How do I ensure my business is DFARS compliant?
Ensuring DFARS compliance involves several key steps:
- Understand the Relevant Clauses: Familiarize yourself with the specific DFARS clauses that apply to your contracts, such as those related to cybersecurity (e.g., DFARS 252.204-7012) or the sourcing of materials (e.g., DFARS 252.225-7001).
- Implement Required Policies and Procedures: Depending on the clause, you may need to implement specific policies, such as for IT security, to protect covered defense information.
- Regular Training: Conduct regular training for your employees to ensure they understand and can implement DFARS requirements effectively.
- Audit and Monitor Compliance: Regular audits, both internal and external, can help ensure that compliance measures are being followed and are effective.
- Seek Expert Guidance: Given the complexities of DFARS, consulting with experts, such as those at USFCR, can provide tailored advice and solutions to meet compliance requirements.
What is the significance of FAR Part 12 (Acquisition of Commercial Items)?
FAR Part 12 governs the acquisition of commercial items, offering a streamlined process that simplifies the procurement procedures for items available in the commercial marketplace. This part is significant because:
- Efficiency and Flexibility: Federal agencies can acquire commercially available products and services quickly and efficiently, using terms and conditions more aligned with commercial practices.
- Cost Savings: By leveraging commercial items, the government can reduce costs, as these items are usually priced through competitive market forces.
- Innovation Access: It provides the government with easier access to innovative technologies and products developed in the commercial sector, enhancing the capabilities of government operations.
For detailed exploration, check out The Ultimate Guide to The FAR.
Understanding FAR and DFARS is more than a regulatory requirement—a significant competitive advantage in federal contracting. Equip yourself with this knowledge, and you're compliant and ahead of the game.
On this week of USFCR Academy Live, we're covering FAR Part 52. This section includes the Buy American Act. You can sign up to attend on our webinar page and learn more about the Buy American Act in this blog post.
You have a unique edge in federal contracting as a Women-Owned Small Business (WOSB) or an Economically-Disadvantaged Women-Owned Small Business (EDWOSB). These certifications can open doors to lucrative contracts by reducing competition and giving you preferred status with federal agencies.
It's no secret that women entrepreneurs have been historically underrepresented. The ED/WOSB program is designed to turn the tide, but the process can be tricky. Once certified, finding the right contracts amidst the flood of daily solicitations can feel like searching for a needle in a haystack.
Each year, the federal government aims to allocate approximately 23% of its total contracting budget to small businesses, with separate goals established for specific types of small businesses.
These specific types are commonly referred to as "set-asides," as the government reserves a certain percentage of their spending for these businesses.
Small business set-asides, as defined in FAR 19.5:
"The purpose of small business set-asides is to award certain acquisitions exclusively to small business concerns. A 'set-aside for small business' is the reserving of an acquisition exclusively for participation by small business concerns. A small business set-aside may be open to all small businesses. A small business set-aside of a single acquisition or a class of acquisitions may be total or partial."
On this week's episode of USFCR Academy Live, we're covering subcontracting. Join us on Wednesday, 2/26, at 2 PM ET by signing up on our webinar page.
