February

2016 Issue #15

The Soter Group

How are football, the Super Bowl, and Federal government contracting related? How well
do you perform over the four quarters of your sales season?
Federal Government Contract Spending by Quarter: Fiscal Year 2015
Super Bowl 50 is right around the corner, and the two teams, the Denver Broncos and the Carolina
Panthers, had similar performances throughout the sixteen (16) game regular season. Many coaches
break the NFL season down into four quarters, much like each individual game. Here are the win-loss
records for the two Super Bowl teams:

Denver Broncos

Carolina Panthers

1st Quarter

4 0

4 0

2nd Quarter

3 1

4 0

3rd Quarter

3 1

4 0

4th Quarter

2 2

3 1

Regular Season Total

12 4

15 1

This years Super Bowl-bound teams had relatively balanced approaches to winning throughout the
season. Their respective fourth quarters were their weakest, but their wins through the first three
quarters of the year preserved their playoff spots and their home field advantage positions for a race to
the Super Bowl. Do Federal contractors and vendors need a race or game strategy for the four quarters
of the Federal fiscal year?
There are three basic race strategies: (1) positive split sprint and hope you can hold on; (2) negative
split start off easy and come home strong at the end; and (3) even split hold a steady pace the entire
way. While these concepts generally apply to sports, perhaps this is a good analogy for looking at the
Federal contracting environment.
Many of you can probably relate to the mad dash that occurs every September or even September 30th
(perhaps this is the Super Bowl of Federal contracting) to push last-minute paperwork through and to
use up year-end money. This end-of-year exercise is not only important for Federal departments and
agencies to justify future-year budgets, but also vital for Federal contractor sales and business
development teams to meet annual targets and quotas. While this stereotypical negative split
contracting dynamic may certainly pertain to specific Federal departments, agencies, or programs and
to some extent has been amplified by the prevalence of continuing resolutions it is far from being a
fact that can be applied indiscriminately across the entire Federal government.

1100 North Glebe Road, Suite 1010, Arlington, VA 22201 | Tel: 703.224.4407 | Fax: 703.224.8001 | info@thesotergroup.com
2016 The Soter Group. All Rights Reserved.

February 2016 Issue #15

The Soter Group

How did the fourth quarter (Q4) pan out across the Federal government in fiscal year (FY) 2015?

Percent of Total CFO Act Agency FY15 Prime Contract ObligaKons in Q4

SBA
State
DOL
HUD
SSA
DOI
USDA
EPA
HHS
OPM
GSA
DOC
USAID
DHS
Educaion
Treasury
DOJ
NSF
DOT
VA
DoD
NRC
NASA
DOE

CFO Act Agency

Average

0%

10%

20%

30%

40%

50%

60%

Three agencies obligated over one-half of their annual prime contract obligations in Q4FY15 the Small
Business Administration (SBA) and the Departments of State and Labor (DOL). Six other agencies
obligated between 40 and 50 percent of their annual total during this final quarter. The governmentwide average (only considering the major, Chief Financial Officers (CFO) Act agencies) was only 31%.
While heavily skewed by the Department of Defense (DoD) and other key agencies with significant
contract spending, such as the Department of Energy (DOE) and the National Aeronautics and Space
Administration (NASA), this figure seems much lower than the annual September rush may lead many to
believe.
Since we are already well into Q2FY16, what did Federal contract activity look like last year?
Whereas DOE came in last in Q4FY15 at only 12% of total annual prime contract obligations, DOE was
first in Q2FY15. The department obligated approximately 48% of their annual total during the three
months of Q2 January, February, and March last year. Eighteen (18) of the twenty-four (24) agencies
were under 25% in Q2FY15, and the CFO Act agency average was only 26%.

1100 North Glebe Road, Suite 1010, Arlington, VA 22201 | Tel: 703.224.4407 | Fax: 703.224.8001 | info@thesotergroup.com
2016 The Soter Group. All Rights Reserved.

February 2016 Issue #15

The Soter Group

Percent of Total CFO Act Agency FY15 Prime Contract ObligaKons in Q2

DOE
NASA
DOT
USAID
DOJ
DoD
GSA
VA
DHS
HHS
Treasury
DOI
DOC
SSA
OPM
EPA
NRC
DOL
Educaion
USDA
State
SBA
NSF
HUD

CFO Act Agency

Average

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

While this analysis is a bit esoteric, if nothing else, it can help manage expectations and help inform the
planning process. These snapshots from the last full fiscal year, while illustrative, are admittedly limited
in value. However, they help precipitate some key questions:

How do these figures fluctuate from year to year? Are they indicative of out-year procurement
cycles?
What do these charts look like when segregated between new versus existing contracts?
Products versus services?
How can understanding Federal agencies spending patterns translate into business
development and sales strategies, plans, and activities?
Are you too narrowly focused on end-of-year spending that you are missing out on other
opportunities?

Ultimately, understanding both the qualitative and quantitative aspects and intricacies of your Federal
customers is essential for success.

1100 North Glebe Road, Suite 1010, Arlington, VA 22201 | Tel: 703.224.4407 | Fax: 703.224.8001 | info@thesotergroup.com
2016 The Soter Group. All Rights Reserved.


The Soter Group

February 2016 Issue #15

About The Soter Group

The Soter Group provides services to both the Federal government and the commercial entities that
support it. Our Commercial Services Division provides market research and assessments, competitive
assessments, business development and sales pipeline support, and strategic advisory services to
commercial clients seeking to enter or grow in the Federal government security market. Justin Taft,
President & CEO, and Peter Wong, Director of Market Research, authored these perspectives. The Soter
Group welcomes the opportunity for our research to be cited in third-party reports. To learn more and
to hire The Soter Group, please visit www.TheSoterGroup.com and/or email info@TheSoterGroup.com.
To access and read all of our free market reports please visit: https://www.scribd.com/thesotergroupllc

1100 North Glebe Road, Suite 1010, Arlington, VA 22201 | Tel: 703.224.4407 | Fax: 703.224.8001 | info@thesotergroup.com
2016 The Soter Group. All Rights Reserved.