How to decide whether to bid on a government contract

A practical bid/no-bid check for small contractors: eligibility gates, fit, the incumbent and the competition, time and price, and when to answer an RFI instead of bidding.

Gates first: can you bid at all?

Some questions end the decision before it starts. Check them before anyone writes a page.

Registration: an active SAM.gov registration (with a Unique Entity ID) by the time you submit, and for some agencies by the time offers are due.
Set-aside: if the notice is set aside (small business, 8(a), HUBZone, service-disabled veteran-owned, women-owned), you must qualify, and be small for the notice's NAICS code.
Vehicle: an order under a GSA Schedule, GWAC, IDIQ or BPA is competed only among the vehicle's holders. If you don't hold it, the way in is teaming with a holder, or answering the notice that sets up the vehicle when it is open to new offerors.
Clearances, licenses and certifications the solicitation requires by award (a facility clearance, a state license, CMMC level, ISO certificate).

Fit: have you done this work, for buyers like this?

Evaluators score past performance on contracts similar in scope, size and complexity. Look at the work the notice asks for (the statement of work or performance work statement), not just its NAICS code, and list the contracts you'd point to. A code match alone isn't relevant past performance.

Fit with the buyer counts too: an office that has bought this before, with contracts you can study, is easier to read than one buying it for the first time.

The incumbent and the competition

If the work is a follow-on, someone is doing it now. Find the current contract: its value, end date, options and how many offers it drew. An incumbent that performs well is hard to unseat on a best-value buy; a change in scope, set-aside or contract type is often the opening.

Past awards show how many companies usually compete at that office for that work. A buy that drew one offer last time is different from one that drew twelve.

Time, price and capacity

Time: count the working days to the deadline against what the response needs (volumes, forms, pricing, reviews). A rushed proposal rarely wins.
Price: past awarded values for similar work show the range buyers pay; on a lowest-price-technically-acceptable buy, price decides among acceptable offers.
Capacity: who would write the proposal, and who would do the work if you won, without hurting current customers.

An RFI or sources sought is a different decision

A request for information or sources-sought notice takes no offers. Answering it is cheap and can shape the solicitation, including whether it is set aside: contracting officers use the responses to judge whether enough capable small businesses exist. The question there is whether to respond, not whether to bid.

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Official sources

Questions people ask

What is a bid/no-bid decision?

A short, structured check a company makes before writing a proposal: whether it is eligible, whether the work fits its experience, how strong the competition and incumbent are, and whether it has the time and people to submit a good response.

Should a small business bid on everything it is eligible for?

Usually not. Proposals take real time, and win rates are higher on work that matches your past performance at buyers you know. Most firms do better bidding fewer, better-fitted opportunities.

Is it worth answering a sources-sought notice?

Often yes: it costs little, puts your company in front of the contracting officer, and responses from capable small businesses can lead to a set-aside.

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Updated 2026-10-13. General information, not legal advice; the solicitation and the FAR govern each purchase.