Teaming Agreements Guide 2025: Partnering for Government Contracts
Learn how teaming agreements work in government contracting. Understand prime-sub relationships, joint ventures, teaming arrangement types, and key terms to negotiate.
Quick Answer: What is a Teaming Agreement?
A teaming agreement is a pre-award arrangement between two or more companies to pursue a government contract together. Typically, one company serves as the prime contractor while others become subcontractors. Teaming allows companies to combine capabilities, meet requirements they cannot meet alone, and compete for larger opportunities.
What is Teaming?
Teaming is the process of companies joining forces to pursue government contracts they cannot win alone. It is a strategic business development approach common in federal contracting.
Why Companies Team
Capability Gaps
- • Missing technical expertise
- • Lack of specific certifications
- • Insufficient past performance
- • Geographic limitations
Strategic Reasons
- • Access larger opportunities
- • Meet small business requirements
- • Leverage partner relationships
- • Share risk and investment
Teaming vs. Subcontracting
A teaming agreement is formed before contract award to pursue an opportunity together. A subcontract is formed after the prime wins and needs help performing. Teaming agreements often convert to subcontracts upon award.
Types of Teaming Arrangements
Prime-Subcontractor
Most common arrangement:
- →Prime holds contract with government
- →Subcontractor works under prime
- →Prime responsible for subcontractor performance
- →Work share typically negotiated in teaming agreement
Joint Venture
Separate legal entity formed by partners:
- →JV itself holds the contract
- →Members share control and risk
- →Required for some set-aside programs
- →More complex to form and manage
Mentor-Protege JV
Special joint venture under SBA Mentor-Protege program:
- →Large mentor partners with small protege
- →JV maintains protege small business status
- →Can bid on small business set-asides
- →Requires SBA approval
Contractor Team Arrangement (CTA)
Common on GSA Schedule contracts:
- →Multiple Schedule holders team on orders
- →Each provides portion under own contract
- →Team lead coordinates overall delivery
Key Agreement Terms
Essential Provisions
Work Share
Define specific tasks or percentage of work each party will perform. Be specific—vague work share leads to disputes.
Exclusivity
Will parties work exclusively together on this opportunity? Can they team with competitors on the same bid?
Proposal Costs
Who pays for proposal development? Typically each party bears own costs, but large efforts may require cost sharing.
Proprietary Information
Protect confidential information shared during teaming. Include NDA provisions or reference separate NDA.
Subcontract Terms
Define key subcontract terms in advance—rates, payment terms, flow-down clauses. Negotiating later is harder.
Termination
When and how can parties exit? What happens to proposal investment? Address no-award scenario.
Finding Team Partners
Where to Find Partners
- 1.Industry Days: Agency-hosted events for upcoming procurements
- 2.DSBS (Dynamic Small Business Search): SBA database of small businesses
- 3.GSA eLibrary: Find Schedule holders by category
- 4.Trade Associations: Industry groups and networking events
- 5.Incumbent Contractors: Look at current contract holders in FPDS
- 6.Past Partners: Companies you have worked with successfully
Partner Evaluation Criteria
Fill your gaps
Relevant experience
Can sustain performance
Work style compatibility
8(a), SDVOSB, etc.
Agency connections
Negotiation Tips
Tip 1: Define Work Share Early
Agree on specific percentages and tasks before investing significant proposal effort. Vague commitments lead to disputes when contracts are won.
Tip 2: Address the Subcontract Now
Negotiate key subcontract terms in the teaming agreement. Include rate structures, payment terms, and flow-down requirements. Post-award negotiations are harder.
Tip 3: Consider Multiple Scenarios
What if you win but scope is reduced? What if only some task orders are awarded? Build flexibility into work share arrangements.
Tip 4: Protect Your Information
Include strong confidentiality provisions. What you share during teaming could be used against you if the partnership fails.
Tip 5: Have an Exit Strategy
Define how parties can exit before or after award. Address sunk proposal costs and ongoing obligations.
Teaming Risks
Common Problems
Work Share Disputes
Prime reduces sub work after award. Clear, enforceable work share provisions help.
Partner Performance Issues
Team member cannot deliver as promised. Due diligence and performance guarantees matter.
Proprietary Information Leaks
Shared information used by failed partner on competing bids. Strong NDAs essential.
Slow Payment
Prime delays paying subcontractor. Include payment timing requirements in agreement.
Frequently Asked Questions
Are teaming agreements enforceable?
Courts have varied on enforceability. Many teaming agreements are considered agreements to agree and may not be enforceable. Include specific, binding terms to improve enforceability.
Should I team as prime or sub?
Consider your capabilities, relationships, and risk tolerance. Primes control the bid but bear more risk. Subs have less control but lower investment. Sometimes you prime, sometimes you sub.
How many team members is too many?
Enough to cover requirements without diluting work share. Large teams are hard to manage and may concern evaluators about coordination. Focus on essential capabilities.
Can I be on multiple teams?
Unless you agreed to exclusivity, you can team with multiple primes on different bids. However, check each teaming agreement and consider relationships carefully.
Find Opportunities to Team On
Track contract opportunities that fit your teaming strategy. Find partners and pursue larger contracts with BidFinds.
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