Paper3 - Contract and Pricing Negotiation

Paper 3 – You are the Director in charge of developing a contract-pricing model for a complex project – to modernize U.S. Navy Aircraft Carrier shipboard radar systems. 

Develop a 12-month, high-level pricing plan that proposes 100 employees at these levels and numbers of full time employees (FTEs): 1 Director, 5 Senior Managers, 20 Senior Developer, and 74 Developers. 

Use these base (direct cost rates): Director: $100/hour, Senior Manager: $75/hour, Senior Developer: $65/hour, Developer: $50/hour. The overhead rate is 10%, the G&A rate is 15%, and the permitted fee/profit is 10%. 

With this information, develop the overall costs for the project over the 12 months answering the following questions:

1. Show the cost build for each of the above labor categories, and show the overall cost to the client for each of the four categories as well as the total cost of the combined four categories (this combined cost is the cost that would be presented to the federal client). Include in your cost build-out any Indirect costs that you believe are appropriate/related to this proposal.

2. List all of your assumptions for the costs built into the response to question 1.