1. Week 10 Assignment – Federal Contracting Activities and Contract Types
The Department of Energy plans to issue a $1,000,000 government contract to a company that specializes in the manufacturing of solar panel systems. As a result, a government auditor has been contacted to examine the operational data of SolarCal and your company in order to decide which company should win the government contract.
Note: You may create and/or make all necessary assumptions needed for the completion of this assignment.
· In order to complete this assignment, refer to Assignment 1 where you discussed SolarCal and your company.
In order to complete this assignment, refer to the scenario in the Introduction of New Solar Company Assignment where you discussed SolarCal and your company, as well as the scenarios and readings from previous weeks.
· Refer to the rubric for this assignment to become familiar with how your paper will be graded.
· Refer to scenarios and readings from previous weeks to complete this assignment.
· Note: It is essential that you review your case analyses when completing this assignment.
Write a 6–8 page paper in which you:
· Create a 1-page overview of the history of SolarCal and Superstar Solar, Inc., the companies competing for the government contract.
· The government is deciding on which contact type it will offer. Discuss firm fixed-price and cost reimbursement contracts and what the preferred preference would be for each company when the government decides on a type. Justify the response.
· The government decided that it will offer a firm-fixed price contract for this project. Discuss the expenses in detail for each company. The following should be included in these costs:
. Direct Costs.
· Indirect Costs.
· Suggest which company should be awarded this government contract based on the data that was presented for each company. Next, provide three to five reasons to support your stance.
· Use at least three quality resources in this assignment. Note: Wikipedia and similar websites do not qualify as quality resources.
· The Strayer University Library is a good source for quality resources. To get started, please refer to the library page for this course.
Your assignment must follow these formatting requirements:
· This course requires the use of Strayer Writing Standards . For assistance and information, please refer to the Strayer Writing Standards link in the left-hand menu of your course. Check with your professor for any additional instructions.
The specific course learning outcome associated with this assignment is:
· Recommend a company for a government contract award based on history and cost considerations related to production.
Running head: SOLAR TECHNOLOGY COMPANY
SOLAR TECHNOLOGY COMPANY
Solar Technology Company
BUS315 Cost and Price Analysis
SuperStar Solar Inc. is an energy company dealing in solar energy distribution. The company was founded mainly to provide solar energy more effectively and efficiently than SolarCal. SuperStar Solar will seek to avail solar energy much more cheaply to the consumers and offer consumers, communities, and the nation generally clean, low-cost, abundant, distributed renewable energy that will allow SuperStar solar to offer financial security to shareholders while giving back to society.
Vision statement: providing the most convincing and unparalleled value in the solar energy industry. Our consumers define value as the design and installation of the highest quality solar systems on time and with a high degree of safety and high consumer satisfaction at lower costs.
The company will provide a wide range of products; however, the main products include CNBM 320W high voltage solar panels. A battery bank, multimode hybrid inverter, solar inverter (AC), and an optional generator accompany these modules.
The key personnel include
Martin- Head of productions
Luke-Head of Accounting Finance
Clarisse- Head of Government contracting.
SuperStar solar is the Department of Housing and Urban Development. This target client base offers the chance and opportunity since it embodies the same values as SuperStar solar. Low-cost housing and benefit to the house owner. To complement affordable housing, there is a need for affordable power, which SuperStar solar is offering to the millions of affordable housing customers across America.
SolarCal is a company that deals in affordable solar energy distribution. The company’s main aim is to sell affordable solar energy to government Departments. The company’s vision is to build the best renewable energy organization in the world.
The mission statement is:
1. Building a world-class portfolio of renewable energy assets and becoming the top company globally
2. Leading the energy transition through the provision of innovative solutions to energy consumers.
3. Maintaining the highest standards of quality and sustainability and acting responsibly.
4. Fostering a culture of trust, collaboration, and high-quality performance to achieve the company goals and become the employer of choice.
The company offers solar pumping solutions to farmers across America. Solar can have a wide range of competitive and high-specification solar pumping systems that are purposefully developed for small-scale and large-scale agriculture and are mainly based on robust submersible solar pumps specifically designed to help PV-powered water supply from dams rivers, wells, and boreholes. The pumps include the following components: grade 1 PV modules with additional connectors to help in installation.
Submersible drop cable is joined with a 10m connection cable for the modules, HDPE pipe connectors, safety rope, and DC solar isolator with MCB control. Module supports and piping are also provided.
Key personnel at SolarCal include:
Dominic- CEO of SolarCal
Jake- Head of Accounting/Finance
Luke- Head of Productions
Melissa- Head of Government Contracting
The target client base is the Department of Agriculture.
Value-based pricing technique means that the company will set the prices based on the benefits provided to the consumer (Faith, 2018).
Competition-based pricing is a technique that allows the company to set prices based on the prices charged by the competitor.
Costs-based pricing: cost of manufacturing serves as the foundation for cost-based pricing techniques, to which a profit margin must be applied to determine the product price (Bösch et al. 2018).
The cost-based pricing strategy best suits SuperStar solar to help market its solar products. The benefit of this method is that the cost of manufacturing serves as the foundation for cost-based pricing techniques, to which a profit margin must be applied to determine the product price ((Bösch et al. 2018; Faith, 2018). Cost-based pricing will allow SuperStar solar to determine a price floor and ceiling based on their costs. The price floor and price ceiling indicate the minimum and maximum pricing values for a certain good or service – the pricing range (Bösch et al. 2018). The optimal course of action for SuperStar solar would be to set a price between the ceiling and the floor. This model allows all price settings to be considered and calculations to determine the prices in a simple manner. According to Darrell Oyer, “Knowing what cost can be claimed is essential in preparing price proposals and indirect cost rate proposals, as well as understanding how profit is affected by unallowable costs.”
Bösch, P. M., Becker, F., Becker, H., & Axhausen, K. W. (2018). Cost-based analysis of autonomous mobility services. Transport Policy, 64, 76-91.
Faith, D. O. (2018). A review of the effect of pricing strategies on the purchase of consumer goods. International Journal of Research in Management, Science & Technology (E-ISSN: 2321-3264) Vol, 2.
Darrell Oyer, Management Concepts Press ( 2011). Pricing and Cost Accounting: A Handbook for Government Contractors: A Handbook for Government Contractors, 53, 277