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How to Create a Clear, Concise & Dynamic Capability Statement for your Government Contracting Business

A good capability statement is equal parts marketing document and company biography. It’s not unlike a dating profile; you want to give the contracting professional key information they’ll use to decide whether to swipe left or swipe right on your business. 

When written with purpose, a clear, concise and dynamic capability statement presents your business specifically for government contracting professionals who are doing market research. While relationships and networking matter for public sector business development, you must make sure your company details are discoverable and digestible when potential customers are researching new businesses for upcoming contracts. 

So what are the elements that every capability statement needs to have? Let’s answer that question by describing why a government capability statement is important, reviewing everything that should be included, and guiding you through the creation of your very own dynamic capability statement. Here’s what we’ll cover:

  • Why You Must Have a Government Capability Statement
  • Elements of a Clear, Concise & Dynamic Capability Statement
  • How to Create a Government Capability Statement for your Business

Why You Must Have a Government Capability Statement

A clear, concise and dynamic capability statement presents highly relevant information about your business in a single, easy-to-digest page. Government buyers won’t give you a contract based on what’s in it, but they may determine that your company is eligible for a small business set-aside and add you to a list of possible sources. Or they may see from your capabilities that you could satisfy a contract and send you a formal Request for Information or Sources Sought notice in hopes that you’ll participate in a future competition.

You need a clear and concise capability statement you can readily share, not just with government folks but with potential teaming partners as well. In the process-driven sales cycle of public procurement, information like whether your business has a particular socioeconomic designation or resells a particular manufacturer’s product, can mean the difference between getting a follow up call or being excluded from consideration. 

So they’re more than just a business card; a capability statement is more like a cover letter inviting additional consideration of your company. A government contracting professional may keep a file of capability statements for strategic market research, especially if they are exploring an entire industry. A teaming partner may want to identify all of the small businesses that have a specific capability, product, or socioeconomic designation for the purposes of future subcontracting.

Regardless of the purpose, having a capability statement readily available can lead to a future conversation. Not all of these transactions will lead to business – in fact, few of them will – but exactly zero of them will convert if you don’t have a good capability statement. So let’s look at what goes into this important document.

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Elements of a Clear, Concise & Dynamic Capability Statement

A capability statement is a snapshot of your business that communicates the products and services you provide and key demographic information that is pertinent to government buyers and teaming partners. A more mature business might have a capability statement for every line of business they operate. If you’re just getting started, one capability statement will suffice, but there is no rule against creating new ones in the future and updating them as your business evolves. Just make sure your version(s) includes all of the following information, and it will serve the purpose.

Element Description & Why It’s Important
Company Name Use the business name that corresponds to your registration (Haven’t done this yet? Check out this Guide to SAM Registration). 

You may want to include a tag line, slogan or any brand messaging here, but keep it to one line or two.

Summary Description Succinctly describe your company in two or three sentences.
Core Capabilities This isn’t your mission statement or reason for doing business, but a few high level bullet points that effectively communicates what you do best as a business.
Major Service Offerings This section is more applicable for larger businesses that may have multiple service lines (e.g., facilities management, janitorial services, and security details), but you can use it to categorize the services you provide.
Small Business Certifications If you are a small disadvantaged business that qualifies under one of four contracting assistance programs, list them here. If you are a small business but don’t qualify as disadvantaged, we still recommend you indicate your size status as a small business. It never hurts!
Contracting Vehicles Government contracting vehicles like the GSA Schedule are essentially catalogs, and earning a spot on them is a big deal. It makes it easier for contracting professionals to buy from you, so if you have one (or many) you should absolutely list them here.

Search government contracting vehicles by keyword.

Business Certifications If you or your business has any particular certification or business license, list it here. Include things like authorized reseller certifications, approved vendor seals, or industry certifications like ISO or ANSI.
Past Experience Include any past clients you have served. Obviously the goal is to have government client experience, but not every new business will have won their first contract yet. If you have any transactional history or record of prior performance for any client, list it here so interested parties will regard you as a viable business entity.
Commodity Codes (NAICS, PSC, or NIGP) Commodity codes in government contracting include the North American Industry Classification System (NAICS), Product Service Codes (PSC), or National Institute of Government Procurement (NIGP) codes. NAICS codes are a broad classification system, but their utility for government contracting is to determine the threshold for small and “other than small” businesses (expressed in terms of either number of employees or annual revenues). 

PSC and NIGP codes are used to further categorize the goods and services purchased by the federal government (which uses PSC) or state and local governments (which use NIGP codes) to help administrators and the public better track public expenditures.

All three are used in market research, and you’ll want to include as many as are relevant to your business in the capability statement. 

Search government commodity codes by keyword.

Personnel or Business Clearances Security clearances that you or any employees hold, including facility clearances if applicable to your business, can be quite valuable. They’re also expensive to acquire, so if you do have them you will absolutely want to include them here.
General Business Information You’ll want a quick reference box somewhere on your capability statement that includes demographic information such as:
  • Registered company name (important for contracting professionals who want to find you in the System for Award Management, or SAM, database)
  • Doing Business As name
  • Year of incorporation
  • Corporation Type
  • DUNS Number
  • CAGE Code
  • Link to your website or online GovShop profile

How to Create a Government Capability Statement for your Business

Now that you know the basic elements every capability statement needs to include, you can begin the design process of laying out this information in a visually appealing manner. You don’t need to be intimidated by this process, as a clear and concise document is more important than how it looks.

Here are some general guidelines to follow when creating your government capability statement.

  • Give it some visual appeal. Government contracting professionals and potential teaming partners see hundreds of these things, and if you can make yours stand out from the crowd, it will increase your chances of it being recalled at a later time.
  • Stick to one page. You can have a front and a back, but if you find yourself needing more pages then you aren’t following our recommendation of keeping it concise.
  • Use organizing elements like bullets, tables, and featured sections. These techniques will make your capability statement more readable, which is important; as we said, people get these all the time and you need to make yours easy enough to be scanned so the trained eye can see what they’re looking for in each statement (e.g., size standard, past experience, certifications).
  • Carefully proofread your document. This is not the place to make a silly or careless mistake. An error on such an important document will call into question your credibility and attention to detail, and it’s not the type of first impression you want to make.

Before you go into the design and layout of your capability statement, just create a simple word document covering each of the sections. Use bullet points to add detail, and then ask a peer (preferably outside of your company) to read it and provide feedback. This is important because you may be so engrossed in the creation process that you miss obvious issues or gaps in the information you provide.

Once you’ve completed this peer review process, you are ready to design a professional capability statement that will put your business in position to succeed. We offer a range of capability statement templates that you can download and use for your business. Or consider our capability statement design service which is offered as part of our Starter GovShop subscription.

Create a Digital Version of your Capability Statement

Most importantly, after you create the hard copy you will want to make it digitally available. Some companies will offer it as a downloadable on their website, but a better alternative is to actually create a digital version that is searchable for government contracting professionals and prospective teaming partners.

We created GovShop expressly for this purpose. Create a free account and company profile, and use the information on your capability statement to fill out each section of your profile. Doing so will help introduce your company to thousands of prospective clients who use GovShop every day to conduct government market research.

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