The Fixed-Price Margin Squeeze
Engineering executives and government contractors are operating in a hostile matrix of compound cost inflation and draconian federal oversight. Locked into Firm-Fixed-Price (FFP) agreements lacking dynamic Economic Price Adjustment (EPA) automation, you are forced to absorb hyperinflationary material and labor drifts directly against your operating margin. Concurrently, DCAA audits have become merciless. Failing to programmatically segregate unallowable pre-proposal business development time from allowable Bid and Proposal (B&P) labor invites catastrophic FAR and CAS violations. This guarantees retroactive cost disallowances, the destruction of negotiated G&A multipliers, and triggers devastating payment withholding and potential False Claims Act penalties.