The federal government assumes that past performance predicts future results. If you've delivered successfully before, you're more likely to deliver successfully again. This assumption is built into the Federal Acquisition Regulation, which requires agencies to evaluate past performance in most competitive procurements above the simplified acquisition threshold.
For established contractors, a strong track record becomes a durable competitive advantage. For new entrants, the lack of past performance can feel like an impossible barrier. How do you get experience when you need experience to get experience?
This article explains how past performance actually works in federal contracting, what evaluators are looking for, and concrete strategies for building a track record from scratch.
How Past Performance Works in Federal Procurement
The Legal Framework
FAR Subpart 15.3 establishes past performance as a mandatory evaluation factor for negotiated competitive acquisitions above the simplified acquisition threshold (currently $250,000). Contracting officers must consider past performance unless they document why it isn't appropriate for a specific acquisition.
The regulation tells evaluators to consider the contractor's record of conforming to contract requirements, standards of good workmanship, forecasting and controlling costs (for cost-type contracts), adherence to schedules including administrative aspects, history of reasonable and cooperative behavior, commitment to customer satisfaction, and business-like concern for the customer's interests.
This isn't just about whether you delivered the work. It's about how you delivered it. A contractor who met every technical requirement but was difficult to work with, unresponsive to communications, or constantly behind schedule will not fare well in past performance evaluations.
CPARS: The Official Record
The Contractor Performance Assessment Reporting System (CPARS) is the government's official database for contractor performance information. Contracting officers are required to prepare past performance evaluations at least annually for contracts above certain thresholds, and at contract completion.
CPARS evaluation thresholds are $250,000+ for general contracts, $35,000+ for architect-engineer contracts, and $750,000+ for construction contracts.
| Evaluation Area | What It Covers |
|---|---|
| Quality | Technical quality of products or services delivered |
| Schedule | Timeliness of performance, including milestones |
| Cost Control | Accuracy of estimates, cost management (cost-type contracts) |
| Management | Business relations, personnel, communication |
| Small Business | Achievement of small business subcontracting goals |
| Regulatory | Compliance with applicable regulations |
| Other | Contract-specific factors |
Each factor receives one of five ratings:
| Rating | Description |
|---|---|
| Exceptional | Performance significantly exceeds contract requirements to the government's benefit. No significant weaknesses identified. |
| Very Good | Performance exceeds some contract requirements to the government's benefit. Minor problems were effectively corrected. |
| Satisfactory | Performance meets contract requirements. Minor problems were addressed satisfactorily. |
| Marginal | Performance does not meet some contract requirements. Corrective actions may not be timely or effective. |
| Unsatisfactory | Performance does not meet most contract requirements. Serious problems exist, and corrective actions appear ineffective. |
How Evaluators Use Past Performance
Source selection teams don't just count ratings. They assess relevance, recency, and the narrative behind the numbers.
Relevance: Was the prior work similar in scope, complexity, magnitude, and contract type to what's being proposed? A contractor with excellent past performance on small IT helpdesk contracts may not receive credit for that experience when bidding on a large systems integration project.
Recency: Per FAR, agencies can use past performance information within three years of contract completion (six years for construction and architect-engineer contracts). Older performance fades from consideration.
Context: Evaluators read the narratives, not just the ratings. A 'Satisfactory' rating with a narrative explaining that the contractor dealt professionally with unforeseen circumstances may be viewed more favorably than a 'Very Good' rating on a straightforward contract.
Trends: Is performance improving or declining? A contractor showing consistent improvement may be viewed more favorably than one with erratic ratings.
The 'No Past Performance' Problem
New contractors face a genuine challenge. The FAR requires consideration of past performance, but you can't have federal past performance until you've performed federal contracts.
Here's what the regulation actually says about contractors without a record:
'In the case of an offeror without a record of relevant past performance or for whom information on past performance is not available, the offeror may not be evaluated favorably or unfavorably on past performance.' (FAR 15.305(a)(2)(iv))
This means a lack of past performance is supposed to be neutral, not negative. In practice, however, competitors with strong track records still hold an advantage. Evaluators naturally prefer known quantities over unknowns.
Building Past Performance: Practical Strategies
1. Start with Simplified Acquisitions
Contracts under the simplified acquisition threshold ($250,000) often don't require formal past performance evaluations. Many are awarded based primarily on price and basic capability.
Micro-purchases (under $10,000) and small purchases (under $250,000) are entry points where your lack of federal track record is less penalizing. Focus on these early to establish relationships and begin building a performance history.
Even though these contracts may not generate CPARS reports, they create documented federal experience you can cite in future proposals.
2. Use Commercial Past Performance
The FAR explicitly allows agencies to consider commercial (non-government) past performance when relevant. From FAR 15.305(a)(2):
'The evaluation should take into account past performance information regarding predecessor companies, key personnel who have relevant experience, or subcontractors that will perform major or critical aspects of the requirement when such information is relevant to the instant acquisition.'
When submitting proposals, present your commercial experience in a way that demonstrates relevance to federal requirements. Translate commercial metrics into government-relevant terms. Emphasize contract management practices, quality controls, and customer satisfaction. Include references who can speak to your reliability and professionalism. Highlight work with regulated industries or environments similar to government.
The key is making it easy for evaluators to see the connection between what you've done commercially and what the contract requires.
3. Subcontract Before You Prime
Subcontracting under an experienced prime contractor is one of the most common paths to federal past performance.
Benefits of subcontracting include gaining federal contract experience without full prime contractor risk, learning government processes, compliance requirements, and customer expectations, building relationships with agencies and contracting officers, and the prime contractor may provide a reference for future opportunities.
Where to find subcontracting opportunities: SBA's SubNet database, prime contractor small business liaison offices, agency-hosted industry days and matchmaking events, and direct outreach to primes working in your capability area.
Important consideration: Under SBA regulations (13 CFR 125.2), when a small business prime contractor proposes with small business subcontractors and the prime lacks relevant past performance, agencies must consider the first-tier subcontractors' past performance as if it were the prime's. This regulation can be valuable if you're teaming with an experienced subcontractor.
4. Pursue Set-Asides Strategically
Small business set-aside programs exist partly to address the past performance barrier. When competing only against other small businesses, you're more likely to face competitors with similar experience levels rather than established large contractors.
Set-aside categories include Small Business set-asides, 8(a) Business Development Program, HUBZone, Service-Disabled Veteran-Owned Small Business (SDVOSB), and Women-Owned Small Business (WOSB).
Some set-asides, particularly 8(a) sole-source contracts, may be awarded with minimal competition, giving new contractors a path to their first prime contract.
5. Leverage Key Personnel Experience
Even if your company is new, your people may have extensive relevant experience. FAR 15.305 explicitly mentions key personnel as a source of past performance information.
When your company lacks an organizational track record, identify key personnel who will work on the contract, document their individual past performance on relevant projects, include their roles, responsibilities, and achievements, and explain how their experience will directly benefit contract performance.
This approach works best when the key personnel will have meaningful involvement in the work, not just nominal titles.
6. Form Joint Ventures or Mentor-Protégé Relationships
Joint ventures allow you to combine capabilities with an experienced partner. Under certain circumstances, the joint venture can cite the past performance of its members.
The SBA Mentor-Protégé program pairs small businesses with experienced mentors who provide guidance, resources, and sometimes teaming opportunities. Performance on mentor-protégé joint venture contracts can build the protégé's independent track record over time.
7. Target 'No Past Performance Required' Opportunities
Some solicitations explicitly state that past performance is not an evaluation factor or assign it minimal weight. These are often Lowest Price Technically Acceptable (LPTA) procurements, commercial item acquisitions with straightforward requirements, or contracts where technical approach or price dominates evaluation.
Search for solicitations where Section M (Evaluation Criteria) indicates past performance is not evaluated or is significantly less weighted than technical and price factors.
Protecting Your Past Performance Record
Once you have federal contracts, protecting your CPARS ratings becomes a priority.
During Contract Performance
Communicate proactively. Problems are inevitable. How you handle them determines your rating. Notify the contracting officer early when issues arise, along with your mitigation plan.
Document everything. Keep records of deliverables, communications, approvals, and change requests. If a dispute arises later, documentation protects you.
Monitor your own performance. Don't wait for the annual evaluation to learn you have problems. Track your own metrics and address issues before they appear in CPARS.
Build relationships with CORs and program managers. The people who evaluate you are the people you work with daily. Professional, responsive behavior throughout the contract period matters.
Responding to CPARS Evaluations
When you receive a CPARS evaluation notice, you have 14 calendar days to review and respond. Use this time wisely.
If the evaluation is positive, review it anyway. Ensure the narrative accurately captures your achievements. A strong narrative supports future proposals.
If the evaluation contains concerns, review the supporting documentation and facts, prepare a professional, factual response (not defensive or emotional), provide additional context or documentation the evaluator may have lacked, and if factual errors exist, clearly identify them with supporting evidence.
Important: Marginal and Unsatisfactory ratings are rare (under 2% of evaluations). But a single negative rating can follow you for years. Take the response process seriously.
Past Performance in Proposal Writing
When writing the past performance volume of a proposal:
Match requirements to experience. Don't just list past contracts. Show how each cited project is relevant to the current requirement in terms of scope, complexity, size, and contract type.
Provide complete reference information. Include contract numbers, period of performance, contract value, contracting officer name and contact information. Make verification easy.
Include subcontractor and key personnel experience when your organizational past performance is thin. Make the relevance explicit.
Address gaps honestly. If you lack directly relevant experience, acknowledge it and explain what compensating factors (commercial experience, key personnel, teaming partners) reduce risk.
Stay within page limits. Don't pad with marginally relevant contracts. Quality and relevance matter more than quantity.
The Long Game
Building a strong past performance record is a multi-year effort. The contractors with the best records didn't get there by accident. They pursue contracts they can perform well, not just contracts they can win. They invest in performance quality, not just proposal quality. They treat every contract as an audition for the next one. They manage customer relationships throughout performance, not just at award. They address problems proactively rather than hiding them. They take CPARS seriously as a long-term strategic asset.
A single contract with an Exceptional rating is worth more than five contracts with Satisfactory ratings. Build your track record deliberately.
Conclusion
Past performance requirements create real barriers for new federal contractors, but they're not insurmountable. The path typically involves starting small, using commercial experience strategically, building through subcontracting, and gradually establishing a prime contractor track record.
Once you have federal past performance, protecting it becomes a business priority. Strong CPARS ratings compound over time, making each subsequent pursuit easier. Weak ratings do the opposite.
The contractors who succeed treat past performance as an asset to build and protect, not just a box to check on proposals.
BidClever's BI and Analytics module helps contractors identify potential teaming partners with complementary past performance. When you need specific agency experience or technical credentials to strengthen a bid, search by NAICS code, agency, contract vehicle, or capability area to find partners who can fill your gaps.