Let’s assume you work for a small company that wants to grow the business by soliciting subcontracts from a major prime contractor. What unknown risks might be in store for your company in pursuing this path? Here are some of those risks, along with a personal example and eight suggestions for mitigating them.

Unknown risks

A prime contractor must outsource most of its work to be competitive. It’s always on the lookout for hidden vendor jewels that are low cost, have excellent capability, offer a quality product, and maintain an on-time delivery track record. If the vendor performs well, the prime contractor tends to go back to the vendor repeatedly. It’s a win-win situation for both parties. But if the vendor performs poorly for whatever reason, it’s placed on the prime contractor’s black list, which means it will not use the vendor for future projects in all likelihood.

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