What are WRAP rates and why do they matter?
A WRAP rate is the multiplier companies apply to direct labor, to recoup indirect costs (Fringe, Overhead, and G&A) incurred while running a business. When WRAP rates are applied to direct labor rates to price a proposal, the resulting fully-loaded rates are the break-even point between loss and profitability. Consequently, WRAP rates represent a company’s natural bidding position, and by knowing the competitor’s position and impact on their price, bidders can confidently make pricing decisions.
McNulty WRAP Rate Analyses estimate the Fringe, Overhead, G&A and Total WRAP a Competitor will use to bid on government contracts. We use very sophisticated proven analysis techniques and algorithms, to forecast WRAPs used in increasingly competitive cases. The models work for Public and Private companies, and for virtually any P&L Center or location. We have further improved our analysis to tease out the difference between Services and Development WRAP pools at each location. We also estimate Manufacturing WRAP pools.
How current are they?
WRAP rates change every year, so it’s important to use current WRAPs. We maintain a library of hundreds of Competitor WRAP Analyses and update them each year. When you buy a WRAP rate from us, we guarantee that it was updated within 1 year, if not more recently. We can’t possibly maintain every prime contractor and bidding entity’s WRAP so, if we don’t have the one you are looking for, we’ll build the needed WRAP analysis within one week.
How do we know they’re accurate?
Our clients tell us. When companies buy their own WRAP analysis, often to put us to the test, they tell us we are too close for comfort and then go on to purchase their competitors’ WRAPs. This, more than anything, is a testament to the accuracy of our analysis. We also use these WRAPs in our Price to Win practice. When we overhauled our WRAP analysis capability in 2013, our bid price forecasts markedly improved and our margin of error was cut in half.