Skip to content

Defense Contractor

Find the profit your defense contractor business is leaking.

For government contractors, profit is won or lost in rate recovery, billing speed and labor charging long before an audit comes around. The diagnostic shows where indirect costs, WAWF delays or capture gaps are quietly eroding your margin.

Start the free diagnostic About 12 minutes (or a 4-minute Quick Check) · Results right away · Free

Built for small and mid-sized defense and government contractors

The four leaks we see most in defense contractor

The defense contractor diagnostic adds these industry questions to the core assessment, prices each one against your numbers, and ranks them by what they're worth to fix.

Pricing & Margin

Indirect-rate under-recovery

We ask: Are your indirect rates (fringe, overhead, G&A) current and fully recovered in billing?

A first fix: Recalculate provisional indirect rates on current-year actuals and compare to billed rates.

Cash Flow & Collections

Billing / WAWF delays

We ask: How quickly are invoices submitted in WAWF / PIEE after the billing period closes?

A first fix: Set a 5-day close-to-invoice deadline for every billing period.

Labor & Productivity

Unallowable or mischarged labor

We ask: How accurate is timekeeping to charge numbers (DCAA-compliant)?

A first fix: Run a timekeeping compliance check and retrain staff on daily charging.

Sales & Lead Flow

Pipeline capture discipline

We ask: Do you run a bid/no-bid process with Pwin tracking?

A first fix: Adopt a one-page bid/no-bid scorecard for every RFP.

Finance + operations

Two sides of the same problem.

Government work pays reliably, but only if your accounting can stand up to the contract. Blue Water works on both sides: a fractional CFO who keeps your numbers honest, and an operations team that fixes what those numbers reveal.

Finance · Fractional CFO

What your CFO watches in defense contractor

  • Indirect ratesFringe, overhead and G&A rates you can defend, and whether your bids recover them.
  • Contract profitabilityMargin by contract and task order, including unbilled and unallowable costs.
  • Audit and lender readinessTimekeeping, cost segregation and financials ready for an agency review or a bank.

Operations · Friction & systems

What operations fixes

The four leaks above are where the numbers usually point. Once the monthly review shows which one is costing you most, we fix it at the source: a clear procedure your team follows, a cleaner workflow, and the software you already use connected so nothing gets re-keyed or lost.

Then we track the result in your next month's numbers, so you can see what the fix was worth.

How the two sides work together

The diagnostic scores both sides. You'll see your financial control and operations scores, and which to fix first.

Start the free diagnostic

Plus the six areas every business is scored on

Every diagnostic scores the same six areas, so you can see where defense contractor problems sit next to everyday ones.

  • Cash Flow & CollectionsHow fast you bill and collect, and how much cash is tied up waiting.
  • Pricing & MarginWhether your prices and job costs keep up with what the work really takes.
  • Labor & ProductivityOvertime, idle time and the hours that never turn into revenue.
  • Purchasing & SupplyWhat you buy, what you waste and what walks out the door.
  • Sales & Lead FlowHow many inquiries turn into paying work, and how many slip away.
  • Financial ControlWhether your books are current, reconciled and actually used to run the business.

The defense contractor benchmarks we compare you to

If you leave a figure blank, the diagnostic estimates it from these typical values for defense contractor. Your results show which numbers came from you and which are estimates. In a paid audit, we replace every estimate with your real books.

Gross margin
22%
Payroll share of revenue
45%
Materials / supplies share
25%
Days to get paid (target)
45

Planning assumptions used by our model, not guarantees. See the earnings disclaimer.

Free Friction Diagnostic

Start your defense contractor diagnostic

  • Separate scores for financial control and operations
  • Your estimated annual profit leak, area by area
  • A recommended next step (finance, operations or both) based on your answers
  • A 30-day action plan you can start on today

Your answers go only to Blue Water. We never sell them.

Friction Diagnostic
Defense Contractor
Loading your diagnostic…

Diagnostics for other industries