Has your BD team started saying “after the holidays”? Has your SAM.gov saved search gone quiet? Did your last email to a contracting officer bounce back with an out-of-office reply?
Welcome to Q1 of FY27. This new fiscal year opened on a continuing resolution that keeps agencies funded through December 11. The midterms hit November 3, and the final FY27 funding fight got punted until after the votes are counted. Then you’ve got Thanksgiving and the holidays. For small businesses and new entrants, every instinct says to rest (or hibernate) until spring.
If you’re feeling the urge to power down with agencies, I’d encourage you to step back and take a lesson from bears. The same three bears from my GovCon Goldilocks piece I wrote a while back (I’ll include the link to that article in the comments if you’re interested). Da Bears are back, and their fall routine can be used as a playbook for a slow season.
Here’s the thing, Q1 only appears to be slow. In Q1 of FY26, agencies obligated $151.5 billion in contract dollars, according to USASpending. All that while the government was shut down for 43 of those days, the longest shutdown on record. In Q1 of FY25, with no shutdown, it was $156.6 billion, roughly 20 percent of the year. The money doesn’t stop; it flows to companies that are already under contract, already on the vehicle, and already known to the program office. Those crafty bears can help you spend this quarter becoming one of those companies.
For a quick refresher you didn’t ask for on hibernation and bears, bears don’t just wander into a cave in the fall and pass out. They spend the autumn eating almost nonstop, a stretch biologists call hyperphagia, to build the reserves that carry them through winter. They pick a den and time their emergence for when food returns. A bear that eats too little doesn’t make it to spring, and a bear that wakes up too early burns the reserves it spent all fall building. (The government doesn’t technically hibernate, but under a CR it makes a pretty convincing impression.)
Most small and new government contractors can’t afford to sleep through a quarter. So I’ve pulled together some lessons from how bears handle the season.
Don’t Be Underfed: Going Dark With the Agencies
The most common Q1 mistake I see is treating the slowdown as a reward for surviving Q4 and waiting for RFPs to reappear once there’s a budget. Under the standard CR restrictions, agencies can’t start new programs without an anomaly, so planned FY27 solicitations sit in a drawer. The program offices behind them aren’t sitting in a drawer. They’re writing requirements and running the market research that determines how they procure those requirements. Not all of their money is asleep, either. The $150 billion in defense funding from last year’s reconciliation law is available through September 30, 2029, and doesn’t depend on annual appropriations. If you go dark in October, you miss both market research opportunities and the reconciliation funds still flowing.
Don’t Be Overfed: Gorging on Every Q1 Notice
On the other end of the spectrum, some contractors overcorrect and chase everything. Every RFI, every industry day, and every sources sought notice within shouting distance of their NAICS codes receives a response, and they usually submit a recycled one. Market research responses help a contracting officer decide whether enough capable small businesses exist to justify a set-aside. A stack of generic responses doesn’t help anyone make that call. Three specific responses from companies that clearly understand the work can be the difference between a small business set-aside and full and open. I know you’re hungry, but overconsumption is underfunctioning!
Just Right
The right approach to Q1 is deliberate feeding, and you should start this week. Pull the FY26 fourth-quarter awards in your NAICS codes at your target agencies from USASpending’s advanced search, and build a simple competitor sheet: who won, on what vehicle, at what value. Then download the prime award data for those same agencies and sort by period-of-performance end date. Anything ending in FY27 or FY28 is most likely a recompete, with an acquisition strategy being written now, so add it to your target list. Next, set a SAM.gov saved search for sources sought and special notices in your codes (and keywords), and check the agency forecasts on GSA’s Acquisition Gateway and wherever else they’re posted. Be deliberate, answer only the notices that tie back to your list, and make every response count: relevant past performance, the NAICS code you’d recommend, the vehicle you’d like to see them use, and a direct case for a set-aside. The language you put in front of the government in November has a funny way of showing up in a performance work statement in June.
Don’t Go Too Deep: Waiting for the RFP to Come to You
Some contractors settle so far into the den that they lose contact with the customer entirely. I’ll always argue the opposite. While Congress debates FY27, agencies are negotiating their FY28 requests with OMB, and the President’s budget is due by law on the first Monday in February. If your capability isn’t on a program manager’s mind as that request hardens, it won’t be in the FY28 budget, and you’ll spend 2028 wondering why nobody’s buying what you sell. If you’re only focused on FY 27 right now, you’re already too late. Keep your lines of communication open with your customers and stay top of mind.
Don’t Be Too Exposed: Outreach Without Shelter
On the other end of the spectrum, some contractors spend Q1 out in the open, booking meetings with any agency that’ll take them and walking in with a generic capability statement. (Sorry, AUSA, I am seeing this will be the situation at AUSA in October 2026!) I can assure you the program office won’t remember those meetings by spring. The ones it remembers are the companies that walked in knowing how that office is graded and what they truly care about. It’s sitting in the agency’s congressional budget justification and in the testimony its leaders gave the oversight committees this year.
Just Right
In the Goldilocks piece, I argued for concentrating on no more than three agency relationships (that’s your den). Q1 is when you actually build that den. By the end of October, pull each target agency’s congressional budget justification (DoW’s are on the Comptroller’s website) and its leaders’ testimony from this year’s hearings, and write one paragraph per agency on what that office is graded on and where your capability fits. In early November, use those paragraphs to request meetings and get them on the calendar before Thanksgiving, before December 11 contingency planning eats everyone’s time. Then check your vehicle access. If those agencies buy through a GWAC, an IDIQ, or a GSA Schedule you don’t hold, find the next on-ramp or the prime that holds it and start the teaming conversation now. If the requirement fits a non-traditional path, learn which authority or consortium that office actually uses. If you sell commercial, rewrite your capability statement to say so, because the FAR overhaul’s proposed Part 12 rewrite is built around a mandate to buy commercial whenever possible. Match the vehicle to the buyer and the requirement, not to whatever you happen to hold today.
Don’t Be Too Early: Spending Reserves Before the Money Moves
Some contractors wake up too early, writing proposals, hiring, or locking in teaming partners for requirements still waiting on appropriations. If December 11 brings another CR or a shutdown, that requirement can slide a quarter or more, and the company has burned the reserves it needed for the work that actually releases. The White House asked for $350 billion of its $1.5 trillion defense request through reconciliation, and the House’s version came in at $60 billion. If your target program was riding on that ask, find out now. Word on the street is there is no backup plan if reconciliation doesn’t pass, so you need to know how you’ll handle funding if it doesn’t come through. Don’t spend all your resources before the government’s full resource picture becomes clear.
Don’t Be Too Late: Waking Up to an RFP Someone Else Shaped
On the other end of the spectrum, the contractor that sleeps through Q1 wakes up in March to an RFP somebody else shaped, a customer it’s never met, and a competitor that’s been in the room since October. In FY25, 37 percent of contract obligations landed in Q4 per USASpending, and a late appropriation squeezes that crunch into even fewer months. Compressed timelines favor the companies the program office already knows. You can write a great proposal from that spot but probably won’t win it. Get into customer offices early, get to know them, and understand their priorities instead of sleeping on this important shaping period.
Just Right
The right time to emerge is when you’re ready, and the outcome isn’t fully committed. Before Thanksgiving, write a one-page plan for each December 11 outcome. Another CR keeps existing work funded, so incumbents keep exercising options, and your recompete positioning gets the hours. A full-year appropriation turns new starts loose in a rush, so keep your RFI responses and teaming partners staged to become proposals fast. A shutdown means stop-work orders and slower payments on anything tied to lapsed appropriations, so know exactly how many weeks of payroll you can cover (last year’s ran 43 days) and talk to your bank before you need to. Then clean the den. The comment windows on the FAR overhaul’s second batch close October 19, including the Part 15 source selection rewrite (FAR Case 2026-003) and Part 16 contract types (FAR Case 2026-006), so file through regulations.gov if you’ve ever had an opinion about how you get evaluated. On cyber, don’t mistake a pause for a pass. DoW suspended CMMC Phase 2’s third-party assessment requirement in July while a reform task force reviews the program, but DFARS 252.204-7012, NIST SP 800-171, and your SPRS score and annual affirmation remain in force, and DOJ is still pursuing False Claims Act cases over cyber noncompliance. Make sure your self-assessment is honest and up to date. Check your SAM expiration date today (you know how I feel about SAM)…
Final Thoughts
A slow season isn’t a lost season. What you do while the government looks dormant determines what you’re positioned to win when it wakes up. Government contracting rewards companies in the room before the requirement goes public. Q1 is your best shot at getting into that room, and the window is shorter than it looks.
Pick one move from each section and put it on your calendar this week. If you want a second set of eyes on any of it, or you’d rather not build the recompete list and agency strategy alone, reach out. I do this work with contractors every day (and I promise not to make you sit through another bear analogy).
Hibernation is for the bears, not for government contractors.