Major Acquisition Overhaul: First 17 Parts of the FAR Enter Formal Rulemaking Process
The federal government is undertaking a massive, phased restructuring of the Federal Acquisition Regulation (FAR) to modernize the procurement process. The first 17 parts of the regulation have officially moved into the formal rulemaking phase, signaling the beginning of one of the most significant regulatory overhauls in recent years.
GovCon Takeaway: Contractors must monitor these FAR updates closely. As these rules are finalized, they will fundamentally alter compliance requirements, bidding procedures, and contract administration across all federal agencies. Ignorance of these updates could lead to compliance failures down the road.
Federal Agencies Awarded $179B to Small Businesses in 2025, Marking a Noticeable Decline
Federal agencies awarded $179 billion in prime contracts to small businesses in Fiscal Year 2025. While still a massive figure, this marks a noticeable dip from the record highs seen in 2024, raising concerns among industry advocates about the shrinking piece of the pie for small and emerging federal contractors.
GovCon Takeaway: With a shrinking federal contracting pool for small businesses, competition will inevitably intensify. Small contractors must sharpen their teaming strategies, aggressively leverage their socioeconomic set-aside statuses, and refine their pipeline development to maintain their win rates.
White House Executive Order Accelerates the Federal Post-Quantum Cryptography Transition
A new executive order from the White House is lighting a fire under federal agencies to accelerate their transition to Post-Quantum Cryptography (PQC). The directive demands that agencies aggressively update their IT infrastructure to defend against future decryption threats posed by quantum computing.
GovCon Takeaway: IT and cybersecurity contractors must quickly pivot their service and product offerings to include quantum-resistant solutions. Agency RFPs will soon feature strict PQC requirements as standard go/no-go evaluation criteria for IT modernization contracts.
GAO Report Highlights Critical Gaps in Federal Supply Chain Risk Management
A newly released Government Accountability Office (GAO) report (GAO-26-107530) finds that several federal agencies are still lagging in implementing comprehensive supply chain risk management (SCRM) protocols for acquiring critical technologies, leaving the government vulnerable to cyber and physical disruptions.
GovCon Takeaway: Expect upcoming solicitations to demand much deeper visibility into your sub-tier suppliers. Contractors should proactively audit their supply chains for vulnerabilities, software bill of materials (SBOM) compliance, and foreign influence to remain competitive in defense and civilian tech bids.
New GAO Findings Point to Inefficiencies in Federal IT and AI Procurements
Another recent GAO report (GAO-26-108938) highlights persistent bottlenecks in how federal agencies procure cloud computing, software, and artificial intelligence services. The watchdog is urging agencies to adopt more standardized evaluation metrics and agile procurement strategies.
GovCon Takeaway: Tech vendors should prepare for shifting procurement models, such as an increase in consumption-based IT contracts and iterative deliveries. Ensuring your pricing models align with the GAO’s push for standardized federal tech buying will give you a strategic advantage.
