Teaming vs. Subcontracting on GSA: Which Should You Choose?
When a GSA opportunity exceeds your individual capacity or capability, you have two structural options: form a Contractor Teaming Arrangement (CTA) with other Schedule holders, or bid as a prime and subcontract work to other firms. Each structure has different legal requirements, compliance implications, and strategic trade-offs. Choosing the right structure for a specific opportunity depends on the nature of the work, the agency's set-aside requirements, and the limitations on subcontracting rules.
The Structural Difference
In a CTA, each team member maintains their own GSA Schedule contract and performs their scope directly under it. In a prime/sub structure, only the prime has a Schedule contract — the sub's work is channeled through the prime. The key practical difference: in a CTA, all members must have active Schedule contracts covering the work they perform; in prime/sub, only the prime needs a Schedule. For set-aside work, the limitations on subcontracting rules define how much of the work the prime (or team leader in a CTA) must self-perform.
When CTA Is the Better Choice
CTAs make sense when: all team members have Schedule contracts covering their scopes, the requirement benefits from multiple specialist firms delivering distinct components, the team leader's set-aside status qualifies for a set-aside order, and each firm's independent billing under their own contract simplifies accounting and compliance. CTAs are particularly common in IT integration requirements where a systems integrator, a cybersecurity firm, and a cloud services provider each bring distinct Schedule-covered capabilities.
| Factor | Favors CTA | Favors Prime/Sub |
|---|---|---|
| All members have Schedule? | Yes | No (sub lacks Schedule) |
| Set-aside competition? | Leader's status qualifies | Prime meets set-aside criteria |
| Accounting simplicity | Each member bills separately | Single prime invoice |
| IFF reporting | Each member reports own sales | Prime reports total |
Limitations on Subcontracting
For set-aside orders, the self-performance requirements (limitations on subcontracting) determine how much work the set-aside certified firm must perform. For services: the prime must perform at least 50% of the cost of labor with its own employees. For supplies (non-manufacturers): at least 50% of supplies must come from a small business manufacturer or be the prime's own products. These rules apply whether you use a CTA or prime/sub structure — the set-aside qualifying firm must meet the self-performance threshold.