Sell Commercially to Access FAR 12

This is really about turning a defense buy into something closer to an off the shelf purchase, instead of a government funded science project. If Forterra can point to real commercial sales and a set product price, the DoD can often buy under the commercial product rules in FAR Part 12, which are built to move faster and rely more on market pricing. If the deal still needs negotiation, FAR Part 15 governs how the government checks that the final price is fair and reasonable.

• The practical difference is what evidence the seller has to show. In a cost plus style program, the contractor may need to open up labor, parts, and overhead. In a commercial item buy, the officer leans much more on market signals, comparable sales, and commercial pricing data, which is why founders see it as a way to skip years of custom development work.
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• This is the core Anduril and Forterra playbook. Build the product with private capital, field it early, then sell a finished system at a fixed price. In the interviews, Sanders ties that model directly to faster first contracts, higher gross margins, and avoiding the dead end of SBIRs and services work that do not scale into programs of record.
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• There is an important nuance. Part 12 is the commercial buying framework. Part 15 is still the government’s negotiation and fair price machinery when needed. So the point is not that commercial sales eliminate scrutiny. It is that they change the basis of scrutiny, from reimbursing your internal build cost to judging whether your offered price looks fair in a real market.
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Going forward, the winners in defense autonomy are likely to be the companies that can make this commercial case credibly, with a standard product, repeatable deployment, and outside customers who anchor price. That is what lets a startup compress procurement time, protect margin, and turn one finished system into many defense programs instead of rebuilding the product for each one.