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The Statement of Work (SOW) is a crucial document that outlines the requirements for a potential contractor, ensuring they comprehend the government's or customer's needs. It defines all performance requirements for the contractor and aids in proposal preparation, source selection, and contract administration. The SOW should clearly specify the work to be done in developing the goods or services, serving as a key reference for both parties regarding their responsibilities. Developing an effective SOW requires a thorough understanding of the needed goods or services to meet specific requirements.