Sunday, March 13, 2011

Shortcuts On How To Increase Increase Your Bottom Line With Government Contracts

By Lourdes Martin-Rosa
 

When a slow economy forces most businesses to reduce spending, one enormous customer continues to spend: the federal government. Just in 2009, the U.S. government spent $96.8 billion on products and services supplied by small businesses, including $33.5 billion with small, disadvantaged firms and $16.4 billion with women-owned small businesses.

Given the government's procurement goals of awarding 23% of their spending to small businesses and 5% to women-owned businesses, federal contracting is an important avenue of growth for many small businesses--and now more than ever women-owned small businesses--to consider.

The Small Business Administration's (SBA) long-awaited Women's Procurement Program to expand federal contracting opportunities for women-owned small businesses takes effect Friday, making federal contracting a more viable revenue booster for women business owners.

According to American Express OPEN's government contracting survey of small business owners, two-thirds of women whose firms do business with the federal government generate more than $1 million in sales, despite taking nearly two years, on average, to land their first contract.

There are, however, important steps you must take to pursue federal contracts. Following are key steps, plus useful tips that can improve your chances of landing your first government contract.

Introduce yourself
As with any client, the first step in seeking a federal contract is to make your business known. That means registering your company's information to the Central Contractor Registration (CCR)--the primary vendor database for the federal government. Registration is free. (Currently, there are close to 80,000 women-owned small businesses registered to do business with the government.)

When registering, there are a few important tips to keep in mind. First, make sure that the small-business owner is registered as the primary point of contact. Second, be sure to identify your company's industry categories or NAICS (North American Industry Classification Codes). Third, explore if your business qualifies as a small business on the SBA websites.

If your business is owned by a minority, woman, service-disabled veteran, or located in a particular area, for example, you may have an edge in government contracting.

Also seek any possible benefits offered by the 8(a) Business Development or HUB-Zone programs from the SBA. The 8(a) program was created to help small disadvantaged businesses compete in the American economy and access the federal procurement market. The HUB-Zone program provides federal contracting opportunities for qualified small businesses located in Historically Underutilized Business Zones areas.

If your business qualifies for either of these programs, you may be eligible for sole source, "no bid" contracts up to $4 million in products and services and/or $6 million in manufacturing.

Know your customer

Once you're properly registered in the CCR database, the next step is to learn about the government as a customer. Successful government contractors routinely peruse Fed Biz Opps, an online listing of government contracts that detail all contracts with a value exceeding $25,000. Small business owners can search for contracts that are designated as small-business set-asides and peruse all contracts to better understand what the government is looking for.
When you find a good match for your company, you can bid on contracts directly.

Another valuable resource is USASpending.gov, where you can research contracts by state, industry and several other categories to obtain information on where the money is going. Create a summary search and you can find out who are the largest government contractors within your geographical area, how much the contracts were awarded for and how long the contract will last.

Narrow down your search

The federal government has over 60 federal agencies and thousands of sub-agencies underneath it. From Acquisition Central, you can view upcoming future contracts and learn key insights on creating a strategic marketing plan. The site also provides contracting officer contact information.

An additional resource is the General Services Administration (GSA) Schedule Program. The GSA acts as the "purchasing store" for nearly $66 billion in federal spending, accounting for more than one-fourth of the government's total procurement dollars.


The Amex survey of small business owners found that getting on the GSA Schedule could be an important strategy for winning government business. Under the GSA Multiple Award Schedule Program, GSA establishes long-term, 20-year government-wide acquisition contracts with commercial companies, providing government buyers with direct access to more than 10 million products and services. This program accounts for more than $40 billion in sales every year.


Want to know how much the federal government is purchasing your products and services for? Explore the GSA eLibrary where thousands of GSA Advantage Pricing Catalogs are posted to help federal buyers with their procurement orders. Viewing these prices and services can be a valuable tool to determine your pricing strategy.

Seek out potential partners

An effective way many first-timers gain entry into the world of government contracting is to work as a subcontractor for a company that has been awarded a federal contract. To learn of opportunities with larger firms who have already won contracts, keep an eye out when perusing Fed Biz Opps. Any contract for more than $550,000 in products and services and $1 million in construction should have a small-business subcontracting plan.

Business owners can also search for potential teaming partners based on industry, geography and other specific attributes by registering on TeamingUSA.com. Once your company profile is complete and you are logged in, you will be able to search for potential teaming partners anywhere in the U.S.

Business owners that team or subcontract to procure federal contracts are far more likely to win those dollars. Compared with active small contractors overall, the survey found that small-business owners who employ teaming or subcontracting strategies win 50% more contracts.

Do your homework

Gaining entry into the world of government contracts can be complicated and time consuming, but by following the steps above and continuing to research and pursue opportunities, you'll be well on your way to landing your first federal contract.

Lourdes Martin-Rosa has over two decades of experience in helping small businesses navigate the procurement landscape. In addition to being an American Express OPEN advisor on government contracting, she is also the president of Government Business Solutions.

Source: http://www.forbes.com/2011/02/04/women-procurement-program-small-business-contract-forbes-woman-entrepreneurs-sales.html 

2 comments:

  1. Good analyze every points clearly and meaningfully are given. Thanks

    ReplyDelete
  2. Thank you for stopping by!

    ReplyDelete