How to Get Government Contracts for Small Businesses
Most government contracts go to corporations, but there still plenty available. Click here to learn how to get government contracts for small businesses.
The government spends a whopping $500 billion every year on contracts. That’s almost equivalent to Sweden’s economy.
According to the federal law, nearly a quarter of these should be government contracts for small businesses. However, that doesn’t mean you automatically qualify for one as an SMB.
Government contracting is extremely competitive as a considerable number of SMBs bid to get these contracts. Everyone wants these contracts; they are big money. This type of competition poses difficulties for any aspiring SMB.
For that reason, we’re here to help. There are several things you need to know, and this post is going to break down everything for you.
Keep on reading to learn more!
Types of Government Contracts for Small Business
The government aims to provide small businesses with a level playing field in contracting. It limits competition by providing small business with set-asides. Two types of set-aside contracts are:
- Competitive set-asides
- Sole-source set-asides
The competitive set-asides contracts are offered to small businesses when at least two of them are required to perform the work. The contracts are in most cases worth less than $150,000 with a few exceptions.
Under this type of contract, there are two categories of set-asides. Some are open to any firm that qualifies for a small business. Others are specifically for small businesses that participate in SBA contracting assistance programs.
The sole-source contracts are issued devoid of competition. They take away the competitive bidding process and are mostly an exception to the norm. The government issues sole-source contracts if only a single business can meet the contract requirements.
For example, in the construction industry, the government might choose BidsConstruction company for the contract.
For your business to qualify for these types of government contracts for small businesses, ensure that you register it with the System for Award Management. You will also need to participate in any contracting programs available to you. It is a unique program to help businesses win federal contracting dollars annually.
For formal reasons, the sole-source contracts are published publicly, but the intent to sole-source is made known. Potential vendors are free to view and bid on them. However, once a company has been awarded the contract, the sole-source intent is withdrawn.
The government offers contracts for both goods and services. At any one time, the government might be in need of any tangible items from vehicles to printing papers. The secret of succeeding in the bidding process is ensuring that you have what the agency needs.
The government may also float contracts for services. Sometimes it does not have full-time workers. You stand high chances of winning a service contract if that is your line of operation.
Registering for Government Contracts
If you want to increase the chances of winning a government contract, research widely. The federal marketplace contains a lot of information to guide you in the right direction. Additionally, take advantage of the Small Business Administration resources.
There are various databases where you can find open federal contracts. Governments also have databases they use to find contractors. It is an advantage to you if you are registered on these databases.
The popular database is the Dynamic Small Business Search. The government uses it to find potential small business contractors. As a small business, you can use the database to find potential business partners.
SBA maintains the database. The information you provide during registration is crucial during contract bidding. Ensure that you create a business profile that is comprehensive.
A great way to start is to secure a contract with the U.S. General Service Administration. The agency plays a significant role in connecting the government with contractors. Once you get onto the GSA Schedule, it is like a direct ticket to conduct business with the government.
Getting your business into the GSA Schedule requires that you pay for a Past Performance Evaluation report. The report is available from Open Ratings. It evaluates how your company performs within the industry.
It is a requirement for the vendor bid process.
Improving Your Chances of Winning Government Contracts
The government is the largest buyer for all types of products and services. The law requires it to give small businesses a chance to supply it. The government spends billions of dollars on purchases. You can benefit from the contracts if you improve your chances of winning.
Determine What You Will Offer
It is not possible to sell everything in your inventory to the government. Check the government agency that can make a good fit for your goods or services.
Talk to the Procurement Center Representative
This is the contact point between you and the government. They will provide you with all the information necessary. They will also help you with updating your business profile for the government to know what you are offering.
Keep in Mind the Competition
If you are bidding for the competitive set-asides, check for the open contracts worth more than $25,000. Check to see the agencies that are yet to meet the 22.5 percent requirement for small business contracts.
Put Together a Winning Pitch
You can enhance your proposal by borrowing tips from successful bids. This will allow you to present a professional image that gives you an edge over the competition.
Government Contracts for Small Businesses – Final Thoughts
Winning a government contract is a huge undertaking, and that means big money for your business.
Given the government has set aside contracts for SMB, you have an equal playing field with other SMBs. You may not score a contract right away, but submitting your bid gives you experience and helps you determine your niche.
If you conduct your research, it is possible to become a match for the federal government. Your business can become a partaker of the billions of dollars spent on contracts if you follow the contract guidelines.
Register with the SBA and with the SAM and your will be close to winning the contracts. Also, it’s advisable to note the patterns and trends of how government agencies are spending money. Keep track of SMBs that are winning contracts and the value of the contracts.
You can continue reading our blog for more business advice.