As the largest procurer of goods and services in the world, the U.S. government is a tempting target customer for many entrepreneurs. And the good news is, Uncle Sam likes buying from small businesses. In fiscal year 2013, for the first time in eight years, the government met a congressionally-mandated goal of awarding 23 percent of contracting dollars to small businesses. That’s nearly $100 billion.
But navigating the maze inside the Beltway can bring plenty of challenges, especially for smaller companies that don't have some of the resources and connections to land government contracts. The American Express OPEN for Government Contracts: Summit for Success, held in Washington, D.C., sought to provide a helping hand, with tips on how to learn the system and leverage their connections.
During the daylong event, speakers and panelists—including contracting officers from various government agencies, representatives from large prime contractors and small-business owners who have won government contracts in the past—zeroed in on several common tips and tactics for getting your share of government contracting dollars. Here's a snapshot:
1. Learn the System
The rules and processes of government contracting can be arcane and challenging. Knowing how the request for proposal (RFP) and bid systems work, understanding how to navigate government websites to find information, and being able to submit a great proposal can put you head-and-shoulders above your competition. For example, every agency publishes a procurement forecast on the Federal Procurement Data System at the beginning of each fiscal year, which starts on October 1. Reading that forecast can alert you to possible contracts to bid on.
What’s more, the best small-business contractors know the programs and rules so well they can educate agencies on how to set aside contracts for small business. Even though government purchasers are under pressure to buy from small businesses, they have many other responsibilities. “Small businesses aren’t the first things on their mind,” said John Shoraka, the Small Business Administration's associate administrator of government contracting and business development, who spoke at the event. "When spending money, they don’t always think first about reviewing to see if small businesses could provide those goods and services.”
Oftentimes, contracting officers don't know about the various ways they can set aside contracts for small business. Or they don't know of small businesses that can do the type of work they need. It's really up to the small businesses to get into these agencies and let the contract officers know they exist and what kind of work they do.
2. Follow the Process—Exactly
The system for bidding on government contracts is very prescribed, meaning there are strict rules as to how things should be done. In a session on navigating the federal procurement process, Denise Rodriguez-Lopez, president and CEO of management consulting firm The KMJ Company and OPEN Advisor on Teaming, emphasized reading the RFP carefully and following instructions to the letter—sometimes literally. “The other day, we saw a proposal that said very clearly it had to be in Times New Roman, 12-point type,” she said. “If you submitted it in Times New Roman, 10, you’re eliminated automatically.”
Also note the time zone of the office to which you are submitting the proposal, or you may inadvertently miss the deadline, advised Ron Perry, president and CEO of Teya Technologies. Teya is an 8(a) certified Small Disadvantaged Business that provides a wide variety of services, including event planning, communication and technology installations, custodial services, project management, and construction jobs to government and commercial clients. The company is based in Alaska, which is four hours earlier than Eastern Standard Time. “When it says the proposal has to be in by close of business, 5 o’clock, on [a particular] day, always ask, ‘Close of business where?’"
3. Develop and Rely Upon Relationships
All business, especially small business, is based on relationships, stressed James McCann, founder of 1-800-Flowers, in his keynote speech. People have a basic need to connect, and building connections leads to business ideas, referrals and success. For small businesses seeking government contracts, the combination of knowledge of the system and the right relationships can unlock doors to a wealth of contracting opportunities.
Shoraka also suggested getting to know agency contracting and program officers. “When you have that knowledge [of government contracting programs for small business] and you present yourself to these agency staff, that’s where the connections really happen,” he said.
Also make sure to build relationships with your competitors, who are potential teaming partners in going after larger government contracts, Perry advised. One small business may have an IDIQ (indefinite delivery, indefinite quantity) contract for a particular agency, but needs additional expertise and skill sets in order to sell the maximum amount through that vehicle. Teya, for example, has a $10 billion, 10-year IDIQ, but has sought out partners in other geographies and technical areas. “Let your partners know you have such contracts. These are little flags that go up,” so other businesses know you have a selling vehicle in place, Perry said. “The way to use these contract vehicles [to maximum benefit] is to share them with others.”
4. Find Your Niche—And Market It to the Right Agencies
Another key step is identifying who buys what you’re selling, getting to know the people in those agencies and then not being shy about marketing to them, according to Necole Parker, principal and CEO of The Elocen Group, a woman-owned and 8(a) small business that specializes in construction. All government solicitations over $150,000 are posted on the FedBizOpps website. But often, the only way to find out about lesser contracts is through relationships with key people at a particular agency.
Target two or three agencies based on who buys what you are selling and stay on their radar. If you do construction, for example, you might concentrate on the Department of Transportation, and home in on the particular agency that focuses on bridges, if that's your specialty.
If you maintain a good relationship, you’ll be able to inform agencies about your products and services. “I have no problem trying to educate contracting officers,” Parker said. “I'll ask them if they know about the WOSB Program, [and if not] explain how they can use it. I also explain how to use the 8(a) program. I play both cards.” The door also swings the other way: Once they know you, agency staff are more likely to tell you when other contracts are in the offing, even before they are listed on FedBizOpps.
Throughout the day, speakers urged small businesses to learn as much as possible about government contracting and the agencies they're targeting. One particularly helpful resource for those new to government contracting is the SBA's General Contracting Classroom, Shoraka said. Even if they have no experience with government contracts yet, small businesses willing to learn may find a nice payoff for their efforts. Lourdes Martin Rosa, president of Government Business Solutions and American Express OPEN Advisor on Government Contracting, reminded participants that the government is the largest buyer in the world. "So the only thing that they produce is money. They need our help on everything else."
OPEN Forum: Government Contracting is a program designed to connect small business owners to government contracting opportunities, which are an often-overlooked revenue stream. To learn more about how to take advantage of this $500 billion opportunity, visit openforum.com/governmentcontracting.