How Women-Owned Businesses Can Win Government Contracts
An estimated 9.1 million businesses in the United States are owned by women, but they collect just 5 percent of government contracting dollars designated for small firms each year—which represents a huge potential opportunity for women business owners.
So how can women-owned firms get their hands on more of the nearly $100 billion that Uncle Sam awards to small businesses every year? At the American Express OPEN for Government Contracts: Summit for Success, panelists highlighted some new provisions in the Women Owned Small Business (WOSB) Program and shared tips for how women entrepreneurs can take advantage of them. Here's a snapshot:
1. Be Proactive
As of last May, award caps of $4 million (products and services) and $6 million (manufacturing) on contract set-asides were removed. Set-asides are federal contracts designated for small-business bidding only.But in order to take advantage of those set-asides, women need to be proactive. These programs are so small, "you won’t see many WOSB [women-owned small business] and EDWOSB [economically disadvantaged women-owned small business] set-asides in the procurement forecasts” that agencies publish at the start of the government’s fiscal year, moderator Lourdes Martin-Rosa, president of Government Business Solutions and American Express OPEN Advisor on Government Contracting, said during the event.
So you have to do extra research to find them. You can sign up on FedBizOpps to receive automatic bid notifications, she explained. You should also watch for “sources sought notices.” Contracting officers are required to research the market to see if the small-business community is capable of fulfilling the requirements of a contract, according to Aditi Dussault, senior advisor in the Office of Government Contracting and Business Development at the Small Business Administration. If the officer finds at least two small firms, he or she must set aside part of the contract for small business—so use this “rule of two” to your advantage when you see potential opportunities.
Sometimes contracting officers' research doesn’t uncover WOSBs, so women need to make sure contracting officers know they are out there. “You need to know the other WOSBs in your industry—I call them ‘competi-mates'—so you can get together, talk to the contracting officer,” and point out that there are two or more WOSBs, therefore meaning there should be a set-aside, Dussault said.
2. Focus On What You Do Best
Lisa Firestone, president and CEO of Managed Care Advisors, a health-care consultancy, cautioned against trying to be everything to everybody. Especially when starting out, focus on your specialty and target what and where you want to sell. “Be an inch wide and a mile deep,” she recommended. Once you have more experience with government contracts, you can expand your business.
3. Research All Contracts
Firestone and Necole Parker, principal and CEO of The Elocen Group, a woman-owned and 8(a) small business that specializes in construction, both stressed how important it is to pay attention not only to new contracts, but existing ones as well. Parker said she researches government data to find out what contracts are expiring and who the incumbents are. “It doesn’t matter how the contract was originally awarded," Parker said. "You can meet with the contracting officer that holds that contract and tell them about the WOSB set aside.”
Firestone added that even if the contract originally went to a small business, sometimes that incumbent has grown and no longer qualifies as a small business. In that case, you might try to team up with that incumbent, now the prime contractor, so it can still meet the small-business requirement.
4. Team Up
Teaming is banding together with other businesses, either multiple small businesses joining together or a small business joining as a subcontractor under a large prime contractor. “Using teaming opportunities is extremely important for these programs,” Rosa said. By teaming with three of her competitors, her firm was able to win a $20-million contract set-aside.
Teaming was how Firestone got started in government contracting. She launched Managed Care Advisors in 1997 and was already successful in the private sector. In 2003, one of her customers asked her to join them in working on a government contract, because she had the expertise they needed. The experience opened her eyes to the opportunities in government contracting.
In 2005, she formed a joint venture with another small-business contractor that helped her learn more about government contracting. It was a mutually beneficial arrangement—she had special expertise and they knew the contracting business. Today, more than 90 percent of her business is government-related.
When partnering with others, however, make sure to get everything in writing. A teaming agreement is key, according to Parker. A teaming agreement is a contract among the parties that are working together on the government project. She had many years of experience in construction and government contracting before launching her own company, and one of her first deals as an independent was done on a handshake with someone she knew. That caused problems later because the parties made different assumptions. For example, she had not specified in writing when she was to get paid. She had assumed that she would be paid at least monthly; it turned out that the prime contractor paid her only when it got paid. In another instance, she lost out on business that she actually brought to the prime, because she had not identified those opportunities in her teaming agreement. “That was a huge mistake for me starting out,” she said. “It led to my losing some money.”
5. Follow Through
Another piece of advice from the panel: Follow up and be “pleasantly persistent.” Network by attending the same events and conferences as agency staff, collect business cards, and then follow up immediately to ask for a meeting. Parker tries to follow up within 48 hours.
“Eighty-five percent of people never follow up," she said. "If you do, you’ll have an automatic advantage." Dussault agreed: “Lean in, ladies. The contracting officers and small-business specialists in these agencies are expecting you to ask for these contracts.”
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.