Is there any question about why the federal government is good to do business with? Perhaps it seems complicated or you are just not sure where to start. Surprised to know, the federal government is the largest customer of goods and services all over the world. In the year ending 2019, they expended more than $ 600 billion on procurement, and 25% of the total amount went to SMBs. And if state and local buying is included, it means that overall, federal government procurement amounts to more than $1.2 trillion.
These numbers depict why one should begin wondering how they could engage in business with the federal government apart from the state and local authorities. The governmental contracting process presents good prospects concerning the acquisition of profitable contracts.
There are numerous opportunities if one can locate and ascertain where to find them and how to get close to the right people. However, one must make sure he / she is ready for the jump and has the right commercial business background to start with. They range from ensuring that the company has complied with all regulatory formalities of government registrations. Follow SAM (System for Award Management) with DSBS (Dynamic Small Business Search) with SBA. From there you will need a well prepared capability statement, which should demonstrate your best skills, and experiences.
When it comes to purchasing, government entities expect to find stable business partners who are trustworthy. Nevertheless, even if your business is young, you can be a government contractor if you possess experience in the industry. Starting with a company that already has government contracts is a good idea and this makes one to be a subcontractor of the main contractor. For instance, big companies, for example, Lockheed Martin, very often need smaller contractors to fulfill their small business procurement quota.
Another benefit of government contracting is the stability it can bring. It can provide a consistent workflow, even when the economy slows down. During tough times, like during COVID-19, the federal government was a major buyer of personal protective equipment, helping businesses stay afloat. In weak economic periods, government spending often helps keep things moving.
Incorporating government contracting into your long-term business strategy is smart. Building relationships with government agencies can lead to new opportunities as contacts move between agencies. The same goes for partnerships with other businesses as a subcontractor or teaming partner.
Once you start working with one government agency, it becomes easier to work with others. It also boosts your credibility with both government and commercial clients. Just like in commercial business, government contracting is about building strong relationships. The advantage with government work is that you can find public data on which agencies buy what you sell and how much they spend on it. While it requires research, the information is available, and sometimes paid services can speed up the process, giving you an edge over your competitors.
Don’t let the paperwork scare you—it’s just part of the process. You need to be thorough, but it’s something you can learn easily. Starting as a subcontractor is a good way to get used to the process before taking on bigger contracts.
Doing business with the government also acts as a seal of approval. If you can navigate the paperwork and meet the required quality standards, it shows other clients that you are a reliable business. This credibility can help you win contracts with both government agencies and commercial clients.
Remember, the government wants to work with small businesses like yours. By partnering with small businesses, they help create jobs and grow the economy. So, don’t be intimidated by the process. Doing business with the government is a smart move for your business.
