Did you know that the United States government paid more than $665 billion on federal contracting in the year 2019? If you’re running a small business and you’re looking to grow then there aren’t many more effective routes that you can take than learning how to get a government contract.
Many small business owners fail to realize that working with the United States government is a perfect avenue towards growing your income and scaling your business upward. It is no secret that the government needs to purchase and utilize goods and services in order to continue functioning.
They need everything from weapons and technology for the military to folders and staplers for clerks at the Capital building. If your business focuses on business-to-business sales then odds are that you’re perfect for working as part of the North American Industry Classification System.
The good news is that you’re in the right place to learn more about getting a government contract. Keep reading this article to learn everything that you need to know to get your first government contract today!
Why You Should Learn How to Get a Government Contract
There are a number of legitimate reasons why you should look at getting a government contract as a way to grow your business and your revenues. The United States government is one of the largest consumers in the world and they’re a gold mine if you’re a company that provides goods or services that match the needs of the government.
Here is a closer look at the reasons why you should use your small business classification to get a government contract.
- The U.S. Government Is the World’s Largest Buyer
The United States government spends anywhere from $350 billion to $500 billion each year on government contracts which means that the government is the largest purchaser of goods and services on the globe. It would be a massive mistake as a small business owner to miss out on your chance to capitalize on growing your business by helping the government by meeting their needs.
- Government Contracts Cater to Small Businesses
You’re now aware that the government spends around $500 billion each year on government contracts. Did you know that the government tries to cater especially to small businesses and small business owners? Around 23 percent of the contracts that the government hands out go to small businesses.
23 percent might not seem like a massive amount of contracts, but it is much closer to a guarantee of getting a contract than five percent. You’ll have a much better route towards competing for contracts against much larger companies and organizations.
There is even a way to find out about different government agencies that aren’t meeting the specified 23 percent of contracts to small businesses. Using the Federal Procurement Data System will help you find different agencies that are perfect for you to work with. That will give you a massive advantage over competitors when it comes to securing a government contract for your business.
- More Information at Your Disposal
A big disadvantage that you’ll encounter when you’re submitting bids to private customers is that you don’t know what their expectations are when it comes to the rate and the term. You have no clue what their budget is and how much they’re ready to spend on your services.
When you’re looking at securing federal contracting, you’ll know exactly what they’re looking to spend. That type of information will change the game and give you a big advantage when it comes to learning how to get a government contract for your small business.
Each federal agency is required by law to create a written budget with each passing year. It will be in great detail and talk about everything that they plan to spend their funds on over the next calendar year. As crazy as it might sound, all of that information is available through the public domain.
You’ll have to do some digging in order to find all of it, but it is all there for you to discover. All you’ll need to do is take steps to Get a SAM registration and you’ll be ready to meet whatever needs the agencies of the federal government have. It is essentially getting the playbook of the other team to know how to meet their needs.
How to Register for Government Contracts
There are a number of steps that you’ll need to take when you start the process of learning how to get government contracts for your small business. These contracts are of massive value to any small business, but it is important that you know how the 8a program works and the process for registering for it.
Here is a closer look.
- Get Your Business’s DUNS Number
Odds are that you’ve never heard of a DUNS number, and that is okay. Your business’s DUNS number, or Dun & Bradstreet Number, is a number that you’ll need when you’re registering to submit bids for government contracts. You’ll need to get a different DUNS number for each physical location of your small business.
The good news is that the process for getting a DUNS number is simple and free. You’ll need to go online and apply for a DUNS number through the DUNS Request Service.
- Locate Your Company’s NAICS Code
Your small business most likely has and needs a North American Industry Classification System code. This code helps to classify your business based on the country that it is located in, the industry that you operate in, and the economic sector that your business operates in.
This number and these classifications are vital to the government when it comes to taking bids for government contracts. If you’re planning on registering your business to submit bids for federal contracting then you’ll need to make sure that you have this NAICS code.
If you’re not sure what your code is then you’ll want to reach out to the Small Business Administration for help. They’ll have the knowledge and expertise to help you track down your code based on the sector that you operate in. Keep in mind that you might have multiple codes if your business operates across multiple industries.
- Figure Out Your Business Size
Many people don’t put much thought into the size of their business, and they view things through the lens of small businesses and large businesses. There are different sizes of small businesses as categorized by the Small Business Administration. Make sure that you do your research and find where your business falls on the spectrum.
The good news for you is that the Small Business Administration provides a helpful tool that is perfect for determining the size of your business. You’ll need your aforementioned NAICS code(s) along with some information about your business. Once you have all of that you’ll have an easy time finding out if your business qualifies as a small business for federal contracting.
- Register Your Small Business in the System for Award Management
The System for Award Management is a massive database that is full of small businesses and companies that are interested in working with the United States government through the use of federal contracting. This database is maintained by the federal government.
Think of this database as the government’s form of Google or Facebook when it comes to finding help with solving their issues and meeting their needs. They can search for businesses that do what your business does. They’ll use this database to find companies that help them with problems that they’re facing.
You should put a lot of time and effort into bolstering your search engine optimization for the System for Award Management database. Make sure that you write a thorough capability statement for your business so that government agencies have a clear idea of how you can help them.
- Use Past Performance Evaluations
Make sure that you also display your past performance evaluations and testimonials so that the government agencies know that you perform good work. Providing this information will make these decision-makers much more comfortable with going with your small business to meet their agency’s needs.
Your best bet is to work with a certified DUNS auditor to perform an audit of your business. They’ll use their rating system to determine if you provide quality work that meets the standards of the federal government.
How to Get a Government Contract
Now that you’re registered with the System for Award Management database and you’ve been audited by a DUNS auditor, you’re ready to start making bids on different federal contracting opportunities. There are a few different approaches that you can take to get your first government contract.
Here is a look at those different routes.
- Check Out SAM.gov
SAM.gov is a massive database of different government contracts that you can make a bid for with different government agencies. All of the currently open opportunities are listed at SAM.gov. All of these contracts are worth at least $25,000 or more so it is a great opportunity for your small business.
It is also a great tool for looking at previous bids that were accepted by government agencies. Make sure that you use this information to prepare bids of your own in the future. These past bids will give you a much clearer idea of the market.
- Look for a Subcontracting Chance
SAM.gov is a valuable resource but it involves direct contracts from the federal government. Those types of federal contracts are also known as prime contracts. That isn’t the only form of federal contracting that you need to consider for your small business.
Enter subcontracting for federal contracts. Subcontracting gives your small business the chance to negotiate contracts with the different government agencies that need the help that your business provides. You’ll take care of a portion of the needs of the agency that a prime contractor can’t cover.
Subcontracting is a wonderful way to get started with learning how to get a government contract. You’ll make good money by doing subcontracting and you’ll gain valuable experience when it comes to working with the federal government. You’ll have a difficult time finding a more effective route towards securing prime contracts.
- Market to Agencies
A third option that you have for learning how to get a government contract is to market your small business right to the agency and its decision-makers. If you work in a specific industry and you know that the government needs your services or products then you’re in a position to market right to the agencies.
You can make good use of SAM.gov or you can go through SUB-Net as a way to look for existing opportunities for your small business. These databases will give you a path towards communicating directly with the government agencies to see if you can come to a deal.
This provides a ton of value even if that particular government agency doesn’t have an opening or a need for your services at that point in time. You’ll open the door to future business with that agency and start a personal relationship with them.
- Use a Bid-Matching Service
There are bid-matching services that are quite valuable if you’re having a hard time securing a government contract for your small business. Small businesses that work in a more generalized industry might have a difficult time finding a government agency that needs their goods or services.
Using a bid-matching service will help you connect with the decision-makers at different agencies that have made it known that they need help from a business like yours. It makes your life easier and allows you to secure federal contracting.
Now You Know How to Get a Government Contract for Your Business
Learning how to get a government contract for your small business is a great step towards increasing your revenues and growing your business. Make sure that you’re taking the right steps in order to register your business to get federal contracting through the System for Award Management. If that doesn’t work, don’t be afraid to work as a subcontractor or use a bid-matching service.
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