The United States Government Is A Very Powerful Client With Deep Pockets
The Federal government usually spends around 500 billion dollars a year on goods and services. This makes the U.S. government an extremely attractive client. There are few other organizations with this type of spending power and clout.
The government also tends to buy goods and services in bulk. If your business has the infrastructure to handle large orders, then the government can help you grow substantially at an accelerated pace.
Government agencies also buy goods and services in large quantities. Large orders can be a double-edged sword for small businesses. However, if managed correctly, they can help you grow substantially and rapidly.
Small Businesses Are Given Special Consideration When It Comes To Government Contracts
In many markets, small businesses are often outcompeted by larger organizations that often have access to almost unlimited resources. This set aside actually might increase a small business’s chances of winning a lucrative bid.
The federal government is required to set aside at least 23 percent of its total spending specifically for small businesses. Several small businesses have made a fortune just on federal government contract awards.
The Federal Government Offers Great Opportunities For Many Types Of Businesses
The government actually designates a portion of the contracts for women-owned small businesses, small disadvantaged businesses, companies within historically underutilized business zones (HUBZone), and service-disabled, veteran-owned small organizations. This allows for underserved groups to have a real chance to get awarded lucrative government contracts.
What Is The Sam Directory?
SAM stands for System Award Management.
In order to do any business with the federal government, you must register your business in the System for Award Management. The government will not hire any type of business large or small that has not registered in the SAM directory.
What Do I Need To Register For The Sam Directory?
You will need the following :
- A Data Universal Numbering System or DUNS from Dun and Bradstreet
- Your Tax Identification Number or TIN
- A Social Security Number if you are a Sole Proprietor.
What Is A DUNS Number?
The Data Universal Numbering System—or D-U-N-S number—was created and copyrighted in 1962 by Dun & Bradstreet. It is a unique nine-digit identifier that has become the standard numbering system to identify businesses across the globe. You can compare the DUNS number as a social security number for your business.
Any contracting opportunity within the System for Award Management (SAM) will require a DUNS number.
Are There Any Other Advantages For A New Business To Registering For The SAM Directory Besides Government Contracting Opportunities?
A business has to be registered with SAM before they can begin to apply for valuable federal grants.
What Is A Federal Grant?
A grant may be a way the government funds your ideas and projects to provide public services and stimulate the economy. Grants support critical recovery initiatives, innovative research, and lots of other programs within the Catalog of Federal Domestic Assistance (CFDA).
The following are the steps to apply for a grant:
- Step 1: Obtain a DUNS Number
- Step 2: Register with SAM
- Step 3: Register with Grants.gov
What Other Information Does A New Business Need to Register For SAM?
It is important that a business understands the government classification system which includes the following codes:
- NAICS
- PSC
- FSC
What is a NAICS number?
NAICS is a six-digit code that stands for the North American Industry Classification System. Many federal agencies post contracting opportunities using the NAICS codes. The NAICS is used as an internal reference that quickly describes what a business does. You want to make sure you have the correct NAICS number to qualify for as many contracting opportunities as possible.
What is the PSC number?
PSC stands for Product Service Code and is primarily used by the Federal Procurement Data System (FPDS) and the General Services Administration (GSA). They are used to describe the types of products, services, and research and development purchased by the federal government.
What is an FSC Code?
Federal Supply Class (FSC) codes are four-digit codes that are used to group products into logical families for supply management purposes. These codes are also used to classify government standards documents into categories, to help manage them more easily. FSC codes are grouped by Federal Supply Group (FSG) numbers.
CAGE Code (Commercial and Government Entity)
This code is five characters and unique to your business. It’s basically your ID code, and government agencies will identify your business using this code. It is a bit like a social security number for your business. If your business includes more than one facility, then you will need multiple CAGE codes. Each location must have its own unique code, and each location must be registered separately with SAM.
High-Level Security and Background Checks
It is important for government contractors to be able to pass several security clearances. A background check on your company and employees is often a condition of employment.
This will include the following:
- Employment
- Education
- Criminal Records
- Credit History
- Motor Vehicles and License Records
You should make sure that all your personnel and employees are able to pass this intensive screening. If there are any issues, make sure the government is made aware of it ahead of time, so that an explanation can be given. For example, if you are participating in programs that rehabilitate criminals by giving them jobs. Transparency is often the best way to deal with situations that might cause an issue in obtaining lucrative government contracts.
SAM Directory Can Help
Remember, registering for the SAM directory gives a business automatic entry into the extremely lucrative marketplace of the federal government. It is also a crucial step for applying for rewarding government grants that can help your business reach its full potential. Let us, the professionals at SAM Directory, make sure that you do all that is needed to not miss out on this important opportunity. We will make certain that your application is processed quickly and efficiently so you can start being a federal contractor as soon as possible. We remove this hassle so you can go about the important mission of running your company. Stay tuned for this next article in this series.