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Get The Bid Package After you have ascertained the government contract that you want to bid on, it is important to contact the agency and request a bid package. This package is also often called the solicitation package. After you receive the package, review it carefully. Find out what the purchasing office wants to buy and figure out if your company can meet the requirements. The Bid Package should contain the following: the buyer’s contact information, including name, address, phone number, and e-mail address, is listed on the bid notice. When you request the bid package, make sure to also ask for amendments. 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. However, before companies bid for contracts, it is important to understand the different types of contracts utilized by the government. Time and Materials Contracts The government rarely awards this type of contract because of the expense. A Time and Material Contract requires paying directly for any and all costs that are associated with the particular project. Labor Hour Contracts are defined as a variation of the time-and-materials contract, differing only in that materials are not supplied by the contractor. See 12.207 (b), 16.601 (c), and 16.601 (d) for application and limitations, for time-and-materials contracts that also apply to labor-hour contracts. See 12.207 (b) for the use of labor-hour contracts for certain commercial services. Labor Hour Contracts do not include the cost of materials. Indefinite Delivery Contracts The government uses this type of contract when it does not know in advance exactly how much of a product or a service will be needed for a project. They will usually list a range, and certain companies will be invited to provide their lowest bids on a per-item basis.  This includes Task-Order Contracts, which permit government stocks of specific items to be maintained at minimum levels and allow direct shipments to the users of products or services. They also permit great flexibility in both quantities and delivery schedulin,g and the ability of buyers to order supplies and services only after specific requirements for them materialize. Job-Order contracts, a competitively bid, fixed price, multi-year construction contract based on established or published unit prices via a unit price book (UPB) or a price list with a multiplier (termed coefficient) applied to the unit prices, also fall under this category Fixed-Price Contracts These government contracts are used when the scope of work is clear from the beginning, and therefore, a price is determined by the agency in advance. There are many different types of this particular contract. Firm Fixed-Price (FFP) This contract means that the price is set in stone, and the vendor or small business awarded the contract will be taking all the risk. So if the contract is over budget, the small business owner has to pay out of pocket. However, if the project is under budget, then the business will keep the extra profit. This is a great contract for companies that are precise with their pricing and have a lot of experience in the field. Cost-Reimbursement Contracts Cost-reimbursement is a category of contracts that is used when it would be too difficult to estimate the cost of the project in advance. They usually define a spending limit but are a much lower risk for the service provider than fixed-price contracts.  Cost Contracts This contract pays only for expenses, and there is no profit for the small business provider. Cost contracts are often used for research projects provided by non-profit organizations. Cost-Plus-Fixed-Fee This contract includes a limit for expenses that will be reimbursed, along with a fixed payment for the service provider. Cost-Plus-Incentive Like Fixed-Price-Incentive contracts, this provides a financial incentive for the service provider to come in under budget, while also covering project expenses. Cost-Plus-Award-Fee This contract states that the government client can pay the expenses of completing the project and also provides financial awards based on the criteria outlined beforehand. Cost Sharing This type of contract only pays a predetermined portion of the overall costs. It is most common in research contracts where the service provider will benefit in other ways from the results of the research. The Federal Government Has Government Personnel That Are Strictly Utilized to Help Small Businesses Be More Competitive In Securing Government Contracts Here are some examples: SBA Procurement Center Representative (PCR): Procurement Center Representatives are often located at a major government buying office, even though they technically work for the Small Business Administration. They will identify items and services that could be produced or provided by small businesses and try to get them “set aside” for small businesses, which means that only small businesses can bid for the contracts.  Competition Advocate: This person is responsible for promoting full and open competition at high management levels in the major buying offices. They are supposed to challenge overly restrictive statements of work and contract clauses that can prove to be burdensome. They also try to expand competition for items by offering challenges to requirements that are not deemed necessary for the performance or essential physical characteristics.  Small Business Specialists (SBS): The law requires that every government buying location must have a Small Business Specialist. These specialists work specifically with small businesses to help them do business with that office. Larger government offices might have full staff while smaller offices might only have one part-time employee assigned to this role. Major government buying offices have full-time staff, while smaller offices have a part-time person assigned to that task.  SBA Commercial Marketing Representative (CMR): Commercial Marketing Representatives keep track of large companies doing work for their… Continue reading The Small Business Guide To The Various Types of Federal Contracts

Small businesses often view federal audits with fear and trepidation. The thought of having their financial records scrutinized by government officials can be daunting. However, it is important for small business owners to understand that federal audits are not always something to be feared. In fact, they can provide several benefits and opportunities for growth. Firstly, federal audits help ensure compliance with tax laws and regulations. By thoroughly reviewing a small business’s financial records, the audit process helps identify any potential errors or discrepancies that may have occurred unintentionally. This allows small businesses to rectify any mistakes and avoid future penalties or legal issues. Secondly, federal audits can actually improve a small business’s reputation and credibility. When customers or potential investors see that a business has successfully undergone a federal audit without any major issues, it instills confidence in the company’s financial stability and transparency. Furthermore, federal audits can also serve as an opportunity for small businesses to identify areas of improvement in their financial management processes. By closely examining their records during an audit, business owners may uncover inefficiencies or areas where they can optimize their operations for better profitability. Lastly, going through a federal audit demonstrates a commitment to ethical practices and compliance within the industry. It shows that the business is operating with integrity and adhering to all applicable laws and regulations. In conclusion, rather than fearing federal audits, small businesses should embrace them as an opportunity for growth and improvement. By ensuring compliance, enhancing credibility, identifying areas of improvement, and demonstrating ethical practices – these audits can ultimately contribute to the long-term success of a small business. Surprise Audits Government audits can occur without any type of advance notice. Therefore, contractors must always be prepared to receive a solid evaluation.  A surprise audit that reports non-compliance with federal accounting regulations can have negative consequences, including contract termination, and payments can be withheld unless improvements are in place. In addition, this can be very time-consuming and stressful. Keeping Ahead of Technological Innovations Keeping pace with stringent government accounting policies allows a company to truly understand governmental purposes, needs, and more extensive processes and then use that knowledge to manage and methodically grow the company.  Luckily today, many cutting-edge technologies can take the pressure off by making even the most complex accounting procedures quite simple. These innovations help a contractor comply with government requirements, permitting employment of systems for management and growth while adapting to keep in step with ever-incoming changes in conditions. Also, having a solid accounting system will only improve your company in the long run. Rules Of Timekeeping And Accounting Government contractors have to maintain rigorous schedules when compared to the private sector. Therefore, your business must comply with a set standard of rules and regulations when reporting on how many hours worked in a certain period. The Financial Accounting Standards Board (FASB) states that contractors must comply with the following to work with the government: Federal Acquisition Regulations (FAR) Cost Accounting Standards FAR agency supplements Simplified Procedures In 1994 the Federal Acquisition Act FASA simplified the buying procedures of the government. Many of the more harsh restrictions on government purchases were removed for any purchase less than $100,000. Now agencies use much simpler procedures for analyzing and soliciting bids up to $100,000. However, the government must still advertise all purchases over $25,000 at www.fbo.gov. Make Use Of Government-Provided Free Tools. You can identify contracting opportunities online by utilizing tools such as this forecasting tool that lets you see what opportunities are available. You can study the government contracts that are a couple of years old to see what requirements are needed to win the job. This puts you in an excellent position to have all your research completed when the contract is about to expire and you put in your proposal. Do Not Give Up! At some point, the process can be a little overwhelming. You must keep in mind that the reward will be worth all the effort. According to the American Express OPEN survey, 57% of businesses said their revenue has grown significantly because of government contracting, and at an average rate of 61%. However, business owners should keep in mind there is no secret formula for securing a contract. The United States government is a very lucrative client for any small business. The Government Wants Small Businesses To Succeed 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. Make Sure You Have Your CAGE Code (Commercial and Government Entity) This code is five characters and unique to your business. It’s 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. 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 the next article in this series.

The United States Government Is A Very Powerful Client With Deep Pockets The Federal government usually spends billions of 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. Why Work For The Government? There are many compelling reasons to work for the Federal Government.  We will go into in-depth detail about how a small business can benefit significantly from being a government contractor. Being A Government Contractor Is A Great Way To Make Your Business Stand Out In An Overcrowded Field Business can be very competitive. Working on government projects is a great way to make a mark in an oversaturated market. The government has a great deal of work specifically set aside for small businesses. Also, many small businesses often do not want to deal with the hassle of working with the government, and sometimes there can be surprisingly little competition for a government project. That is why utilizing Sam Directory to handle all the confusing registration requirements is a very smart investment.  Never Underestimate The Power Of Relationships As part of understanding your customer, it is very important to build strong relationships within the government agencies. The government is not a giant cold faceless entity. It is made up of people and they will appreciate the opportunity to speak to you face to face. An impressive interview might win you a supporter that will lobby in your favor. A Fantastic Presentation Is A Key To Success Having a good presentation is vital to winning over the federal government. You want to be able to make an excellent impression that goes beyond just having a great price point. It is important to understand that this is not your typical business client. Because the presentation to the United States is so different from presenting to other businesses, many companies get flustered.  Let us guide you through this often intimidating process. Be Prepared To Give An Oral Presentation Oral presentations are very common for companies who want to work for the United States government. This is going to be a different audience. You might not get the greeting and niceties that usually come with this type of business meeting. The government employees are not allowed to react to anything that is said. You should be used to seeing no feedback until the question and answer period. You Still Need To Make Yourself Stand Out The federal government will watch many groups of people from various other companies. They have a point system and award the contract to the business that scores the most points. The government will often see the basic material being presented numerous times. Your presentation must be unique and memorable in a positive way. Your company needs to catch their attention. Small Business Administration Certifications A Small Business Administration certification is a great way for your business to stand out in the marketplace. Certifications can help you gain access to specialized funding and scholarships, allow you to compete for set-aside contracts, and can be a great bonus to potential clients. Here are some certifications to consider for your small business: Women-Owned Small Business Federal Contract Program (WOSBs) 8(a) Business Development Program The Service-Disabled Veteran-Owned Small Business Concern Procurement Program(SDVOSB) Historically Underutilized Business Zone Program (HUBZone) Special Programs Help is available from special small business programs that encourage participation by small businesses and help these businesses navigate the government contracting maze This includes small businesses owned by minority and traditionally disadvantaged groups. These programs, which are administered by the Small Business Administration (SBA), assist small businesses on how to obtain both large business and government procurements. Publications The government has issued some publications to also assist small businesses. They are as follows:  Selling to the Military: Has all the information needed about items the military is currently looking to purchase. This includes contact information for the buying offices and the Small Business Office. Small Business Specialists for DoD: This is a listing of names, addresses, and phone numbers for all the resources you need to do business with the Department of Defense which is one of the most well-funded purchasers in the government. Participating in the VA Acquisition Program: This publication covers general information about how and what the Veterans Administration buys. Understand The Chain Of Command In the private sector, you might have a boss or manager whom you report to daily. The chain of command is usually very straightforward. In the world of government contracting, you might have several people to report to, including managers from other contracting companies. There can be a steep learning curve when it comes to managing the expectations of several government employees at once.  However, there are endless opportunities and one can gain priceless experience by working with several agencies. Many departments in the federal government contain hundreds of agencies. These places have a wide variety of needs that can easily be filled by small businesses. Working with one agency often opens the door to other departments, making the scope of opportunities endless. How Do You Get Started Working With The Government? SAM stands for System Award Management. 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 that has not registered in the SAM directory. We have an article on our site, Everything You Need to Know About SAM for Small Businesses, that gives you important information about this process.  Is very important building As a smart… Continue reading How To Make Your Small Business Stand Out When Marketing To The Federal Government

Understanding The Federal Contracting System General Services Administration, also known as GSA, is responsible for acquiring the goods and services needed by federal agencies. The United States government basically needs everything and is a super consumer worth $500 billion. The government uses schedules to purchase goods and services. When there is a need in an agency, it is called a schedule award. These are great opportunities for small businesses. A company needs to bid for the award. Once the award is won, the winning bid signifies a signed contract between the business and the government. This means that learning how to bid for these government contracts is extremely important in order to be successful with this lucrative customer. The First Step Is Registering With SAM To do any business with the federal government, you must register your business in the System for Award Management directory. The government will not hire any type of business (large or small) that has not registered in the SAM directory. Please read one of the helpful blog articles on our site, like Everything You Need to Know About SAM for Small Businesses.  These blogs will help give you all the information you need to understand how we can help make the process very easy for you. Sam Directory will happily guide you through this often confusing process. 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 to a Social Security number for your business. Any contracting opportunity in the System for Award Management (SAM) will require a DUNS number to apply. 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. How Do I Get On A Schedule Collect all the documents you need and submit them to the GSA. A procurement officer will review your paperwork and either approve or decline your submission. This process requires some attention to detail. Where Do You Find Government Contracts For Bidding Search for opportunities at the following SAM.gov. Federal agencies are required to publish all contracts that are above $25,000 on SAM.gov. This means that there are a large number of contracts advertised there at any given time. Contact a procurement officer for information on contracts that are below the $25,000 threshold for publishing. Look To Your Local PTAC Office Procurement Technical Assistance Centers or PTACs provide free assistance in government contracting. They will help you identify bidding opportunities and if your company meets certain criteria to work with the government. Here is also where you can find out if your business can be certified as 8(a), WOSB, or HUBZone. The Bid The Federal government has the following types fo solicitations for bidding: Request for Quotation (RFQ). This type is for contracts below $150,000 with a simplified acquisition procedure. Request for Proposal (RFP). This type of solicitation asks vendors to make a proposal in response to the government’s request. You can (and often will) discuss delivery details, technical requirements, and specifications with the contracting officer when you bid on that type of solicitation. Invitation for Bid (IFB). The “lowest bid wins” or “sealed bid” type of solicitation. No discussion or price negotiation is implied here. Request for Information (RFI). This is mostly to research the market and evaluate the interest and capabilities of contractors in a specific niche. Make sure you read the solicitation requirements carefully. A solicitation package will include, documents, technical conditions, attachments, and various other things required with the submission. For most federal government contracts under RFP and IFB solicitations, there are standard contracting forms you should fill. As for required documents, they are listed in the solicitation Contact your contracting officer if you have questions. It is important that you understand every single thing about the solicitation that you are bidding on. Also, look to FARs (Federal Acquisitions Regulations) that govern the solicitation you are to respond to make sure you know the regulations and requirements. Be Competitive Use resources like USASpending.gov or govspend.com to compare your bids using third-party service providers. The government uses to  Most Favored Customer or MFC to determine what is fair and reasonable pricing. This is defined as” A Standard Clause allowing a buyer to obtain the best possible price on goods or services from a seller by requiring it to provide the buyer with the lowest price among all buyers in that market. If the seller wants to offer a different buyer a lower price, it must also first offer that price to the buyer with the most favored customer clause (MFC), also known as a most favored nation clause. MFCs can implicate US antitrust laws, which analyze the enforceability of MFCs using a rule of reason analysis. This Standard Clause addresses the price of goods and has integrated drafting notes with important explanations and drafting tips. Submission It usually takes the government 30 to 120 days to review your submission. The Contracting Officer evaluates many factors including financial figures of your business, how long it has been on the market, past performance reports, and, of course, if your pricing is competitive. Whether your proposal is accepted or rejected, you will receive a response from the Gov’t. Sometimes, the Contracting Officer requests some more information or asks you to clarify some issues.… Continue reading Small Business Strategies To Win Government Bids

One of the first steps to a successful business is making the right decision about which state you should file. Why Delaware? Delaware is an extremely popular state to set up a new business. They have a variety of laws and policies that are very attractive to young companies. Delaware has great tax benefits. There are no taxes for companies that operate outside the borders of Delaware. So you are not paying any type of Delaware State Taxes if you have no physical office within the state. The following tax benefits also apply to Delaware: You do not have to collect sales tax from customers.  This makes it easy to start an online business and stay competitive in the e-commerce market.  You may have to pay a gross receipts tax if you do business in the state, but the tax is fairly low and only applies in certain situations. Delaware has no corporate tax on interest or other investment income in a Delaware holding company.  This includes fixed-income or equity investment gains which are also not taxed on the state level. The state has no personal/business property tax.  The county-level estate taxes are fairly low.  This is extremely beneficial if you happen to own tangible property such as an office building. No value-added taxes, use tax, or even inventory tax. Delaware has no inheritance tax. No capital shares or stock transfer taxes.  This is great for businesses who are expecting to obtain venture funding. The state has no tax on intangible assets such as trademarks, patents, and naming rights.  This is great for intangible asset holding companies. The Delaware Court of Chancery The laws of Delaware are extremely business-friendly. The Court of Chancery is a non-trial court dedicated solely to businesses. It handles issues that involve real property and commercial litigation. This court operates with only judges that specialize in complex corporate law. The Chancery Court does not have juries. This allows for a fast and efficient system of justice. The Delaware laws are favorable to business when compared to other states. Courts often use Delaware business precedents to settle disputes. The state’s robust legal systems allow businesses to feel confident about filing in that state. Asset protection Delaware LLCs protect an LLC owner’s assets. An LLC structure is attractive to startups because it protects their assets from lawsuits.  In addition, Delaware is one of the few states that only allows a charging order as the sole remedy for collecting a debt. A court issues a charging order to direct an LLC manager to pay the creditor for the debtor-owner’s personal creditor any distributions of income or profits that would otherwise be distributed to the debtor-member. Creditors with a charging order usually can only obtain the owner/debtor’s financial rights and cannot participate in the management of the LLC. This means the creditor cannot order the LLC to make a distribution subject to its charging order. Usually, creditors who obtain charging orders end up with nothing because they can’t order the LLC to make any distributions. A lot of other states treat single-member LLC as a disregarded entity and allow judgment collectors to pierce the corporate veil and go after the single member’s personal assets.    Starting a Delaware liability company is a great way to protect your assets from lawsuits. Protecting your privacy Delaware does not require it’s LLCs to list members’ names and addresses in their filings. The names of the members are only found in the operating agreement, which is private. This allows ownership and management information to be available through public records. Delaware corporations can also be filed without listing shareholders, directors, or officers in the public record as long as you use third-party incorporation services. The state does have a Franchise tax payment requirement every year where the corporation must list the names and addresses of the company’s director and one officer. Shareholders do not have to be listed and still have privacy protection. Delaware has great investor appeal Investors love a company that incorporates in Delaware. Everyone ranging from venture capitalists and angel investors to private equity firms loves Delaware’s business-friendly laws. Overall, investors understand the Delawares system and banks often prefer Delaware corporations. If going public is a goal then it is wise to incorporate in Delaware from the very beginning rather than having to convert the company to a domestic Delaware entity at a later time. This saves both time and costs in the long run. Overall filing a business in Delaware makes you much more attractive to investors and gives you more options for funding. What are the advantages of filing your business in your home state instead of Delaware? Taxes are paid where your business is making money. If your business operates mostly in another state then you are still liable to pay taxes to that state. A business does not often receive the supposed tax benefit of Delaware unless they are a multi-million dollar operation. This is true even if you conduct most of your business online. For example, you live in the state of California, it’s a particularly bad idea to form a Delaware LLC, because you’ll be seen as doing business in California no matter where your company is formed. You will have to file as a foreign entity in your residential state. If Delaware is not your home state that means you will automatically have to keep up with two businesses. A domestic business in Delaware on top of registering as a foreign business in your residential state. This means extra filing costs and administrative fees and headaches. So filing in Delaware leads to the following additional costs: Paying for an extra Registered Agent, Paying annual reports in 2 states, Having tax liabilities in 2 states, Dealing with the headaches of maintaining 2 LLCs Privacy laws First, there are three other states that allow LLCs to keep their ownership information private. These states are New Mexico, Nevada, and Wyoming. If you in one of these three states, then the… Continue reading Should a new business file in Delaware or their home state?

The most important decision when starting a business is deciding what type of business entity best suits your needs. The business entity you choose can have serious consequences regarding liability and taxation. This article will help you better understand your options by comparing two of the most popular choices. What is a business entity? C-corporation (c-corp) are separate entities from their owners. A c-corp consists of shareholders (the owners), a board of directors, and officers who have control over the corporation. One person can fulfill all these functions. One or more natural persons create a business entity to carry on a trade or business. Business owners often favor corporations and LLCs because they offer several layers of protection for their owners. The following are types of business entities: Limited liability company: A registered business with limited liability for all members Professional limited liability company: An LLC structure for professionals, such as doctors and accountants C-corporation: An incorporated business composed of shareholders, directors, and officers S-corporation: An incorporated business that is taxed as a pass-through entity Professional corporation: A corporate structure for professionals, such as doctors and accountants B-corporation: A for-profit corporation that is certified for meeting social and environmental standards What is personal liability? Personal liability means that your personal assets will be exposed if one of your co-owners or employees commits an unlawful action that injures someone, such as writing a defamatory article or post. If there is a judgment against your company, it can be satisfied by reaching into your bank account, home, or automobile simply because of your status as an owner of the company. Nonprofit: Corporations: A formed primarily to benefit the public interest rather than earn a profit. You also need to be aware of different taxation among different business entities. Business entities have a great effect on government taxation. Before we get to corporations and limited liability companies, let’s talk about some other business entity options which include: Sole proprietorship: A business that is unincorporated with one owner or jointly owned by a married couple General partnership: A business that is unincorporated with two or more owners Limited partnership: A business that is registered and composed of active, general partners and passive, limited partners This is great for the type of person who truly enjoys independence and wants to make their own rules without answering to others. You are your company and are okay with there being no formal division. The business and the owner are legally the same. From the IRS’s perspective, the business is not a taxable entity. The company assets and liabilities belong directly to the company owner. Sole Proprietorship If your company is going to be fairly small a sole proprietorship might be the right business entity for your needs. You, as the owner, will be in control of all day to day decisions and profits. The greatest disadvantage of a sole proprietorship is that there is unlimited liability. The owner will be personally responsible for business debts and losses. Partnerships A partnership is similar to a sole proprietorship except that there is more than one individual that owns the business. The liability of the partners for the debts of the company is unlimited and this means that each partner is ‘jointly and severally’ liable for the partnership’s debts; that is, each partner is liable for their share of the partnership debts as well as being liable for all the debts of the business. If you are someone who enjoys working with a team and does not want to shoulder all the responsibility for the company yourself, a partnership might work for you. If you have the right blend of personalities you can complement each other quite well and be stronger than any of the partners could ever be on their own. As with sole proprietorships, the business and the owners (two or more) are legally the same. A partnership is not a taxable entity under federal law. Limited Partnership A limited partnership contains two distinct types of partners: General Partners Limited Partners The general partners run the day to day activities of the business. The general partners are also personally liable for a business’s debts and liabilities. The limited partners do not have much to do with the way a company is run. They have limited liability concerning a business’s debts and they usually pay fewer taxes regarding the profit. These are silent investors who bring in money but do not run the business. If you want to retain primary authority in your organization but definitely could use some other sources of cash than a limited partnership would be a great compromise. C-Corporation The great advantage of a c-corp is that the owner/owners are not personally liable for the debts and liabilities of the company. The disadvantage is that there is double taxation on profits. The government will tax the corporation as a separate entity. You should think of the corporation as a fake person in the eyes of the Internal Revenue Service. This is a great model for those who really want to start a company that is quite large in scope and size. However, you will be answerable to your shareholders for good and bad outcomes of your business decisions. S-Corporation It should also be noted that corporations have a lot of regulations regarding paperwork and documentation. This is not an entity for you if you want to be footloose and fancy-free. If your corporation has fewer than 100 shareholders who are all individuals, not corporations; have only one class of stock, and be owned by U.S. citizens or resident aliens you could turn your business into an S-Corporation (s-corp). An s corp is not subject to double taxation as a c corp is. An s corp’s revenue is not taxed at the corporate level. It is only taxed when paying out as salaries or dividends to shareholders. An s-corp is often a better choice than a c-corp for most small businesses. Limited Liability Company (LLC)… Continue reading Which is the best business for you, corporation or LLC?

Understanding The Federal Contracting System General Services Administration, also known as GSA, is responsible for acquiring the goods and services needed by federal agencies. As a result, the United States government needs everything and is a super consumer worth 500 billion dollars. The government uses schedules to purchase goods and services. When there is a need in an agency, it is called a schedule award. A company needs to bid for the award. Once the award is won, it signifies a signed contract between the business and the government. This means that learning how to bid for these government contracts is extremely important to succeed with this lucrative customer. The First Step Is Registering With SAM To do business with the federal government, you must register your business in the System for Award Management directory. The government will not hire any type of business (large or small) that has not been written in the SAM directory. Please read one of the helpful blog articles on our site, Everything You Need to Know About SAM for Small Businesses.  These blogs will help give you all the information you need to understand how we can help make the process easy for you. In addition, Sam Directory will happily guide you through this often confusing process. Get The Bid Package After you have ascertained the government contract you want to bid on, you must contact the agency and request a bid package. This package is also often called the solicitation package. After you receive the package, review it carefully. Find out what the purchasing office wants to buy and determine if your company can meet the requirements. The Bid Package should contain the following: the buyer’s contact information, including name, address, phone number, and e-mail address, are listed on the bid notice. When you request the bid package, make sure to also ask for amendments. Where Do You Find Government Contracts For Bidding Search for opportunities at the following SAM.gov. Federal agencies are required to publish all contracts above $25,000 on SAM.gov. This means that there are many contracts advertised there at any given time. Contact a procurement officer for information on contracts below the $25,000 threshold for publishing. Look To Your Local PTAC Office Procurement Technical Assistance Centers PTACs provide free assistance in government contracting. They will help you identify bidding opportunities and if your company meets specific criteria to work with the government. You can also find out if your business can be certified as 8(a), WOSB., or HUBZone. New Bidding Techniques Auction — A government buying technique where the bidding continues until no competitor is willing to submit a far better (i.e., lower) bid. The method is usually mentioned as “reverse auction” because the govt is trying to find a rock bottom price, not the very best price. It is essential to research and ensure you can cover your costs in an auction process. However, do not get caught up in the moment’s excitement and make calm rational decisions. Bundling — a way where the government consolidates two or more requirements commonly bought separately into one contract. The support contracts of the many military bases, which require a spread of labor disciplines to stay at the bottom operating, are being bid in this manner. In bundling, make sure that you carefully read all the provisions. It is essential not to ignore the project management aspect of this type of bidding. The Bid The Federal government has the following type of solicitations for bidding: Request for Quotation (RFQ). This type is for contracts below $150,000 with a simplified acquisition procedure. Request for Proposal (RFP). This type of solicitation asks vendors to propose in response to the government’s request. You can (and often will) discuss delivery details, technical requirements, and specifications with the contracting officer when you bid on that type of solicitation. Invitation for Bid (IFB). The “lowest bid wins” or “sealed bid” type of solicitation. No discussion or price negotiation is implied here. Request for Information (RFI). This is primarily to research the market and evaluate the interest and capabilities of contractors in a specific niche. Be sure you read the solicitation requirements carefully. A solicitation package will include documents, technical conditions, attachments, and more. There are standard contracting forms for most federal government contracts under RFP and IFB solicitations. As for needed documents, they are listed in the solicitation. Contact your contracting officer if you have questions. You must understand everything about the solicitation you are bidding on. Also, look to FARs (Federal Acquisitions Regulations) that govern the solicitation you are to respond to ensure you know the regulations and requirements. Small Business Administration Certifications A Small Business Administration certification is an excellent way for your business to stand out in the marketplace. Certifications can help you access specialized funding and scholarships, allow you to compete for set-aside contracts, and can be a great bonus to potential clients. Here are some certifications to consider for your small business: Women-Owned Small Business Federal Contract Program (WOSBs) 8(a) Business Development Program The Service-Disabled Veteran-Owned Small Business Concern Procurement Program(SDVOSB) Historically Underutilized Business Zone Program (HUBZone) Networking Sometimes the most challenging step is getting your foot in the door. Networking is vital when trying to secure government contracts. The Small Business Administration (SBA) is a great resource and hosts many events throughout the year. These events are usually at no cost to business owners and can offer a treasure trove of information about obtaining contracts from various agencies.  This is your opportunity to shine, so make sure you are prepared to present an elevator pitch to define your company better. This speech explains what your business has to offer and how you can help another organization meet its goals. It should be short and simple, no longer than a 30-second elevator ride.

The United States Government Is A Very Powerful Client With Deep Pockets The Federal government usually spends billions of 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. Why Work For The Government? There are many compelling reasons to work for the Federal Government.  We will go into in-depth detail about how a small business can benefit significantly from being a government contractor. Being A Government Contractor Is A Great Way To Make Your Business Stand Out In An Overcrowded Field Business can be very competitive. Working on government projects is a great way to make a mark in an oversaturated market. The government has a great deal of work specifically set aside for small businesses. Also, many small businesses often do not want to deal with the hassle of working with the government, and sometimes there can be surprisingly little competition for a government project. That is why utilizing Sam Directory to handle all the confusing registration requirements is a very smart investment.  Never Underestimate The Power Of Relationships As part of understanding your customer, it is very important to build strong relationships within the government agencies. The government is not a giant cold faceless entity. It is made up of people and they will appreciate the opportunity to speak to you face to face. An impressive interview might win you a supporter that will lobby in your favor. A Fantastic Presentation Is A Key To Success Having a good presentation is vital to winning over the federal government. You want to be able to make an excellent impression that goes beyond just having a great price point. It is important to understand that this is not your typical business client. Because the presentation to the United States is so different from presenting to other businesses, many companies get flustered.  Let us guide you through this often intimidating process. Be Prepared To Give An Oral Presentation Oral presentations are very common for companies who want to work for the United States government. This is going to be a different audience. You might not get the greeting and niceties that usually come with this type of business meeting. The government employees are not allowed to react to anything that is said. You should be used to seeing no feedback until the question and answer period. You Still Need To Make Yourself Stand Out The federal government will watch many groups of people from various other companies. They have a point system and award the contract to the business that scores the most points. The government will often see the basic material being presented numerous times. Your presentation must be unique and memorable in a positive way. Your company needs to catch their attention. Small Business Administration Certifications A Small Business Administration certification is a great way for your business to stand out in the marketplace. Certifications can help you gain access to specialized funding and scholarships, allow you to compete for set-aside contracts, and can be a great bonus to potential clients. Here are some certifications to consider for your small business: Women-Owned Small Business Federal Contract Program (WOSBs) 8(a) Business Development Program The Service-Disabled Veteran-Owned Small Business Concern Procurement Program(SDVOSB) Historically Underutilized Business Zone Program (HUBZone) Special Programs Help is available from special small business programs that encourage participation by small businesses and help these businesses navigate the government contracting maze This includes small businesses owned by minority and traditionally disadvantaged groups. These programs, which are administered by the Small Business Administration (SBA), assist small businesses on how to obtain both large business and government procurements. Publications The government has issued some publications to also assist small businesses. They are as follows:  Selling to the Military: Has all the information needed about items the military is currently looking to purchase. This includes contact information for the buying offices and the Small Business Office. Small Business Specialists for DoD: This is a listing of names, addresses, and phone numbers for all the resources you need to do business with the Department of Defense which is one of the most well-funded purchasers in the government. Participating in the VA Acquisition Program: This publication covers general information about how and what the Veterans Administration buys. Understand The Chain Of Command In the private sector, you might have a boss or manager whom you report to daily. The chain of command is usually very straightforward. In the world of government contracting, you might have several people to report to, including managers from other contracting companies. There can be a steep learning curve when it comes to managing the expectations of several government employees at once.  However, there are endless opportunities and one can gain priceless experience by working with several agencies. Many departments in the federal government contain hundreds of agencies. These places have a wide variety of needs that can easily be filled by small businesses. Working with one agency often opens the door to other departments, making the scope of opportunities endless. How Do You Get Started Working With The Government? SAM stands for System Award Management. 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 that has not registered in the SAM directory. We have an article on our site, Everything You Need to Know About SAM for Small Businesses, that gives you important information about this process.  Is very important building As a smart… Continue reading Smart Ways For Small Businesses To Market To The Federal Government

What is the ASVAB? The Armed Services Vocational Aptitude Battery (ASVAB) is one of the most important exams for military personal. The ASVAB measures aptitude and intelligence for various branches of the military. Most people will take the test while they are in high school as teenagers. The military uses the ASVAB to determine how to place new recruits in the proper branch and job best suited to their skills. Education In order to enter the military one, must at a minimum possess a high school diploma or GED. The Coast Guard requires 15 college credits alongside a GED to be eligible for enrollment. You do not have to have a degree to take the test but without the minimum qualifications to enter the military, your scores will be useless. What is the format of the ASVAB? The ASVAB is a multiple-choice exam that is made up of nine different sections that in total take approximately 3 hours to complete. The sections of the test are as follows: Arithmetic Reasoning Word Knowledge Verbal Expression General Science Paragraph Comprehension Mathematics Knowledge Electronics information Automotive and Shop Information Mechanical Comprehension Assembling Objects The test taker will usually have more time with the reading-intensive questions that are often found in the Paragraph Comprehension portion fo the exam. These will take around 2 minutes per question to complete when compared to the 30 seconds per question of some of the other sections. Three versions of the test The MET-site ASVAB This exam is given at a Mobile Examination Test site. This test is used solely for enlistment into one of the military services. Test sites are located in different cities. You will need to be referred by a recruiter to take the MET-site ASVAB. The MET is a multiple-choice test where you write your answer on a separate answer sheet. Since it is a pen and paper test, answers can be changed. You are given a set amount of time, so you must do your best to answer all the questions in the time given. Unlike the CAT-ASVAB, you may not leave the testing room if you finish before the other testers. You should plan on spending several hours at the MET-site when taking this version of the ASVAB. Scoring the MET-site ASVABThe test administrator sends test results back to the MEPS. The test administrator will give you a sealed envelope, which contains your unverified test scores to take back to your recruiter. You will get your verified scores later oncer your answer sheet has been officially scanned in the system. Subtest Questions Time Content General Science (GS) 25 11 General principles of biological and physical sciences Arithmetic Reasoning (AR) 30 36 Simple word problems that require simple calculations Word Knowledge (WK) 35 11 The correct meaning of a word; occasionally antonyms (words withopposite meanings) Paragraph Comprehension (PC) 15 13 Questions based on several paragraphs (usually a few hundredwords) that you read Mathematics Knowledge (MK) 25 24 High-school math, including algebra and geometry Electronics Information (EI) 20 9 Electrical principles, basic electronic circuitry, andelectronic terminology Auto & Shop Information (AS) 25 11 Knowledge of automobiles, shop terminology, and tool use Mechanical Comprehension (MC) 25 19 Basic mechanical and physical principles Assembling Objects (AO) 25 15 Spatial orientation The CAT-ASVAB The CAT-ASVAB is very popular. This version of the exam is done on the computer which allows for flexible start times and self-paced responses. The CAT takes about an hour and a half. The exam covers the same materials as the MET-site ASVAB. It does divide Auto Shop into 2 subtests which consist of Auto Information and Shop Information. Computerized Adaptive Testing means that if the correct answer is chosen, the next question will be harder. If the answer given is incorrect, the next question will be easier. This also means that once an answer is selected on the CAT it cannot be changed. Although you can speed through the CAT at your own pace, the test does have a time limit. If you finish a subtest before the time limit is reached, you automatically go on to the next test. Unlike the MET-site ASVAB you may leave the test room as soon as you are finished. Scoring the CAT-ASVABYour CAT-ASVAB subtest scores are computed using formulas that take into account the difficulty of the test question and correctness of the answer. Test scores are good for two years. Subtest Questions Time Content General Science (GS) 16 8 General principles of biological and physical sciences Arithmetic Reasoning (AR) 16 39 Simple word problems that require simple calculations Word Knowledge (WK) 16 8 The correct meaning of a word; occasionally antonyms (words withopposite meanings) Paragraph Comprehension (PC) 11 22 Questions based on several paragraphs (usually a few hundredwords) that you read Mathematics Knowledge (MK) 16 20 High-school math, including algebra and geometry Electronics Information (EI) 16 8 Electrical principles, basic electronic circuitry, andelectronic terminology Auto Information (AI) 11 7 Knowledge of automobiles, and tool use Shop Information (SI) 11 6 Knowledge of shop procedures Mechanical Comprehension (MC) 16 20 Basic mechanical and physical principles Assembling Objects (AO) 16 16 Spatial orientation The Student ASVAB Explained The Student ASVAB is used for career exploration for high school and college students. This version is given in high schools, colleges, and vocational schools. This exam is done on pen and paper and is usually around 3 hours long. The result is then sent to your school so you can explore career options with your counselor (post-test interpretation). You will be given an inventory of interest in which you can use your exam results to identify a college major and explore different occupations that are available in the military. Scoring The Armed Forces Qualification Test Score (AFQT) is the percentile score given after the test is graded. This may seem confusing since you take the ASVAB, but the ASVAB gives you an AFQT score. The score of 31 is the lowest score allowed by any brach of the military.… Continue reading Everything You Need to Know about the ASVAB

The Federal Government Wants To Help Small Businesses Succeed Unlike other markets, the federal government wants to ensure that small businesses receive a substantial chunk of the $500 billion contracting pie. This makes the Federal government one of the most potent consumers of goods and services in the world, and they want to help small businesses win these contracts. Small Businesses Are Given Special Consideration When It Comes To Government Contracts In many markets, small businesses are often outcompeted by larger organizations that have access to almost unlimited resources. So this set aside might increase a small business’s chances of winning a lucrative bid. The federal government must set aside at least 23 percent of its total spending specifically for small businesses. As a result, several small companies have made a fortune just on federal government contract awards. The Federal Government Has Government Personnel That Are Strictly Utilized to Help Small Businesses Be More Competitive In Securing Government Contracts Here are some examples: SBA Procurement Center Representative (PCR): Procurement Center Representatives are often located at a significant government buying office, even though they technically work for the Small Business Administration. They will identify items and services that small businesses could produce or provide and try to get them “set aside” for small businesses, which means that only small businesses can bid for the contracts.  Competition Advocate: This person is responsible for promoting full and open competition at high management levels in the significant buying offices. They are supposed to challenge overly restrictive statements of work and contract clauses that can prove to be burdensome. They also try to expand competition for items by offering challenges to requirements that are not deemed necessary for the performance or essential physical characteristics.  Small Business Specialists (SBS): The law requires every government buying location to have a Small Business Specialist. These specialists work specifically with small businesses to help them do business with that office. Larger government offices might have entire staff, while smaller offices might only have a part-time person assigned to that task. Central government buying offices have full-time staff, while smaller offices have a part-time person assigned to that task.  SBA Commercial Marketing Representative (CMR): Commercial Marketing Representatives keep track of large companies working for their departments. These representatives are often the go-to for fantastic small business subcontracting opportunities.  It is wise to utilize this group of highly specialized government personnel as they are an invaluable resource for small businesses to obtain government contracts. Special Programs Help is available from special small business programs that encourage participation by small businesses and help these businesses navigate the government contracting maze. This includes small businesses owned by minority and traditionally disadvantaged groups. These programs, administered by the Small Business Administration (SBA), assist small businesses in obtaining both large enterprise and government procurements. Here is a list of websites provided by the government to help small businesses obtain contracting information. Counseling The government also offers more personalized guidance through counseling. There are also commercial counseling programs. The Procurement Technical Assistance Centers or PTACs offer valuable assistance to small businesses. They can be found in educational institutions. These counselors are well known for their expertise. There is also a government-backed membership organization called the National Contracts Management Association.  The PTACs help small businesses locate marketing opportunities and assist with various e-commerce issues. They can also help you prepare financial reports, procurement forms, and contractual paperwork and guide quality assurance. Most of their services are free though there can be a nominal charge for services such as electronic bid matching. You can contact one of the regional directors at The Association of Procurement Technical Assistance Centers for more information. In addition, the website www.sellingtothegovernment.net could help you locate a PTAC near you. National Contracts Management Association The National Contracts Management Association (NCMA) is a government-supported organization that started years ago (1959). It was created to help companies do business with the federal government. The organization provides certification programs and educational seminars for small businesses. They also print a monthly magazine called Contract Management. The fee for new membership is $120 and can be renewed at $100 per year. Small Business Administration Certifications A Small Business Administration certification is an excellent way for your business to stand out in the marketplace. Certifications can help you access specialized funding and scholarships, allow you to compete for set-aside contracts, and can be a great bonus to potential clients. Here are some certifications to consider for your small business: Women-Owned Small Business Federal Contract Program (WOSBs) 8(a) Business Development Program The Service-Disabled Veteran-Owned Small Business Concern Procurement Program(SDVOSB) Historically Underutilized Business Zone Program (HUBZone) How Do You Get Started Working With The Government? SAM stands for System Award Management. To do business with the federal government, you must register your business in the System for Award Management. In addition, the government will not hire any type of business that has not been written in the SAM directory. We have an article on our site, Everything You Need to Know About SAM for Small Businesses, that gives you essential information about this process. As an innovative entrepreneur, you have already used our site to register in the SAM directory. Congratulations on taking this critical first step to becoming a government contractor. How Do You Get Started Working With The Government? For example, the following are the steps to apply for a federal grant: Step 1: Obtain a DUNS Number Step 2: Register with SAM Step 3: Register with Grants.gov You might be wondering what SAM means and how you register with the site. Go to sam. Directory to find people willing to make this as easy as possible. Then, check out our informative article Everything A Small Business Needs to Know About the SAM Directory, which should quickly answer most of your questions.