How SAM Can Lead To Economic Stability For Small Businesses

March 14, 2025

 Small businesses are an integral part of the US economy, and the federal government is a major source of business opportunities for them. Working for the federal government can provide small businesses with a steady stream of income, access to new markets, and the chance to build relationships with other businesses. Additionally, working with the federal government can help small businesses gain valuable experience in managing large-scale projects and dealing with complex regulations. By working for the federal government, small businesses can leverage their resources to grow their operations and create more jobs in their communities.

What Is Government Contracting?

Government contracting is when specific government agencies contract with private companies for specific goods or services. The agencies usually put out a contract or often a request for proposal (RFP) and various companies can place bids for the project. Once an agency selects a particular business, a contract is signed, and that business is now considered a government contractor.

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.

As a savvy entrepreneur, you have already used our site to register in the SAM directory. Congratulations on taking this important first step to becoming a government contractor.

Registering With The SAM Directory Also Has Other Important Advantages

You must register with the SAM directory to apply for government grants.

A grant is 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 many other programs listed in the Catalog of Federal Domestic Assistance (CFDA).

A grant is different from a loan in that it is money that your business does not have to pay back. So, registering for the SAM directory gives you access to free money!

Small Businesses Are Given Special Consideration When It Comes To Government Contracts

In many markets, small businesses are often outcompeted by larger organizations with 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 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 underserved groups to have a real chance to get awarded lucrative government contracts.

Small businesses are essential to the growth and success of the US economy. As a result, the federal government is always looking for small businesses that can provide goods and services to help it fulfill its mission. Working with the federal government can be a great opportunity for small businesses to gain access to new markets, increase their visibility, and expand their customer base.

How Do I Know Government Contracting Is Right for My Company?

There needs to be more certainty in business. A powerful client known for paying its bills on time, like our Federal Government, is a great asset.

Also, many of your competitors might dismiss being a government contractor as too much trouble. This means that there could be surprisingly little competition in some spaces. Their shortsightedness can be your company’s advantage to get ahead and obtain some very lucrative contracts.

The federal government offers many incentives for small business owners who are interested in working with them. These include access to grants and contracts, tax credits, favorable loan terms, and more. By taking advantage of these opportunities, small business owners can not only grow their own businesses but also contribute to the economic well-being of their communities.

Working for the federal government can be a great opportunity for small businesses, as it provides them with access to lucrative contracts and a larger customer base. With the right strategies in place, small businesses can take advantage of this opportunity to expand their reach and increase their revenues. Not only will they benefit from the potential financial rewards, but they will also gain valuable experience in dealing with government regulations and procedures. Working for the federal government is an excellent way for small businesses to grow their business while helping the country at the same time.

Understanding The Marketplace

It might initially feel like working for the government is unpredictable. Contractors can be affected by various factors, such as budget cuts, regulatory pressures, changes in administration, and stringent accounting rules.

However, all marketplaces can be volatile and change rapidly according to the whims of consumers. A company needs to ensure that they have a deep understanding of the end buyer and why they want to use its products and services.

This is also true for the United States Government. You will need to develop relationships and cultivate trust that allows you to showcase your competitive advantage. Strategically managing the right relationships might guarantee the federal government a solid client that can assure your business of a bright future.

Government Contracts Can Be Very Lucrative For Small Businesses

The United States government issues 500 billion dollars in federal contracts every year. They also set aside 23 billion dollars specifically for small businesses. However, many small businesses find winning government contracts daunting and give up before even trying. 

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.