What Is A Government Contractor?
The United States Government is made up of several agencies that require a variety of services. These agencies then offer contacts to private companies across several industries to fulfill these needs. Private contractors are vital in helping the government provide services for the welfare and protection of United States citizens. Private government contractors provide goods and services for the following:
- Medical ServicesUtilities
- Construction
- Supplies for various projects
- Engineering
- Defense
- Intellectual Technology
- Energy
These are just a few of the categories that are often contracted out to private independent companies through the awarding of government contracts.
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 greatly from being a government contractor.
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)
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, many small businesses fail to realize that the government has an abundance of websites to help them find these government contracting opportunities.
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.
What Does This Mean For Small Businesses That Want To Be Government Contractors?
The Federal government is also required to set aside a certain amount of contracts for small businesses. At least 23 percent of government contracts will be awarded to small businesses this year. This means that smaller companies do not have to worry about being outcompeted by large companies with unlimited resources.
How Do I Know Government Contracting Is Right for My Company?
There is very little certainty in business. Having a powerful client that is known for paying its bills on time, like our Federal Government, is a great asset.
Also, many of your competitors might be dismissing the idea of being a government contractor as being 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.
Work Environment
Government contractors can work in a wide variety of environments, depending on what service they are providing. A tech company might be consultants on large-scale computer-oriented projects. Where an energy company might be on oil rigs supervising the drilling mechanism needed to complete the work.
Contractors who do well and maintain good reputations often are guaranteed to participate in future projects.
Certification and Education
Usually, the agency sets specific educational and certification guidelines when they post a request for proposals or RFP. These requirements can vary depending on the type of work that is needed. However, there are some steps that any business can do to become more attractive for government contracting work.
Make Sure You Establish A Good Business Reputation
We have already mentioned that a certain number of federal contracts are always set aside specifically for small businesses. The Small Business Administration or SBA has reported that the United States government buys almost 100 billion dollars worth of goods and services just from small businesses each year. This large amount does not even include the money spent on contracting at the state or municipal levels.
Try to establish a network of government contacts at various agencies. These contact can often serve as invaluable advocates for your business. They can also give you advice on how to navigate the bidding process. After your receive awards, make sure you work hard to establish a track record of reliability and success.
Do Not Give Up!
At some point, the process can be a little overwhelming. You must keep in mind that the reward will definitely 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 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.
How Do You Get Started Working With The Government?
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 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 smart entrepreneur, you have already used our site to register in the SAM directory. Congratulations on taking this important first step to become a government contractor.