How to Do Business With The Federal Government
Working With The Government
If you own a business and would like to increase your income, or if you have unique talents and skills that you believe the government could benefit from, you may want to make some money from them. The government sets billions of dollars aside for small businesses every year, so it's only fair to get your piece of the pie. Although the idea of working for the Department of Defense, Local, or State government may sound intimidating, it shouldn't be, and there are a variety of ways the local populace can help them out with every day.
It's my job to hire contractors every day for the government. I love it. I love setting aside money for small businesses to reap the benefits of, as opposed to large businesses, who don't necessarily need it. If I award a contract for $40,000 to a mom and pop dry cleaning service, it benefits them in a way that could make or break their company. If I award it to a multi-million dollar corporation, it really doesn't make a dent. That's why I love my job, and it happens all the time.
There was an older lady who saw that the government was looking for a dry cleaning service, and she called the office and said "I can do that. How do I sign up?" We talked her through the process and she began by just washing linen in her washing machine, and with the money she made, she grew and made a successful business. Another example is the following: Our base needed water towers repaired. There was a man who knew he could do it. He and his friend signed up, hopped in his truck, and did work all over the country repairing towers. So, no, you do not need to be a large corporation. If you have a talent or skill that the government can benefit from, you might as well make money off of it.
First Thing is First
The first thing you'll need to do is obtain a DUNS Number. It's free, and if you have multiple locations of your business, you'll need one for each location. You can click the link to read more about it.
The Data Universal Numbering System or D-U-N-S Number is Dun & Bradstreet's copyrighted, proprietary means of identifying business entities on a location-specific basis.
Assigned and maintained solely by D&B, this unique nine-digit identification number has been assigned to over 100 million businesses worldwide.
The DUNS Number remains with the company location to which it has been assigned even if it closes or goes out-of-business.
Register Your Business with SAM
SAM is a government wide database of vendors doing business with the federal government.There is a regulation for the government that states this MUST be done. If a vendor (contractor) doesn't register or is not registered in SAM, the government cannot do business with them.
In SAM, you will give a lot of information about your business. It will tell the government whether you're a small business, a veteran owned business, a woman owned business, a service-disabled veteran owned business, and other classifications which can get your business preference over others. What happens is the government determines they have a need, and there is an administration that determines whether this requirement needs to be set aside for a certain business type. Then, the contracting officer will act accordingly, with the small business usually getting preference.
To register, go to www.sam.gov.
Usually the government will purchase what they need based off of a dollar amount. If it's under a certain amount, they will seek out a certain number of contractors, and just call them or email them to get a quote about what they need. For higher dollar amounts, they will post the requirement on a public website (more on that later) for many contractors to place bids/quotes/proposals. SAM allows the government to find contractors near their location when they need to contact them directly, which makes their job much easier.
Find Your NAICS Code
NAICS stands for North American Industry Classification System. It basically gives a small rundown of what you do. This also helps determine the size of your business. For example, the size standard for a company that does Janitorial services may be 750 employees, but it may be only 500 for a company that manufactures computer equipment. Or it could be a dollar amount rather than employees.
To determine what your NAICS Codes are (you can have more than one), go to http://www.census.gov/eos/www/naics/.
Be sure to do your homework. The more NAICS Codes you use, the more opportunities you can have.
Register For FedBizOpps
FedBizOpps (FBO) is what the government uses to put out publicly what is needed. This opens the competition up for everybody. To register, go to fbo.gov, and fill out your information accordingly. This another area where your NAICS Code is important, because when a specific service/item is needed, the government will input a NAICS Code, and the information will be sent via e-mail to all vendors that are registered.
Usually, there will be a presolicitation that will be put up there first, stating that the government is intending to post an opportunity, and to let everyone know it's coming. Then, within a day or so, the solicitation will be posted. Vendors can now see the specific specifications, as well as provisions that the contractor will need to follow in order to fulfill the contract. After a few weeks, all the quotes will be evaluated, and whoever is the lowest bidder (or whoever has the best value product) will win the award. The winner of awards will be announced publicly for all to see, including the name of the business and the dollar amount of the award. This allows for businesses that are new to government contracting to evaluate what happened, and they can determine what can be done to try to win the next one.
Now that you have won your first government contract, it's time to begin your performance! Before you do, make sure that you have a SIGNED contract. The contract looks similar to the solicitation document posted to FBO, but should have clauses in it rather than provisions. You can accept the contract by either signing it, or by beginning performance. It's preferred that you sign it and send it back to the government, though. Beyond that, it's up to you. You're the expert at your job. It's up to you to do your best so that the government returns to you for more work.
Also, be aware that the government does keep track of performance. Past performance is an evaluation factor, so if you're a poor working contractor, and you post a quote that is slightly lower than the next lowest bidder, you can get skipped over.
Below are some of the items that you will need in order to complete registration processes.
Your NAICS codes
Your Data Universal Numbering System (DUNS)
Your Federal Tax Identification Number (TIN or EIN)
Your Standard Industrial Classification (SIC, similar to NAICS)
Your Product Service codes (optional but useful)
- Your Federal Supply Classification codes (optional but useful)
Remember, everything is FREE. You just have to do some homework to get the best outcome. If you run across anything during this process that requires you to spend any money, be weary.
Also, note that the government likes to have a positive working relationship with contractors. Don't fear getting screwed into a bad contract. That being said, be sure to read the contract. Usually, they tend to give a wide latitude of freedom regarding contracting, because you are the expert. They don't tell you how to do something, they just tell you what the results needed are, and expect you to deliver. But- sometimes a job does require specific work, so be sure to read everything needed before placing a quote.
Lastly, the government follows a strict book/website of regulations as far as writing contracts. This is found for free at farsite.hill.af.mil/. It's extremely confusing, but if you'd like to become a contracting expert, feel free to read through it. Its the contracting bible.
Good luck with your business future. If this article helps even one person take their business to the next level, I've done my job. Again, good luck, and maybe we'll work together some day!