Government Contracting: Everything you always wanted to know, but were afraid to ask
From the US Government Small Business Office
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Contracting Levels
Federal Government
Department of Defense (DoD)
Army - Navy - Air Force
Supply Centers Federal Civilian Agencies General Services Administration (GSA)
Veterans' Administration
Government Departments
Dollar "Thresholds"
Federal Acquisition Streamlining Act of 1994 meant that dollar thresholds were changed to:
- $2,500/Under: Micro Purchases - unrestricted, credit cards, "off the shelf"
- $2,500 - $100,000: Simplified Acquisition Procedures; reserved exclusively for small business concerns; use of credit cards and electronic commerce are maximized;
- Above $100,000: standard purchasing rules apply.
Electronic Commerce
EC - Electronic Commerce
EBBs - Electronic Bulletin Boards
EDI - Electronic Data Interchange
EFT - Electronic Funds Transfer
The Internet
Credit Cards
E-mail
EBBs - Electronic Bulletin Boards
- Used mostly by the Defense Supply Centers
- Contractor can view open solicitations and download solicitations and drawings.
- Contractor bids back through the EBB
- Requires computer, modem, on-line registration
- Phone connection generally not toll-free
- Some may require specific software to ensure complete access to the EBB
EDI - Electronic Data Interchange
- Paperless FEDERAL government contracting
- Short response time - usually the next business day
- Contract range is $100,000 and less
- Manufacturers/Wholesalers are best suited
- Requires a contract with a VAN (Valued Added Network). This is the contractor's link to all federal government EDI bidding opportunities. VAN secures the contractor's bid. Cost $$$.
- Requires a computer, modem, VAN, and special communications software.
EFT - Electronic Funds Transfer
- Money electronically deposited in your checking account
- Payment usually within 10 days
- Payment by EFT became mandatory January 1, 1999; with exceptions.
- Very routine
The Internet
- Bid opportunities are posted to agency web site
- Contractor can download solicitation, drawings and specifications
- Contractor bids through agency web site
- https://oamp.od.nih.gov/acquisition-offices/contract-tool-box/federal-links
- Federal Acquisition Jumpstation
Credit Cards
- Standard VISA/Master Card
- Used for purchases less than $2500 - "off-the-shelf" items
- Some agencies are purchasing up to $100,000 per transaction on their cards
- Often the best way to contact a buyer/get needed information fast
- Bypasses the dreaded "voice mail"
Specifications
- Going from military to commercial specs
- Going from design specs to performance specs
- Use of "off the shelf" commercial items in simplified acquisitions
How to get started
- Target Your Market
- Federal Agency Forecasts
- Be Competitive
- Be Persistent
- Be Patient
Things needed to get started
- Federal Level
- Register in SBA's Pro-Net https://www.sba.gov/user/register
- Central Contractor Registration - DOD
- Register with agencies that buy your product/service - SF 129
- Search for bidding opportunities
- Accept EFT and credit cards
- Become a client of a PTAC
Things to do when starting
- Network, Network, Network
- Meet your buyers - if at all possible
- Need to establish a relationship with the buyer
- Attend conferences/workshops when possible -
- SBA Calendar of Events https://www.sba.gov/ombudsman/calendar-events
Find out how the agency contracts
- Purchase Orders
- Basic Ordering Agreement
- Indefinite Delivery/Indefinite Quantity
- Fixed Price Contracts
- Credit Cards
Do a test run
- Request a solicitation
- Are you competitive?
- Watch for the award and compare your pricing
- Always read ALL the rules that apply to your particular procurement opportunity - Federal Acquisition Regulation https://www.acquisition.gov/browse/index/far
- Always follow the prescribed procedures
- Questions should be directed to the Contracting Officer
You're ready to bid
- Read the solicitation CAREFULLY!
- Request a "Buy History" if available
- Get clarification in writing of any ambiguities or mistakes in the bid package
- Attend pre-bid meetings (construction and service contracts)
- Do a walk-through if possible (construction and service contracts)
- Get all your key players involved in preparing your bid
- Have someone unfamiliar with the solicitation proofread your proposal/bid (does it make sense?)
- Submit your bid on time in the prescribed manner
- Contract Award
- Are you the low bidder?
- Are you Responsive?
- Are you Responsible?
- Pre-award Survey - Be prepared to be audited
-
When you bid on a government
contract you give up your
customary right to privacy. A
team of experts will tour your
facility to validate:
- Technical capability
- Production capability
- Quality assurance program
- Accounts receivable
- Inventory control
- Net worth of the business
- Line of credit
- Cash flow
- Accounting system
- System for qualifying suppliers
- Packaging, marking and shipping
Certification
Federal Level- Small Business (self-certify)
- Woman-owned Business (self-certify)
- Self-Certification is not questioned until a competitor or other interested party protests
- SBA certification Small Disadvantaged Business (pre-certification)
- SBA 8(a) Program (pre-certification)
- SBA Hubzone certification (pre-certification)
- Set Aside Programs
- "Set Aside" contracting dollars
- Rules have changed drastically
-
Three Set Aside categories:
- Small Business Set Asides (SBSA)
- SBA 8(a) Contract Set Asides
- SBA Hubzone Set Asides
-
Other factors in the equation:
- SDB Price and Evaluation Factors
- Goals
- Set Aside Programs (cont.)
- SBA 8(a) Program
-
For socially and economically
disadvantaged businesses
- Must be a small business (13 CFR Part 121)
- Nine year program - graduation
- Must be in business 2 years to apply (waiver)
- SBA Certification is required
- Certification recognized also as SDB certification
-
Sub-Contracting
- Register in and use Pro-Net
- https://www.bpn.gov/ccr/scripts/index.html
- Get list of Prime/General contractors in area and market to them
- SBA Subcontracting Directory http://www.sba.gov/gc
- Attend as many small business conferences/workshops as possible
- Networking - most important aspect
Should I market to the Government?
- Do you have a product or service that the government already buys?
- If so, why should they buy from you rather than their present supplier?
- Small business preference
- Fast delivery
- Low overhead/lower price
- Are you the only supplier/distributor?
- Do you have a new item?
- Who is the government end user?
- Who makes the decision to buy?
- What is process to introduce a new item? Is testing required?
- Judgement call: Is it worth your time and effort to introduce the new item?
Where can I go for help?
-
Procurement Technical Assistance
Centers PTACs provide:
- Free one-on-one contracting counseling
- Forms and more forms
- Automated federal buy history
- Automated bid matching
- Specifications and Standards
- Government contracting resource library
- Information on eContracting
- Assistance with certification programs
- Contract administration guidance
-
SBA assistance available
- Office of Government Contracting
- Procurement Center Representative (PCR)
- Commercial Market Representative (CMR) http://www.sba.gov/gc
- Office of Minority Enterprise Development
- 8(a) and SDB Programs http://www.sba.gov/MED
- Office of Women's Business Ownership https://www.sba.gov/offices/headquarters/wbo
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Popular terms (Glossary)
Contract Award: Occurs when the contracting officer has signed and distributed the contract to, or notified the contractor.
Commerce Business Daily: A Department of Commerce publication used by federal agencies to publish a summary or synopsis of their upcoming procurements to notify interested businesses. Now largely replaced by the Fedbizopps internet site.
RFP - Request for Proposal: A process where an agency or government can seek a specific proposal from vendors. Follows a specifications process and formalized set of standards and procedures. Generally seeks less vendor input than an RFI but more than an RFQ.
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