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
• http://nais.nasa.gov/fedproc/home.html
• 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

Email

• 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.bpn.gov/ccr/scripts/index.html
• 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 http://www.sba.gov/ombudsman/calendar.html

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 http://www.arnet.gov/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 http://www.onlinewbc.org

Another success story: The Kloke Group

For Jack Kloke, the right opportunities + the right information = SUCCESS. This winning formula can work for you too.

>  Read the entire case study GovernmentBids.com helps The Kloke Group get down to business

 

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