How to Become a Government Contractor

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Search opps. To sell more rarified products and services, you will have to hunt down solicitations at FedBizOpps.gov, which, like the FPDS, allows you to search by contracting agency, product or industry codes, and much more. Stoltzfus recommends looking in FPDS for past contract awards that are due to expire. When you find one, says Stoltzfus, "contact the buying agency to see if the contract will be rebid -- and, if so, position your company as a potential bidder by researching the previous solicitation, contract, and needs of the agency."

3. Place Your Bid

Government bid solicitations can be daunting. With attachments, they can easily run a hundred pages. Read them carefully. The government takes all its rules seriously -- you can be disqualified from participation for submitting an offer that is, for example, too long.

Make sure, too, you understand all the terms of the proposed contract. Many of these will be stated in the solicitation, but many others will be incorporated from other sources, particularly the Federal Acquisition Regulation, the set of rules that govern procurement. Don't waste your time with the entire FAR, but be sure to read the contract provisions that are referenced in the solicitation.

It is possible to outsource this work to government procurement consultants, who tout their contacts as well as their savvy at navigating the system. Just be wary: Consulting fees can erode the already thin profit margins on government contracts.

Learn from your mistakes. If your offer is not accepted, ask for a debriefing from the contracting agency. "Most times, they will give it to you," Stoltzfus says. "And they will tell you what you did wrong, why you weren't chosen. That's a very important thing that you should take advantage of."

The Disadvantage Advantage

The government must set aside contracts under $100,000 for certified small businesses. And regulations often encourage procurement officers to reserve larger contracts for small companies. Certain classes of disadvantaged small businesses get more generous treatment, including access to set-asides, which limit contenders to a certain class of business, and sole-source contracts, which are negotiated with one provider rather than bid out.

HUBZone

Who qualifies: Small businesses in a designated low-income area (or Historically Underutilized Business Zone). At least 35 percent of the company's employees must also reside in a HUBZone.
Benefits: Limited-competition contract preferences; price evaluation preferences that allow winning offers to be up to 10 percent more than a large company's offer; special consideration for subcontracting opportunities.

8(a) Business Development Program

Who qualifies: Companies in business for at least two years with a majority owner and operating manager who are socially and economically disadvantaged -- certain ethnicities automatically qualify -- and whose net worth (not counting the value of a home or the business) is less than $250,000.
Benefits: Limited-competition and sole-source contract preferences; mentoring programs that can lead to additional subcontracting opportunities; joint-venture provisions that offer access to larger contracts.

Service-Disabled Veteran-Owned Business

Who qualifies: Any business managed and majority-owned by a veteran who is considered disabled by the Department of Veterans Affairs.
Benefits: Limited-competition and sole-source contract preferences.

How to Sub

To win contracts worth $550,000 or more, large businesses must establish robust goals for small-business subcontracting. And subcontracting lets small companies reap some of the profits of government contracting without nearly as much paperwork. It's also a good way to learn the ropes and build networks to win prime contracts.

Where to find the work The SBA's SUB-Net database (web.sba.gov/subnet) posts subcontractor solicitations online; the agency also culls plans in big contracts to produce a Subcontracting Opportunities Directory, by state. The GSA's eLibrary allows users to sort vendors for each schedule by state. But the best way is simply to go out and meet prime contractors, just like you do procurement officers. Any prime contractor with a subcontracting plan is required to designate a liaison to small business and make the contact information public.

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