Though billions of stimulus fund dollars are being allocated for government contracts, many small business owners are still unaware of how to strategically win bids.
Back in February, President Obama penned the Recovery Act, flooding the economy with $787 billion to be spent on the nation's health, education, energy, and infrastructure needs. Most of that money will be spent in 2010, and many small businesses are eager to get a piece of it. However, the federal contracting system remains daunting to those small business owners who are not familiar with the process, and the tools and resources available to help them navigate it.
According to Lourdes Martin-Rosa, the American Express (AMEX) OPEN advisor on government contracting, the United States federal government is the largest purchaser of goods and services in the world, and small businesses already have an edge in government contracting. They just need to know where to start, she says.
"Twenty-three percent of all the federal government's expenditures must be spent with small businesses," Martin-Rosa explains. "That means that if the federal government is tripling their spending, there are more opportunities for small businesses out there."
The process of doing business for the federal government is competitive because the money is plentiful and the work is generally consistent. In order to even be considered for a federal contracting bid, every small business must first register with the Central Contractor Registration (CCR), which is the primary registrant database for the federal government. The CCR stores company information for hopeful small businesses, and disseminates that data to agencies looking to hire contractually.
Businesses must then submit a bid for each contract, and they can learn about contracting opportunities through several websites, including FedBizOpps.gov, which publishes all federal contract solicitations with a value of $25,000, while the U.S. General Services Administration (GSA) Scheduling Program establishes the largest government-wide contracts. Then, federal officials will decide on procurement based on a company's proposal and the business's general proficiency.
"The biggest obstacle that I see is that [small business owners] do not prepare their companies properly," Martin-Rosa says. "They do not go on the different websites to get knowledge on positioning themselves in order to win government contracts, and they do not get their companies' contracts ready."
Martin-Rosa, who is also president and CEO of the Miami, Florida-based consulting firm Government Business Solutions, suggests that networking is another way to learn about and win contracts. She advises that small businesses owners become involved with organizations, such as the 'Give Me 5' program, co-sponsored by AMEX OPEN and Women Impacting Public Policy (WIPP), which provides federal contracting information for female business owners. Other groups, such as the Business Matchmaking Online Network, can match contractors with sub-contractors.
Kris Wittenberg, owner of SayNoMore! Promotions, an Eagle, Colorado-based promotional marketing firm, is one small business owner who has been researching the federal procurement process with the hope of winning a bid. She says the process is still relatively new to her, since her industry typically does business through orders rather than contracts, but she has been attending several networking and government contracting events in an effort to better understand the system.
"I believe the most helpful advice I received about government contracting was the power of networking and building relationships," Wittenberg says. "I have attended events sponsored by WIPP, the 'Give Me 5' program, and I have enrolled my company with the CRR. And, we have been working with the State Department, the IRS [Internal Revenue Service] and the Government Printing Office (GPO) to learn more about obtaining contracts."
Although, Wittenberg says she has not been able to dedicate nearly as much time as she would like to win a bid, she will continue attending government contracting events, and she is looking to get SayNoMore! on the GSA's schedule. "It does take some time, and a certain set of operating procedures. We haven't won a contract yet, but I remain hopeful that we will secure a bid," she adds.
For more information on understanding government contracting, visit:
Registering with the CCR grants access to small businesses that are searching for federal contracting opportunities. In registering, small businesses supply their company information and statements of their expertise, which can then be viewed by contracting officers, prime contractors, and the general public.
• Fed Biz Opps, or Federal business Opportunities: www.fbo.gov Fed Biz Opps maintains a database of active federal opportunities, which allows government users to post, manage, and award opportunities, and vendors and citizens to search, monitor and retrieve opportunities.
• The Office of Management & Budget: www.usaspending.gov In accordance with the Federal Funding Accountability and Transparency Act of 2006, a searchable website is required to be made publically accessible for every federal award. Here, detailed records are available to small businesses and government officials so they may obtain information about the business receiving the award, how much the award is for, the business's location, and additional information.
• AMEX OPEN & WIPP's 'Give Me 5' Program: www.giveme5.com The 'Give Me 5' program was established to help facilitate stipulations from The Equity in Contracting for Women Act of 2000, which specifies that federal contracting officers award 5% of all contracts to women-owned businesses. This national program was designed to educate female business owners on how to apply for and secure federal procurement opportunities.
• The General Service Administration's Schedule Program: www.gsa.gov The GSA oversees the business of the federal government, and delivers products, services and policies to federal customers. The GSA Schedule Program establishes government-wide contracts with commercial firms, and allows for small businesses to be considered for sub-contracting positions.