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Government contracting may seem a bit daunting at first, so we are bringing it back to the basics! This blog will cover the most common FAQs concerning contracting with the United States government, so that you have a better grasp on the marketplace you are getting into. The first thing to fully grasp is that the United States government is the world’s LARGEST spender. It spends trillions of dollars each year to buy all types of products and services through contracts and grants. With this in mind, we can jump into the nuts and bolts of government contracting and check out how you can win your piece of Uncle Sam’s pie! 

What does government contracting even mean?

Government contracting is really, exactly what it says. The government needs goods and services that it can’t produce on its own, so it enters contracts with businesses large and small that can provide them. 

A government contractor is any private company that competes for (and wins) a government contract from any level of government: federal, state, or local. The government contractor could win the contract in a few different ways, but one of the most common is by submitting the lowest priced bid in response to a solicitation. Ultimately, government contracting professionals decide which offer received in response to the solicitation represents the best value to the government, and awards the contract to that winning bidder. Best value evaluation strategies may include “trade-offs” when necessary to consider price and other factors like technical, delivery, and overall management. 

Companies submit a response to a solicitation in accordance with the instructions outlined by the government. It is very important that companies read and understand these instructions because they must be followed precisely or the bid can get thrown out for non-compliance. Sometimes offerors are instructed to write significant technical volumes and complete pricing spreadsheets; other times, especially for simplified acquisitions, oral presentations are accepted.

Why does the government contract?

The U.S. government, across all levels, needs goods and services. They have responsibilities and duties to fulfill for the good of the people, which often requires the need to purchase a lot of products and services from businesses. For example, the Department of Defense solicits for radio test sets, cybersecurity services, and software management services. The Department of Homeland Security also seeks contracts for security technology, engineering services, and artificial intelligence products. There are thousands of other requests the government is constantly in need of – really anything from paper and pencils to microchip technology. Chances are, whatever you are providing, the government is seeking! If you don’t believe us, check out our contracting opportunities database on GovShop, a platform we built to connect buyers and suppliers in the public sector.

Is engaging in government contracting worth it?

The short answer is a resounding yes, but you have to be purposeful in your approach and methodical in your business development. Going from zero government experience to winning your first government contract is quite a journey, and can cost you a lot of time and money. If you are serious about this market, review these free resources to ensure that a) government buys what you intend to sell and b) you appreciate how much effort is involved in pursuing these opportunities. 

Once you decide to take the plunge, there are some ways to shorten your path to success. Most federal agencies have a dedicated office specifically to seek contracts with small and disadvantaged businesses. The government is concerned with contracting with small businesses to help ensure that large corporations don’t “muscle out” small businesses. Furthermore, the government agencies will set aside a percentage of their contracts (acquisitions) to save for contracting with these smaller businesses. If you qualify (check out this blog here→ How to Become a Government Contractor: The GovShop Guide to SAM Registration, you have a real chance of scoring contracts with the federal government — so worth it! 

Public procurement creates opportunities for many businesses to compete for and win long-term contracts. If you can successfully navigate the government registration process, you’ll have opportunities to earn a nice, steady cash flow with strong profit margins. And better-yet: the government is a very safe client and always pays their bills! If you are a small business, many contracts are relatively easy to win if you take advantage of government set-asides and covet the full benefits and pay as if you were competing with the big dogs. 

If we haven’t convinced you yet, there are still plenty of other reasons you should consider government contracting, and maybe even the entire sector of public procurement. As you successfully complete an acquisition, your company’s value increases. Your company will look more desirable to future clients because of your experience working with the government, and the door to networking opportunities starts working for you instead of against you. Yes, the solicitation process can be tedious and extensive, however, the government reserves billions of dollars for contracts each year. With adequate diligence in the bidding process, you will soon find yourself in a lucrative position to be the government’s next supplier for a certain entity.

With patience, persistence, and a solid foundation of federal acquisition rules, government contracting has never looked better. Check out our 10 Week Bootcamp Course to get started on your path to Government opportunities.

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