Recent research conducted by the American Small Business League and the SBA’s Inspector General found that Apple, Chevron, Shell, General Motors, General Electric, Coca Cola, Bank of America, and 65 other giant companies got three out of every four “small business” contracts offered for bid by the federal government.
Despite many government reports documenting the problem and president Obama’s pledge to end this practice, large businesses are able to deceptively maneuver government agencies to count contracts performed by them towards their small business goals.
Large firms win where small businesses fail because they have “well-oiled machines” that know the ins and outs of the government’s contracting rules and regulations. Small businesses don’t enjoy the luxury of having a whole team dealing with applying for federal contracts, and therefore they are left lagging behind companies that shouldn’t even be in the race. I thought some tips would come in handy, so here are a few things you need to do when trying to win a government contract.
Make Yourself Known to Government Agencies: You need to make sure government buyers are aware of your company and its strengths, even before you actively pursue a specific government contract. Small businesses need to view a government agency as a customer and market themselves to the agency, so that when they do apply for a contract they already have a good reputation in the agency. Networking is a great way to put your business out there. Attending conferences, events, and seminars held by government agencies can help you better understand current and future government’s needs and make connections with decision-makers.
Think Like the Government: The government thinks of your business as the provider of an end product. Unlike companies that are more familiar with the process needed to manufacture a certain item, governments know the item they need but have no idea what it takes to manufacture it. Also, the people you face when bidding for government contracts are buyers, not engineers. It is important to keep all of these factors in mind and think in terms of output rather than process. Another part of thinking like a government is being aware of changes in the government’s interests. You need to be informed and track changes in the government’s interests and focus points. Because these usually change according to the state of the market, being up to date on economic, political, social, and environmental changes can open more contracting opportunities for your business.
Register Your Small Business Properly: If you want to start applying for contracts relevant to your field of business, you need to register your business appropriately. First, you need to select your North American Industry Classification System code—also known as NAICS code—and determent your small business size standard based on it. Next, register to get a DUNS code, a free identifier that will help the government track your business globally. Lastly, register with the Central Contractor Registration database so contracting officers can locate your business when looking for small businesses to fulfill contracting requirements.
The world is not perfect. Small businesses are not getting all the federal contracts they should be getting, and both government agencies and large corporations carry some of the blame for this. However, when operating in this current reality, small businesses can optimize their chances of winning a contract by making themselves informed, visible, and available.