Becoming a Government Contractor
Moving Into Government Contracts
By: Theodore P. Watson, Esq. Government Contract Attorney
As the economy becomes tougher, more and more businesses are seeking to venture into government contracts as a way of sustaining long-term income. This is a very lucrative business venture. However, contractors must also be aware of
the federal procurement rules
If you are a new business, or even an existing business, becoming a contractor with the federal government is pretty easy. Unlike state government contracting programs, the federal government has a virtually free process. The Federal Acquisition Regulation (FAR) only requires a business to be registered at www.ccr.gov.
The government generally advertises contracts over $2500,000. www.fbo.gov is the focal point for all government agencies to advertise government contracting requirements.
Q: Do I need a business plan or other documents to be a government contractor?
No. Government contracting, unlike most state programs is a relatively easy process you do not need a business plan or tax filings to become a federal contractor.
Q: After I register, what else do I need to do to become effective at government contracting?
After registration, the key is developing simple marketing material and a strong capability statement. You must be able to articulate to the government contracting officer what services or products you offer. Have a separate page with your NAICs codes. This series of six numbers spells out the industry for which you offer services or products.
Q. Can only small businesses perform government contracts?
No. However, the Small Business Act suggests that the government contracting agencies offer contracting opportunities to small businesses if there is reasonable expectation that two or more small businesses will submit an offer.
There are some industries where statistics show that large businesses can perform more effectively For example garbage services are generally open to large government contractors to bid. This is called “full and open competition.”
Q: What if I have no previous experience; can I become a government contractor?
Yes. Congress receives the majority of taxes from small business. Thus, it would be counter-intuitive for it to only require small businesses that have previous past performance to qualify to become a government contractor.
Government contracting law states that if a bidder submits a bid but has no past performance, the contracting officer shall give you a neutral rating. In other words, you cannot be given a negative rating.
Q: How do I overcome a lack of previous experience when bidding on government contracts?
Government contract law allows businesses to team with other companies and create joint ventures in order to perform government contracts. You should seek out qualified businesses that have the past performance, equipment or other resources that you can compliment each other on.
Q: Do I need to acquire professional consultants to become a government contractor?
This answer depends on your business goals, budget and contract initiatives. If you have a budget, it may be wise to secure a professional government contracting consultant that understands the process. For example our firm offers training for large corporations. However, we also consult with smaller businesses that don’t have large budgets but still need to be pointed in the right direction.
Do I need to hire an attorney if I choose to go into government contracting?
Government contract law has many winding rules. However, it is not necessary to hire a government contract attorney right away. As you learn the process for an experience federal consultant, you may want to retain outside counsel in order to have questions answered as they arise.
During public speaking engagements and government contract training seminars, our lawyers typically suggest that when you are awarded a government contract, you should at a minimum consult with an attorney to understand what contractual obligations you have to fulfill.
What are the chances of me getting a government contract?
Although nothing is guaranteed, you can increase your chances but having experienced government contracting persons on your team. There are numerous statistics that show first timers are awarded government contracts. The government contracting rules even allow for an emerging small business category. Here, the contracting officer can award projects at $25,000 or less without consideration of past performance. I would say that your chances (given that you have strong advisors) can range from 50-60% Knowing how to market to the government is the first priority. Learning how to be competitive and present your business to the agency is also paramount.
For instance, our team has actually assisted clients that have never been engaged in government contracts in awards. Therefore, it is not impossible to do. Knowing how the game is played is critical. Remember, a contractor should not market to the federal government in the same manner as in the commercial sector.
For additional questions feel free to contact our office at 720.941.7200 or visit our main government contracting website
