On a typical day, there are between 25,000 and 30,000 active government contracts available on the Federal Business Opportunities website. For entrepreneurs and small business owners, this amounts to thousands of chances to grow your company with the help of the federal government.
While you may know about government contracts, you might be wondering how these contracts could benefit your company, and how you can set about pursuing a potential contract opportunity. Recently Bill Murphy Jr., a contributor to Inc.com, explained how these contracts can be a viable way to tap into the federal spending budget and the contracts set aside for small businesses.
Why are government contracts potentially a good call for your business? The House Small Business Committee noted that federal law requires 23 percent of all contract dollars be awarded to small businesses. That means these contracts are no only open and available to your small business, but are set-aside specifically for companies like yours. Thousands of available contracts mean there are lots of opportunities.
How to win a government contract
Once you’ve decided to pursue a government contract, the next step is to know how to win against the other small businesses you’ll be competing with. According to Murphy, the fact that there are more than 25,000 contracts available is a double-edged sword. The sheer number or opportunities can feel overwhelming, so you need to determine which contract is right for you. This brings us to our first tip:
1. Understand your business
For starters, you must know your small business. Murphy stressed that a comprehensive understanding of your products, services and market will help narrow down the list of potential contracts. What do you have to offer? Use this answer to guide you forward.
2. Leverage what it is that makes your business unique
A large corporation has more resources, employees and customers. But, this doesn’t mean it is better for a government contract. As a small business, you offer other attributes that could make you more attractive. Maybe you have a special product bigger companies don’t have, maybe you’re better able to accommodate special needs that might be associated with a potential contract. You need to leverage these advantages to beat the competition. Murphy pointed out the number of contracts designed specifically for small-business segments, like women-owned, veteran-owned and underprivileged organizations—if you’re business fits into one of those categories, the government wants to do business with you.
3. Prepare for the paperwork
Winning a government contract is a paperwork-intensive process. With that said, you can have a better chance of success if you brace yourself for the work ahead. You’ll likely need to learn some new jargon to work with government procurement offices and realize the sheer volume of required paperwork is just part of the process. Murphy explained that scouring databases, filling out forms and networking with larger contractors is all part of locking down your next government contract.
Depending upon the service you provide or the products you sell, government contracts can be a profitable venture for almost every kind of business—from catering to manufacturing. Does it make sense for your business?
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