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Federal Contracting
The U.S. government is the largest buyer of goods and services in the world.
In FY2005, the government spent $376,463,953,870.
This equates to over $1,031,408,092 dollars spent every day ~ or $42,975,337 dollars every hour!
Selling to the federal government may be a good business decision for your business.
However, there are many players and going after federal contracts is very competitive. Prepare your business for success. Learn more about the government hierarchy, what the government buys, how acquisitions are made and familiarize yourself with procurement regulations.
Research Phase
Who is who? Familiarize yourself with the federal government organization structure. There are hundreds of federal agencies, with each agency having many offices, and each office may have multiple locations. Research the complete Federal Agencies Directory.
What federal agencies buy my product/service? We encourage you to identify what federal agencies are most likely to buy your product/service. You can begin this search by visiting FedBizOpps . FedBizOpps is the web portal
to access information regarding federal procurement opportunities over $25,000. Create a list of keywords that most accurately depicts your business. Conduct keyword searches under "Find Business Opportunities" to view active opportunities. This exercise will show you the potential size of your business' market and what agencies you should target. Once you have identified the agencies that you wish to pursue, locate that specific agency's website and read their strategic plan, proposed budget details, note their their small business officer's contact information, and study their "how to do business" page.
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Who is ready to buy? Many federal agencies compile and make available projections of contracting opportunities. Many agencies will refer to these projection publications as forecasts. To learn more about the types of products and services an agency may be buying in the near future, it is a good idea to research the forecasts. Note; not all agencies publish forecasts. |
Is my timing right? The federal government's fiscal year is October - September. More contracts are issued at the end of the fiscal year - July through September.
 What is the role of the internet? In an effort to streamline federal procurement processes, the government is moving toward a "paperless" atmosphere and is expanding the use of E-Commerce (General Services Administration and increased credit card use). There is an increased demand for products and services, but there are less procurement staff. The government wants to procure as easily as possible.
Become " computer savvy". Not only will you be required to register in various online databases, bidding opportunities are posted online or sent via email, and contract payments are made electronically.
What are the rules? The Federal Acquisition Regulations, or FAR, governs almost all federal purchases in order to establish uniform policies and procedures for acquisition by all executive agencies. The FAR outlines both your company's rights and the government's rights. When reading a solicitation, you will find specific FAR clauses that you will be required to abide by if responding to that solicitation.
Two sites for obtaining FAR clause information are ARNet and FARSite.
In addition to FAR regulations, each agency may have their own internal agency purchasing regulations.
Business Identification Phase
How does the government view
my business?
Identify:
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Small business |
vs. |
Large business |
The definition of what constitutes a small business varies from industry to industry.
The general criteria used to determine business size is:
- # of employees for non-service businesses
- annual revenue for service businesses
(average of the last 3 years receipts)
Visit the Small Business Administration website to determine your business size.
How do I inform the government about my industry?
A NAICS code (North American Industrial Classification Code) is a numeric code which corresponds to a business industry. This system was developed to organize business categories on a production/process-oriented basis and is used for governmental regulations and census reports.
Visit the U.S. Census Bureau to determine your NAICS.
SIC code - (Standard Industrial Classification) The SIC system was replaced with the NAICS system in 1997. Although the SIC system is outdated, SIC codes do still appear occasionally on solicitations.
How do I inform the government about the products or services my business offers?
If your business offers a product - identify your FSC code:
A FSC (Federal Supply Code/Class) is a numeric
code that identifies supplies, products and commodities that the government procures. Visit the DRMS website to determine your FSC.
If your business offers a service - identify your PSC code:
A PSC (Product Service Code/Class) is an alphanumeric code that
describes services that the government procures. Visit the Softshare website to determine your PSC.
Does my business qualify for any special business classifications?
There are five small business affirmative action classification programs managed by SBA:
Woman-owned (WOSB) business is defined as 51% owned and controlled by a woman/women.
Small Disadvantaged Business (SDB and 8a) is defined as 51% owned and controlled by a socially and economically disadvantaged individual(s).
Veteran-owned business is defined as 51% owned and controlled by one or more veterans.
Service-Disabled Veteran-owned (SDV) business is defined as 51% owned and controlled by one or more service-disabled veterans.
HUBZone business is a "historically underutilized business zone".
Why is knowing my business classification important?
Goaling requirements
Federal agencies and prime contractors are congressionally mandated to meet affirmative action goals. These goals are negotiated individually with the SBA with a minimum percentage established.
Set asides
Your business may be eligible to receive federal government contracts that are specifically designated, or set aside, for a certain business classification.
CCR registration
Determining your business classification is necessary to complete the mandatory CCR registration.
Marketing tool
Marketing your business to the government is just as important as your existing marketing efforts in the commercial world. If you can determine that your business is unique in some way - market it!
Database Registration Phase
What databases should I register in?
Dun & Bradstreet Number (DUNS) - The first step toward establishing an information file about your business is by obtaining a Dun & Bradstreet DUNS number. Your company will need a DUNS number if you plan to do business with the federal government. The DUNS number is easy to obtain by calling (866) 705-5711.
Taxpayer Identification Number (TIN) - A TIN
is used to identify the tax accounts of businesses, and must be furnished on business returns, statements, and other tax related documents. Obtain a TIN by calling the IRS at (800) 829-1040
to request form SS-4
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Central Contractor Registration (CCR) -
The purpose of Central Contractor Registration (CCR) is to have commercial companies registered as a "trading partner" with the Department of Defense. Both current and potential government vendors are required to register in CCR in order to be awarded contracts by the government. Registration is accepted online at the CCR website.
Helpful tips for completing the CCR application:
Gather your business information such as business start date, number of employees, annual revenue, incorporation dates, point of contacts and your DUNS number. Gather your business banking information such as your account number, ABA routing number, ACH contact and banking/EFT information. Contact your bank directly if you need assistance.
The company's legal business name you enter on your CCR registration MUST exactly match the company name in your DUNS registration.
CAGE code - (Commercial and Government Entity code) is not a manadtory field, it will automatically be assigned upon successful completion of your CCR registration.
BPAC recommends printing this form to use as a worksheet prior to online data entry.
Using your completed worksheet as a guide, go to www.ccr.gov and choose "Start new registration".
Do not discard the temporary confirmation number assigned at the start of your online registration.
After successful online submission of your application:
After successful submission of your online application you will receive a welcome notice from CCR - this may take 4-7 business days. The welcome notice will provide instructions for completing the final step in the registration process, which is retrieving your confidential TPIN (Trading Partner Identification Number).
It is very important that you save your assigned TPIN number and keep it secure.
On an annual basis, you will be required to update your CCR registration using your DUNS and your TPIN in order to keep your registration active.
Nonactive registrations may be deleted from the system.
If you have any questions about your registration, contact CCR directly at (888) 227-2423. Or you may contact our Center for assistance at (608) 243-4490.
Locate Federal Contracting Opportunities Phase
Methods of finding federal opportunities can be varied, based on which agency or agencies, that you've identified as your target market in the "Research Phase" above.
BPAC's recommendations for finding federal contracting opportunities include:
Search the Internet
Government buyers publicize their business opportunities by posting information directly to FedBizOpps. The FedBizOpps site is the single government point-of-entry for federal government procurement opportunities over $25,000.
Bidmatch Program
Our Center offers a bidmatching service to Wisconsin businesses interested in receiving email notifications of federal contracting opportunities (this service also includes state and local opportunities).
Contact our center if you would like to know more about this service.
Prepare and Submit Your Proposal
The first question you might ask yourself after finding a bidding opportunity is "Should I respond?"
The government seeks the "best value" products and services, "fair and reasonable" prices, and on-time delivery.
You will need to determine if you can be a responsive bidder - read the solicitation carefully!!
Can your business realistically compete?
If you have determined that responding to a solicitation is a good business decision, the next step is to prepare your response. Our Center offers one-on one business counseling to help guide you through a systematic approach to submit a compliant and responsive proposal. To schedule an appointment, please call our office at (608) 243-4490. Our government contract specialists are happy to assist you!
Federal Level Contracting | State Level Contracting | Local & Municipal Contracting | Subcontracting
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