Key Takeaways

  • Successfully securing government contracts requires proper business registration, certifications, and an understanding of bidding processes.
  • Register with SAM and obtain a NAICS code, DUNS number (or UEI), and other relevant identifiers.
  • Certifications like SBA 8(a), HUBZone, Women-Owned, and Veteran-Owned Small Business can increase contract opportunities.
  • Learn the differences between contract types, such as competitive bidding, sole-source awards, and set-aside contracts.
  • Engage in government procurement platforms like FedBizOpps (SAM.gov), GSA Advantage, or state-specific systems like Team Georgia Marketplace.
  • Understand proposal writing best practices and pricing strategies to strengthen your bid.

Are you wondering how to apply for government contracts? Get all the required codes for your products and business (NAICS, DUNS, FEIN, etc.), register online with the System for Award Management (SAM), get your business on the government bidding list, and start bidding.

Government Contracting for Small Businesses

The small business sector is an integral part U.S. economy. Of the annual government spending of over 4 trillion dollars, almost $440 billion goes to small businesses.

Small businesses have a very large market. If you have the determination and patience to work within the ambit of set rules and regulations, pursuing government contracts for the supply of goods and services can be a lucrative business opportunity.

Since the application process for government contracts is quite lengthy and the government hardly ever moves at a high speed, you should plan out your businesses for the long haul.

Benefits of Government Contracting for Small Businesses

Government contracts can provide small businesses with a stable and lucrative source of revenue. Many agencies are required to allocate a certain percentage of contracts to small businesses each year, creating opportunities for companies that meet specific criteria. Benefits include:

  • Long-term contract stability
  • Access to large-scale projects
  • Opportunities for certified disadvantaged businesses (e.g., minority-owned, women-owned, veteran-owned)
  • Competitive advantage through small business set-aside programs
  • Potential for recurring work through contract renewals or extensions

How to Get Started for Government Contracts

North American Industry Classification System (NAICS) Code

Identify the NAICS code for the product or service you want to sell. You can find the codes on the official website of the North American Industry Classification Systems Association. These codes are based on the industry, country, and economic sector.

The NAICS code is an important factor the government looks at when determining the eligibility of a government contractor. Depending on the type of product or service you offer, you may have to choose more than one NAICS code.

DUNS Number

Apply for a free DUNS number from Dun & Bradstreet. It's a unique, nine-digit number that identifies the physical location of your business. Each business location is issued a separate DUNS number. The organization also conducts an Open Ratings Past Performance Evaluation for each DUNS number. This evaluation is comprised of an independent audit of your customer references. A rating is assigned after analyzing your performance data and responses to the survey.

System for Award Management (SAM)

Once you have your NAICS code and DUNS Number ready, register with the SAM website. It's the principal database of vendors maintained by the federal government. Under the Federal Acquisitions Regulation (FAR) system, you must be registered in SAM in order to be considered for a government contract or purchase agreement.

On registering with SAM, you will be given a Commercial and Government Entity (CAGE) code. Government agencies may ask for this code while responding to your solicitations.

Other Requirements

In addition to the above, you should also obtain the following in order to apply for a government contract:

  • A Federal Employer Identification Number or FEIN
  • Federal Supply Class (FSC) codes
  • Product and Service (PSC) codes
  • Standard Industrial Classification (SIC) code

Important Government Contract Certifications

Certifications can significantly improve your eligibility for certain government contracts. Key certifications include:

  • 8(a) Business Development Program: For socially and economically disadvantaged small businesses.
  • HUBZone Certification: For businesses operating in historically underutilized business zones.
  • Women-Owned Small Business (WOSB) and Economically Disadvantaged Women-Owned Small Business (EDWOSB): For women-led companies.
  • Service-Disabled Veteran-Owned Small Business (SDVOSB): For businesses owned by disabled veterans.
  • GSA Schedules (Multiple Award Schedules): Allows your business to sell to government agencies via pre-negotiated pricing and terms.

Obtaining the right certifications not only enhances eligibility but may also qualify your business for set-aside contracts that are exclusively available to certified companies.

The Process Involved in Government Contracts

In order to obtain a government contract, you must place bids and submit a proposal. However, before being able to submit a proposal, you must be registered in the bidding list or the government's list of vendors.

Understanding Types of Government Contracts

Federal and state agencies utilize several types of contracts based on the procurement method and scope of work. These include:

  • Fixed-Price Contracts: Payment remains constant regardless of incurred costs.
  • Cost-Reimbursement Contracts: Covers allowable expenses up to a set limit, plus an additional fee or incentive.
  • Time and Materials Contracts: Payment based on labor hours and material costs.
  • Indefinite Delivery/Indefinite Quantity (IDIQ) Contracts: Allows flexible ordering of supplies/services within a defined period.
  • Sole-Source Contracts: Awarded without competitive bidding, often used for unique qualifications or urgent needs.
  • Set-Aside Contracts: Reserved for small businesses or those with specific certifications (8(a), HUBZone, WOSB, SDVOSB).

Understanding these contract types helps businesses prepare more targeted proposals and manage contract expectations effectively.

Bidding List

  • All government agencies, including federal, state, and local, follow a certain bidding process. The bidding process must be fair and it must give bidding opportunity to all qualifying businesses.
  • Your business must qualify for the bidding process.
  • Contact the agency offering the government contract and request to be added to its bidding list or registered vendors.
  • You may be required to log on to a site and create your business profile.
  • Sometimes, especially at the local level, you just need to make a phone call or send a letter to add your business to the proposal list.

Business Qualifications

Government agencies often offer extra mileage to businesses with a special status, like veteran, minority, and women-owned businesses. In order to apply under one of these categories, you must have the required certification.

Bid Meeting

Once you are added to the government's bidders' list, the agency will send you an announcement whenever there is a contract opportunity. Sometimes you may be required to attend an initial meeting to discuss the proposal process.

Where to Find Government Contract Opportunities

To increase your chances of successfully bidding on contracts, regularly monitor the following procurement websites and systems:

  • SAM.gov: Central federal procurement platform for contract opportunities and RFPs.
  • GSA Advantage: Online government purchasing portal for GSA Schedule holders.
  • State and Local Procurement Portals: Such as Team Georgia Marketplace for Georgia contracts or California eProcure.
  • Dynamic Small Business Search (DSBS): A directory maintained by the SBA to connect small businesses with government buyers.
  • FedConnect.net: Provides opportunities for both federal and state contracts.
  • USAspending.gov: Useful for researching past contract awards and trends.

Setting up alerts and monitoring these platforms ensures that you stay informed of relevant opportunities.

Request for Proposal (RFP)

The contracting agency usually sends out a request for proposal outlining the bidding process and requirements, like insurance, pricing, qualifications, and the deadline for submitting a proposal.

Bid Review

Usually, a review panel goes through the submitted proposals and shortlists a few businesses for an oral interview.

Tips for Writing a Strong Government Proposal

A well-crafted proposal can set your business apart from competitors. Consider the following best practices:

  • Follow the RFP Instructions Exactly: Ensure all requested documents, forms, and certifications are included.
  • Highlight Your Unique Value Proposition: Clearly explain why your business is the best choice.
  • Provide Competitive Pricing: Offer fair and reasonable pricing without underbidding.
  • Include Past Performance References: Showcase successful project outcomes with government or private-sector clients.
  • Use Clear and Professional Language: Avoid jargon, and keep your proposal organized and easy to navigate.
  • Meet Deadlines: Late submissions are typically disqualified automatically.

Consulting with an attorney experienced in government contracting can help ensure compliance with proposal and contract requirements.

Contract Award

The government agency awards a contract based on the scoring and interview of the shortlisted contenders.

Frequently Asked Questions

  1. How do I know if my business is eligible for government contracts?
    Eligibility typically depends on your business size, certifications, and registration status with SAM.gov. Check the NAICS code size standards and SBA requirements.
  2. What is a set-aside contract?
    A set-aside contract is reserved exclusively for small businesses or those holding specific certifications, such as 8(a), HUBZone, WOSB, or SDVOSB.
  3. How do I find government contract opportunities?
    Opportunities are posted on platforms like SAM.gov, GSA Advantage, FedConnect, and state procurement sites. Setting up alerts can help you stay informed.
  4. Do I need certifications to bid on government contracts?
    While not always required, certifications like 8(a), HUBZone, WOSB, or SDVOSB can improve your chances, especially for set-aside contracts.
  5. What should I include in a government contract proposal?
    Include your business qualifications, certifications, pricing details, past performance, and a clear explanation of how you will meet the contract's requirements.

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