How to Get Government Contracts for Small Businesses

Is your small business trying to expand its range of government contracts and increase government sales revenue? You likely already know that U.S. and Canadian federal, state, provincial, territorial and local governments spend billions of dollars each year on government contracts, but it can be challenging to get started.

This guide will explain how to get government contracts for your small business so that you can expand your government sales opportunities to help your company grow.

Different government entities will release bids or RFPs for private companies to provide them with goods and services. Often, these small business government contracts are released through a competitive process, and they have designations that some or all of the work must be performed by a small business.

If you are a small business just starting to sell to the government, this helpful guide shares some of the basics that your firm needs to know.

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It is important for your firm to determine which socioeconomic categories your business falls under. These categories can give you a significant government contracting advantage. Government entities are often required to set aside part or all of a contract for one or more of these categories of business. These are commonly referred to as small business set-aside contracts. Here are four common types:

1. Women-Owned Small Business Federal Contracting. The government aims to award at least 5% of federal contracting dollars to women-owned small businesses (WOSB) every year.
2. Service-Disabled Veteran-Owned Small Business. The government aims to award at least 3% of federal contracting dollars to SDVOSB firms every year.
3. 8(a) Business Development. The government aims to award at least 5% of federal contracting dollars to qualified small disadvantaged businesses every year through the 8(a) program.
4. HUBZone. The government aims to award at least 3% of federal contracting dollars to HUBZone-certified small businesses every year. A HUBZone is a historically underutilized business zone where the government is looking to foster economic activity such as job creation. Of the small business programs, it is the only program not focused on the ownership of the business, but rather on the location of the business and its employees.

These programs aid small businesses by providing access to many sole-source, noncompetitive government contracts.

Firms that are qualified under multiple socioeconomic categories can increase their status and potential of being awarded a government contract, especially if the buying agency is struggling to meet its socioeconomic contracting goals.

Veteran contractors know that successful businesses don’t just follow the request for proposal (RFP) process to win business. Here are three paths you can follow to find government contracts that might fit your small business:

1. Future leads in spending plans and budgets: Savvy small businesses know that that they can gain a competitive edge by gathering information on potential upcoming projects and opportunities contained within published agency budgets and capital spending plans. Governmental entities publish this kind of information well in advance of a bid ‘hitting the street’ as part of their strategic planning and budgeting process. Agencies also often offer a preview of coming solicitations by hosting industry days. This kind of ‘prebid’ information can provide small businesses with forward-looking visibility to inform pipeline development months, even years, in advance of the publication of an opportunity.
2. Currently open bids and RFPs: Bids, Requests for Proposals (RFPs) and other common competitive solicitation types are the bread and butter of government contracting. However, small businesses should be wary of looking at only currently open solicitations as established players and your competitors are often aware of these solicitations well before the opportunity is published. The key to increasing your ability to compete on a government contracting opportunity is to gather information, analysis and intelligence in advance to help inform you on its requirements and help you reach a bid/no-bid decision early in the process.
3. Post-contract award information: In order to operationalize a truly scaled business development approach to your government contracting sales channel, information gathering should continue after the contract is awarded, whether you won the contract or not. Small businesses who make post-award information gathering a priority stand to benefit with invaluable intel such as where your competitors are winning and with whom, when recurring contracts are coming up for re-compete opportunities, and what pricing has been offered by your competition during previous bid cycles.

Small businesses are often able to establish past performance as a way to break into government contracting by first seeking out subcontracting partnerships and teaming agreements, serving as a member of a prime contractor’s team. By teaming with a prime, your firm can establish valuable contracting experience while avoiding having to navigate the complex compliance requirements and challenges alone.

Many contracts specify that small businesses must perform a certain amount of the work, which creates a need for larger businesses to partner with smaller ones to gain access to these contracts. These agreements allow smaller contractors to maintain their status as a small business, or other types of socioeconomic categorization.

Smart small businesses know that they can’t simply register on a government website and begin to win small business government contracts immediately. Companies in all industries can get ahead in their capture planning by using business development solutions that are specifically designed to help them create a powerful proposal, win a government contract bid and expand their public sector sales pipeline.

Tools like GovWin IQ can provide your team with the most up-to-date information on the government market, along with expert research support and a full suite of powerful tools. GovWin IQ is the industry-leading platform for government contractors that provides small business with early awareness of new opportunities, deep planning intelligence, potential teaming partnerships, and the strategic insight that businesses need to get ahead of the competition.

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