WHY YOU SHOULD PURSUE GOVERNMENT CONTRACTS
I know you’ve heard people say that government contracts are a pain and that they’re nothing but a headache. I’m here to tell you that’s not true! Government contracts can be an amazing opportunity for your small business, if you do the right things and accept the caveats of doing business with Uncle Sam. In this post, we’ll look at why getting into government work is worthwhile, what hurdles stand between you and success with federal contracts, and how to overcome them by finding common ground with your potential customers in agencies like NASA or Homeland Security.
There are federal programs to help your small business.
The government is one of the biggest spenders in the world. With so much money at its disposal, it’s imperative to understand how you can make sure your small business gets a piece of that pie.
But getting started can be tricky if you don’t know where to look for help. The good news is that there are many programs out there specifically designed for small businesses like yours—and some of them are even free!
Government contracts can lead to long-term revenue streams.
If you’re looking for ways to build a business that will last, government contracts can be a great way to go. Government customers are typically not as sensitive to the ups and downs of the economy. They have a long-term funding plan and are willing to pay more for products that meet their needs.
Being able to supply products or services that your government customer needs is also an important element in building trust with them. This can help you build up your reputation as a reliable supplier, which can lead to other opportunities down the road if your company gets into trouble or goes out of business at some point in time (which happens even with companies with excellent reputations).
You can access government initiatives designed to help women and minorities.
If you’re a woman or minority business owner, you can get access to government initiatives designed to help women and minorities. For example:
- Women-owned small businesses (WOSBs) are required to meet the same eligibility requirements as SBs and MBEs but receive greater consideration for federal contracts reserved for WOSBs.
- Minority-owned small businesses (MBSs) are required to meet the same eligibility requirements as SBs and MBES but receive greater consideration for federal contracts reserved for MBSs.
- Small disadvantaged businesses qualify if they have no more than 100 employees and $7 million in sales/receivables in the previous fiscal year, or if they have no more than 500 employees and $14 million in sales/receivables in the previous fiscal year.; however, an SDB is not subject to any minimum capitalization requirement., whereas a small business concern must be capitalized at least at one-third of its size(based on revenues), so this means that an SDB could potentially be capitalized with less than 1% equity while a SME would need 3% equity., Whereas an SBA 8A set aside contract requires $15 million total annual prime contract awards within one year prior to award date; however, there is no such requirement under Section 15.(5)(a)(3)(A)(i).
The government is a potential partner in helping build your small business.
The government is a potential partner in helping build your small business. In fact, some of the most successful businesses in our country today have been built with help from the government. For example, Google got its start when it was funded by the National Science Foundation to digitize books at Stanford University.
It’s not just startups that benefit from working with the government; established companies can also benefit. A recent study found that 54 percent of private sector firms received support from a public agency during 2008-2014 (as noted on Forbes). If you’re thinking about entering one of these industries, here are five reasons why you should pursue government contracts:
- You’ll have access to funding opportunities that aren’t available elsewhere
- You’ll be able to diversify your customer base and reach new markets
- Your business will appear more credible among potential clients who may be unfamiliar with what it does
- You’ll get valuable training and networking opportunities within your industry or field as well as throughout other sectors
Being part of the federal government’s supply chain can improve your business’ reputation with other customers.
You’ll build a reputation for quality and reliability.
After all, you’re a supplier to the federal government—the U.S. Department of Defense is your biggest customer, serving as the world’s largest purchaser of goods and services. Being part of this supply chain can improve your business’ reputation with other customers by showing them that you’re committed to getting things done on time and under budget.
You’ll also be seen as innovative.
The federal government is always looking for new ways to do its job better, faster and more economically—and it needs suppliers who are willing to help with those efforts. That’s why agencies like NASA will work with companies like SpaceX (which manufactures rockets) or GE Aviation (which makes engines). It’s these kinds of partnerships that make commercial spaceflight possible today, so imagine what kind of innovation could come from working with federal agencies!
There are many ways to sell to the government.
There are a number of ways to sell to the government. You can approach it directly, by selling your product directly to the government agency that needs it. But this can be difficult if you’re not well known within that agency or if there are no open bids for your product at the moment.
Another option is indirect sales, which means selling your product through one or more middlemen (i.e., distributors). This often allows for greater flexibility in pricing and delivery times but requires more resources and time from both parties involved in order for them to get paid on time so they won’t default on their end of the bargain by going out of business during this process if they don’t receive timely payments from other companies who have already secured $50 million worth of orders from those same clients before proceeding with theirs; thus causing all three parties mentioned above (plus possibly even four others) depending how many contracts were signed beforehand with each individual customer needing certain items quickly shipped over seas before any delays occur due lack supply chain logistics support systems.”
While there are hurdles, you can use government contracts as a chance to grow your small business and a way to give back.
Government contracts offer an opportunity to grow your small business. When you work with the government, you have access to a huge pool of potential customers that are used to paying high prices for quality products and services. These customers can help you build up your infrastructure and increase your profits by virtue of their demand for what you have to offer.
Government contracts also give back in another way—they provide an avenue for small businesses to support social causes and missions important to them (like supporting women-owned businesses). Government initiatives such as Women-Owned Small Business Program (WOSB) or Historically Underutilized Businesses (HUB’s) exist so that women and minority-owned companies can access lucrative opportunities in the marketplace.
The federal government is a huge, complex organization that can seem daunting to work with. But it’s also an opportunity for small businesses who want to break into the marketplace and make a name for themselves. The good news is that there are many ways in which you can sell your products or services to the government—and if you’re willing to do some research and put in some hard work, then there’s no reason why your idea won’t succeed!