If you’re a small business owner looking into government contracting, you’ve probably seen the well-meaning advice: Just go to SAM.gov and search for contracts. If you find one that seems like a fit, bid on it. If you’re the best applicant, you’ll land the contract.
Not so fast.
When Lauren Weiner speaks with business owners who want her advice, she tells them the truth. “There’s so much more that comes into it,” Weiner says. “You just being able to perform the service is not good enough.”
Weiner and her business partner, Donna Huneycutt, landed their first contract in 2006. Today, their firm, WWC Global, was recently awarded the largest contract to a woman-owned business in the history of the U.S. Special Operations Command.
Their backgrounds – their knowledge as military spouses and Weiner’s experience working for the government as a civilian – helped them get started. They still had to learn the challenging game of government contracting.
For business strategist Chandra Hunt, the path was similar: she had been a federal employee working on contracts on the government side. Then she began working for a Fortune 500 company that served as a government contractor. Eventually, she began consulting for smaller companies that want to enter this complicated but potentially lucrative market.
Weiner and Hunt, along with Antonio Doss, deputy associate administrator for government contracting and business development at the SBA, were recently asked : What do small business owners really need to know?
Choose your niche.
People often think it’s wise to pursue contracts with a slew of government agencies and departments.
“They’re trying to market themselves to one of the big DOD agencies.,” Doss said. “They’re trying to market themselves to NASA, to Health and Human Services, to the Social Security administration. They’re much better off to say, ‘OK, I’m going to do some research. I’m going to figure out who’s buying what I want to sell, and let me focus on that one particular agency.’”
Hunt agreed. Just as you would in the commercial business world, “you need to identify your target market, she said. “And then laser-focus on that instead of trying to paint a broad stroke.”
Relationships are everything, Weiner said, but it’s not that just knowing someone gets you the contract. Getting to know people means discovering exactly what they need and how your company can help.
“The ‘knowing someone’ drives the ‘knowing something,’” she said, “and that drives performance.”
So reach out and try to connect with people face to face (or at least face-to-Zoom). This is part of why choosing a specific target market matters: It helps you determine exactly who you want to get to know.
“Get connected with some of the buying activity personnel through the Office of Small and Disadvantaged Business Utilization,” according to Doss. All federal agencies have that particular office, and often it will offer online programming. “It’s a really great way to get people acclimated into some of the offerings that exist in the federal space.”
Learn the language (and ask if things get lost in translation).
“Government contracting is a little bit antiquated,” Hunt said. “If you’re looking for a commercial proposal, they’ll say, ‘Hey, we need you to do this and this,’ But in government-speak, it’s more like, ‘Thou shalt do this in accordance with the F.A.R. 5.206 and in accordance with the chapter paragraphs A, B and C.’ And you’re like, ‘What? What was that?’”
People who have served in the military or worked for the federal government may have a slightly easier time navigating language. But it varies even across departments, so everyone needs to build in time for learning. In short: If you’re not sure exactly what particular language means, ask someone who knows.
Make sure you can handle the wait.
The turnaround time for winning a contract can be dramatically longer than you’d find in the civilian business world, and it can be “dramatically more involved than a B-to-B or B-to-C sales cycle,” Weiner says. “They’re serving multiple different agendas … they’re not just trying to quickly buy the right thing.”
And even when the process moves relatively quickly, small businesses have to remember that – unlike a commercial contact – they won’t be paid immediately upon signing.
“With government contracts, they pay you in what’s called a net term,” which could be anywhere from 30 to 60 days later, according to Hunt. So don’t dive in unless you can wait for that payment. (On the bright side, the government generally does pay you on time once that due date finally arrives.)
Don’t underbid – no matter what people tell you.
“One of the pitfalls that some folks run into when they first start out is thinking that they have to lose money on their first contract,” Hunt said.
But you don’t have to bid at a loss in order to be competitive or to land your first contract.
“The government put together the Small Business government contracting system to help uplift small businesses,” she said. “You can offer the lowest cost, highest value to the government without losing your shirt.”