How to do Business with the Federal Government Jim Wasson, PhD, MBA Technology Business Consultant Small Business Development Center 6296 Rivers Avenue, Suite 302 North Charleston, SC Office:

Topics Covered Why Federal Government Contracting? Types of Government Contracts Small Business Certifications Getting Started as a Government Contractor Marketing to the Government Finding Procurement Opportunities Responding to Solicitations Winning Government Contracts

Why do Business with the Federal Government? U.S. Government is the world’s largest buyer of goods and services. Purchases total over $500 billion annually. Spent $115 billion with small business including subcontractors to prime contractors. Federal agencies are required to establish small business contracting goals.

Federal Contracting Goals 7% ($35 Billion) Small Businesses (SB) 5% ($25 Billion) Small Disadvantaged Businesses (SDB) including 8(a) 5% ($25 Billion) Women Owned Businesses 3% ($15 Billion) Service Disabled Veterans 3% ($15 Billion) HUB Zone Businesses

Types of Opportunities Government Business Qualified Small Business Qualified Large Business Qualified Small Business  Large Prime Contractors are required to establish subcontracting goals which match the government requirements in the RFP for: ◦ Small Disadvantaged Businesses ◦ Women Owned Businesses ◦ Service Disabled Veterans ◦ HUB Zone Businesses

Prime Contract or Subcontract? How long have you been in business? –Less than 2 years experience more suitable for subcontracting opportunities. –2 years experience are more suited for subcontracting opportunities or prime contracts under $100,000 –Many years experience in the commercial industry and/or experience with local, state, or federal government are more suited for prime contracts over $100,000

Types of Solicitations Request for Information (RFI) –Sources sought. Precursor to solicitation. Ask about real need. Request for Proposal (RFP) –30-90 days to respond. 270 days to award. B&P = 4 x $100/hr. = $65,000 Request for Quote (RFQ) –Already prequalified on existing contract vehicle, such as IDIQ. Simplified Acquisition –Typically commodity items. Less than $150,000. Three quick quotes. Sole Source Negotiated – No proposal needed –Government Services Administration (GSA) Schedule Contract. –Minimum annual sales of $25,000 during first two years. Unsolicited Proposals (White Papers) –Blind bidding 5% Pwin. 80% awards go to incumbents. Only bid if asked.

Bid/No-Bid Decision Who do we know at the customer’s site? Decision makers? Did we discuss requirements with the customer? Pain points? Is the customer receptive to us and our proposed ideas? Do we have an idea of an acceptable amount to bid? Who helped the customer develop the statement of work? Who is the incumbent? Who else will be bidding on this? Is the team in place (including subs) to write the proposal? What is our “win theme” to highlight our discriminators? Once the solicitation hits the street they go into blackout mode. Only clarifying questions in writing will be answered by the Contracting Officer and all answers will be shared will all potential bidders.

Types of Contracts Full and Open Competition –Any company, large or small, with the right NAICS code and qualifications can compete. SBs are often subcontractors. Small Business Set-Aside (SBSA) –Only Small Businesses who meet the specific Request for Proposal (RFP) requirements may compete. Indefinite Delivery/Indefinite Quantity (IDIQ) –Indefinite delivery and quantity of services usually on individual task orders (TOs) over a fixed time. Only the winners on the IDIQ may compete on Task Orders (TOs). IDIQs can be full and open and have a separate solicitation for SBSA.

What is a Small Business for Federal Contracts? For Profit Located and Operated in the US –US Payment of Taxes –Use American products, material, labor Independently Owned –Sole Proprietorship, Partnership, Limited Liability Company, or Corporation Size - North American Industry Classification

Before we get started Do You have the appropriate business license and other certifications required to do business? Are you current in your taxes? Are you financially capable of sustaining your business for 30 to 60 days while payment is being processed? Can you accept credit card/debit cards for payment?

Certifications Required Self Certification – Done by the company through System for Award Management (SAM) –Small Business –Woman Owned Small Business –Service Disabled Veteran Owned Small Business SBA Certification – Required for the 8(a) Small Disadvantaged Business Assistance program. The SBA verifies self certifications & HUB zones. www/sba.gov/hubzone

Ten Basic Steps 1.Identify your DUNS number 2.Identify your EIN with the IRS 3.Identify your NAICS code ( ( 4.Register with SAM ( 5.Register with DSBS ( 6.Make sure your business is financially sound 7.Search FedBizOpps for opportunities & subscribe 8.Know the rules ( 9.Market your business. Go to tradeshows. Network 10.Respond to solicitations with winning proposals

Data Universal Numbering System (DUNS) Dun & Bradstreet is a publicly traded company that maintains financial credibility information. It serves a worldwide market of more than 100 million companies, each of which is listed in the company's directory with its own DUNS number. Companies seeking Government contracts are not considered until they obtain a DUNS number. You can request a DUNS number for free by visiting

Employer Identification Number (EIN) Your entity’s Tax Identification Number (TIN) is assigned by the Internal Revenue Service. Sole proprietors may use their Social Security Number if they do not have a EIN, but it will not be treated under the privacy data act in SAM To obtain an EIN: employed/apply-for-an-Employer- Identification- Number-(EIN)-online

System for Award Management (SAM) SAM is a central location where companies can submit their business information if they want to do business with the Federal Government. The information is added to a vendor database of government contractors. For convenience, when you complete your SAM registration there is a link to add additional data into the SBA Dynamic Small Business Search site.

What you need to register in SAM –DUNS Number –IRS Employer Identification Number –3 years average of gross receipts (revenues/sales) –Number of employees (full-time equivalents) –Bank routing number and account number –Applicable NAICS codes (North American Industrial Classification System) ( / /

Dynamic Small Business Search (DSBS) Search tool that accesses information data from SAM for firms that the SBA considers small along with additional data provided by the firms and any SBA certifications. Used by small businesses to increase their visibility to government and business procurement offices searching for small businesses to meet their SB contracting goals.

Marketing to the Government Do you have marketing materials? –Business Cards –Handouts (flyers/brochures) –Website –Full presentation (Powerpoint) –5 minute elevator speech Are you working your network?

Search for Federal Contracting Opportunities

Typical Request for Proposal (RFP) Section A – Solicitation/Contract Form Section B – List of supplies & services Section C – Statement of Work (SOW) Section D – Packaging requirements Section E – Inspection and acceptance Section F – Delivery and performance Section H – Special provisions Section I – Contract clauses Section J – List of attachments Section K – Representations & certifications Section L – Proposal instructions Section M – Evaluation factors for award

Typical Proposal Outline Cover Letter Technical and Management Proposal (page limited) - Problem Statement (problem you are trying to solve) - Technical Approach (proposed solution to the problem) - Statement of Work (specifically what you are contracting to do) - Program Schedule with Deliverables (under the contract) - Qualifications and Capabilities - Past Performance (related contracts) Cost and Price Proposal - Direct Labor Hours and Cost (broken down by WBS contained in SOW) - Indirect Labor Cost, Materials, Subcontracts, Other Direct Costs, Fee, etc. Model Contract - Terms & Conditions, Certifications and Representations

Writing a Winning Proposal Understand the solicitation and respond appropriately Demonstrate how your firm can best fulfill the government’s needs Offer a price (cost + fee) that is fair and competitive Making sure your proposal is well-written and error free Show evidence of success through past performance Interweave an amazing story throughout all parts of the proposal that makes a compelling case for your firm as the best value solution

What to Avoid Failure to fully understand the solicitation and governing regulations Incomplete or late submission Proposal is not specific and to the point High on fluff and weak on substance Failure to understand best value or lowest price technically acceptable considerations Unrealistic proposal pricing Evaluation components are not sufficiently addressed in the proposal Errors in the submission

Contract Pricing Contract pricing is an important aspect of procurement and an important component in developing a strategy to win federal contracts. Contracting Officers are responsible for ensuring that agencies purchase supplies and services from responsible sources at fair and reasonable prices. Company is responsible for developing a contract pricing strategy that is reasonable, competitive, but profitable.

Defense Department Procurement Resources  Government Contracting: The Basics Government Contracting: The Basics  Department of Defense Subcontracting: The Basics Department of Defense Subcontracting: The Basics  Marketing to the Department of Defense: The Basics Marketing to the Department of Defense: The Basics  Guide to Marketing your Business to DoD Guide to Marketing your Business to DoD  Subcontracting Opportunities with DoD Major Prime Contractors Subcontracting Opportunities with DoD Major Prime Contractors Defense Federal Acquisition Regulations

Other Resources Small Business Innovation Research (SBIR) Grants SBA Contracting Resources center/training/government-contracting SUB-Net – a place where prime contractors post solicitations For state and local opportunities go to:

SBDC provides free and confidential assistance SAM registration assistance NAICS code assistance 8(a) application assistance Hub Zone application assistance Solicitation review Bid preparation Business planning Marketing

Jim Wasson, PhD, MBA Technology Business Consultant Small Business Development Center 6296 Rivers Avenue, Suite 302 North Charleston, SC Office: