Small business advice: How to break into the government contracting arena


For small business owners, getting your foot in Uncle Sam’s door can be challenging. But once you do, the rewards are well worth it, Karch says. (JIM LO SCALZO/EPA)
November 22, 2013

Sure, we have all seen the stories from the media regarding a government shutdown, sequestration and amazing amount s of government debt. But putting the doom and gloom aside, one must realize that the federal government represents, for all intents and purposes, Fortune 1 in the marketplace.

Having spent more than 25 years in and around this space, I have gained not only a great appreciation for the value of government contracting but a deep understanding of what it takes for small firms to succeed.

Small companies are the lifeblood of government contracting. Whether in construction, technology, healthcare or any other sector, government buys and buys often.

Small business owners need not shy away. Quite the contrary, they should flock to the government as the opportunity for business growth exists — but as they flock, there are a number of elements small business owners must address.

Here are some of the most important ones.

Patience

It is sometimes difficult for small businesses to be patient when it comes to revenue generation. In the government contracting arena, though, patience is more than just a virtue — it’s an absolute must.

Be patient but diligent in modifying your company offerings so they fit government needs. With technology products or services, think about security; with construction, think about scale; and with healthcare, think about the long-term process.

Of course, these modifications to your offerings can take time, but adding security to your technology is a good thing for all of your clients. Adding additional labor to your construction business will accelerate growth. And learning the nuances of HIPAA will pay off in your commercial healthcare business.

Commitment

Government contracting requires a commitment of capital and spirit for a small business. The capital does not need to be an exorbitant number, mind you, just a committed amount. Establishing accounting systems modifications, adding proposal development expertise and adding government contracting delivery expertise cost money.

The reward is usually much greater than the expense, but the return on the initial investment is usually measured in quarters and years, not weeks and months.

Securing expertise

Like any new industry to a small (or even a large) business, securing the right expertise is paramount for success. Too often, small business owners look inside and try to restructure finance, sales, marketing and delivery personnel into a model they think will succeed in government contracting.

Government contracting is filled with nuances, acronyms, procedures and regulations that require expertise. This expertise is not only evidenced by the need for a Rolodex in the sales and business development disciplines but also in familiarity with things like opportunity capture, proposal management, DCAA certified financials and more.

No real “greenfields”

Small business owners are by nature entrepreneurs and innovators. On the other hand, the government, by its nature, exists to support the people and is not measured by its innovative breakthroughs — or lack thereof.

Small business owners entering the government market should customize their offerings to benefit government initiatives and realize that government operations, product purchasing and day-to-day initiatives do not offer many greenfields for new “stuff.” Sure the occasional new technology may create a wave, but for the most part, government contracting is about giving the government what it wants, needs and can afford when it wants it. If an agency likes your offering and you deliver it in a cost-effective manner, regardless of whether it’s the newest thing, you have a great shot at success.

As a small business owner, look to set aside a year to break into this new business, utilize experienced experts, whether as employees or contractors, and sell what you know how to sell. If you are in the technology space, create a niche. If you are in construction, create a unique value proposition. Or, if you are in a healthcare field, create a unique benefit to the overall wellness of the end user.

Small businesses and the federal government are a natural fit. Yes, there are many pitfalls and areas of concern, but the prospect of a five-year, guaranteed contract can be a game-changing opportunity for a small firm.

Paul Karch is the president of SelltoGovernment.com, a Gardant Global initiative.

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