Every time you turn on the television or pick up a newspaper you hear it: the economy is in bad shape, and people are afraid to spend money. That fear can be seen not just in retail and consumer spending, but in business and manufacturing as well.
But there is one potential client out there who does have money to spend. That’s the government, says Michelle Hermelee, a specialist in assisting businesses obtain contracts with local, state and federal government who operates BH Sky Associates at 100 Overlook Drive. “The government is the largest purchaser of goods and services in the country,” says Hermelee. “Local, state and federal government spending combined equals about $800 billion per year. Why would any business want to ignore such a lucrative market?”
Hermelee did not expect to open her own consulting business, particularly in the area of government contract assistance. Her original interest was in public health, and she received her bachelor’s from Rutgers in that field in 1999. She originally worked in the health industry, where her job involved working to develop government contracts. After seven years of experience with them, she opened her own firm in 2006 so that she could use her expertise to “help more small businesses identify, secure, negotiate, manage, and market contracts with the government,” she says.
Obtaining a contract with the government is not just for large corporations. Small businesses also have an excellent opportunity to obtain contracts. In fact, she says, nearly a quarter of the fed’s contracts are awarded to small business each year. Businesses that are classified as “economically or socially disadvantaged,” including businesses owned by disabled veterans or women, or companies located in a Historically Underutilized Business, or HUB, zone, have an edge in obtaining contracts from the federal government.
Doing business every day. One of the best reasons to consider doing business with the government is that it never slows down. “No matter what else is happening in the rest of the economy, the government is writing purchase orders every day,” Hermelee says. A government contract can also bring stability to a small business because it is usually a long-term contract (at least a year), rather than a one-time order.
“Let’s say you own an HVAC repair company,” Hemerlee says. “Instead of waiting around for one client to need your services, by working with the government you could have a contract to handle maintenance and repairs on a building, or several buildings, for an entire year.”
The government needs everything that other business needs — basic office supplies, food services, cleaning and maintenance. It also contracts for more specialized services such as surveying and has a few growth areas to take advantage of — biometrics, cyber security, healthcare, logistics, and energy efficient and “green” products.
Getting registered. Before even looking for a government contract, the first step for a business owner is to obtain a nine-digit identification number, or Duns Number, from Dun and Bradstreet. Registration is free and is available at www.dnb.com.
Next the business must register with Central Contractor Registration, the primary supplier database for the federal government, at www.ccr.gov. The CCR is a central database that collects information from suppliers, validates and stores the data, and distributes it to government agencies. A business must have a Duns Number before registering with the CCR.
When registering with the CCR a business must choose which NAICS classification codes it should be listed under. “It is important to choose the most correct codes for your business because this is how the government agencies will find you,” says Hermelee. She advises to choose as many classifications as possible and keep them as broad as possible. Finally, the business must file an ORCA, or Online Representations and Certifications Application, at www.orca.bpn.gov.
Hermelee recommends business also obtain other appropriate certifications, such as small business, or woman-owned business, to “leverage” these classifications whenever possible. “Look at all of the programs out there to see what fits your business,” she says. Information on a variety of programs, as well as all of the government registration sites listed is available on at www.bhskyassociates.com.
Finding contracts. Once you have completed the registration process you can begin the search for appropriate contracts for your business. The web has made it easier for businesses to shop for contract information, says Hermelee.
The first stop to make is Federal Biz Opps, or www.fbo.gov, which bills itself as “the U.S. government’s one stop virtual marketplace.” The site allows commercial vendors and government buyers to “post, search, monitor, and retrieve opportunities solicited by the entire federal government community.” Every federal agency is required to post bids over $25,000 on this site.
Businesses looking for contracts can search the site by NAICS code, keyword, or look up their competitors to see what other similar business are bidding on. The site also lists additional important information such as the procurement officer for a bid.
For businesses unwilling to jump into the government contract arena, Hermelee suggests getting initial experience as a sub-contractor. Many larger corporations are interested in sub-contracting to smaller companies because the latter’s certifications can help the large company leverage those small business set-asides, says Hermelee.
Remember to breathe. It is important for anyone interested in bidding on a government contract to be patient. “This is not a fast process, Hemerlee says. “It takes time to obtain the certifications and make the connections.”
She suggests attending vendor outreach programs to make the right connections. Business owners should also do their homework before making any bids, she adds. “Just like with any other type of contract you need to do your market research, find out where and when the bids will be posted, learn about your competition and take a good look at your pricing. Make sure you have a very accurate idea of how much money you need to make a profit on the contract.”