How to Get Government Contracts

Introduction

Government contracts can come to you in one of two ways: either directly with a government agency, or as a subcontractor. This series of articles presents an overview of both, plus a primer for getting started.

Government contracts can be an excellent source of revenue for your business. Federal, state, and municipal agencies routinely contract for outside support - even when the economy takes a dip and business is harder to come by.

The key to winning a government contract is knowing the system - the specific system that an agency requires you to follow. Don't let the red tape intimidate you. Once you clear the initial hurdles, the rewards can far outweigh the challenges.

To find government contracting opportunities in your area, try these searches in the search box below:

Let's say you're in construction and your service area is Miami. In the search box, you would type "RFP construction Miami" (Just those words, NOT the quote marks!)
For example, enter into the search box:
RFP construction Miami
But type in YOUR specialty and YOUR city/region/state

Other options for searching:

"request for proposal yourspecialty yourarea"

"government contracts yourspecialty yourarea"

Government contracts vs. private contracting

Projects for the government are covered by strict statutes and regulations to protect the public and reassure taxpayers that their money is being spent properly. As a result, the contracting process involves more paperwork than most private contracting. There are no verbal agreements in public works.

"Government contracts are different in several ways," says Nelson Colvin, president of Golden Oak Co-Operative Corporation in Granada Hills, CA. "To begin with, most public works jobs are prevailing wage. Public works as averse to private work is very highly competitive. For example, contractors are on a much bigger margin than public works, while public works typically involves a greater volume. So markup is less. But you're working with a higher price in labor.

"You also have more outside agency inspection, which is often extremely critical. And it's much more paperwork-intensive: tech submittals, payroll, and legal (lien) documentation, just to name a few areas."

Since the government typically requires more paperwork, many businesses never enter the market. So what's in it for those who do?

Good opportunity for stable businesses

Doing business with the government won't make you instantly wealthy. But it can certainly work to your financial advantage. For one thing, it can help you to level out the economic peaks and valleys during the business year. If you can apply the profits from government revenue to paying for your business overhead, you can be more selective with other contracts that involve a higher margin.

"One of the good things about contracting with the government is that when the economy is tough, Congress pours dollars into public agencies to help jumpstart the economy," Colvin says. "When the work is properly done, you know you'll get paid."

Next: Is Your Business Ready For Government Contracts?

Also see: How to Get Government Contracts - The 5 Basic Steps