Geoff Orazem shares advice on how to avoid common mistakes when looking for government contracts for your business.
Land profitable government contracts and make long-lasting relationships with government buyers. Use the right tools and processes to easily discover your niche. It’s easy to get buried under the licensing, registration, and administrative work. Anyone from small businesses or seasoned GovCon companies will benefit from using our helpful tips. Learn about what to avoid when looking for your next contract.
- Not Choosing the Right Codes
Understanding how to use the North American Industry Classification System (NAICS) and the Product Service Code (PSC) to filter opportunities is key for new GovCon businesses.
The NAICS and the PSC are key taxonomies used by government bodies to sort through companies and services provided respectively.
Knowing which ones apply to small businesses will considerably increase your visibility and the likelihood of winning a contract, and will save buyers the trouble of having to sort through companies by eligibility.
Determining which NAICS Codes and PSC are fit for your kind of business may be a daunting task at first, as the sheer number of requirements can confuse even the most seasoned professional. Thankfully, many online tools can provide you with the specific codes and training you will need to meet your sector’s prerequisites.
- Starting as a Prime Contractor
When bidding on your first contract, you will have to decide whether you want to be the prime contractor or a subcontractor in the deal. Knowing your company’s size and resources will definitely help you determine the path you’ll end up taking, but if you’re newer to these competitions, you’ll want to look into the benefits of being a subcontractor initially.
Starting small is the best way to ensure your past experiences have the biggest impact on a new customer market, or on a different customer base you’re trying to explore. Choosing to sub your first work is the best strategic decision in the long run, as you’ll likely be able to use your capabilities to the best effect. Your role in this hypothetical bid might not be as principal, but it will serve as justification for future contracts in which you will be the prime contractor.
A footnote to this issue: negotiate to give yourself the best advantage. Being a subcontractor does not mean less onerous contract terms; you will likely have to ask for those. In most cases, the prime’s obligations to the customer will be very transparent, so definitely use them to get the best deal on your first venture. Issues to be negotiated include:
Key points include:
- Pipeline planning
- Realistic intentions
- Contingency planning
Read the article, 5 Costly Mistakes New GovCons Make, on FedScout.com.