4 simple steps for getting started
Government contracts are a big opportunity for small businesses. The federal government allocates at least $5 of every $100 contract dollars to women and minority-owned small businesses each year, according to the Small Business Administration. State and local entities are following suit so that minority and women-owned businesses get their fair share of contract awards.
To be sure, tapping into the multi-billion dollar government contracting market can be a great strategy for small businesses. But, it’s a big decision and you’ll need to take steps to make sure you’re ready. Before you can compete for these contracts, your small business must meet some basic requirements like getting certified. And to bid on and win government contracts, you’ll have to offer government agencies a competitive price for your products.
The process may seem daunting, but as a partner of the Small Business Administration, Pathway WBC can be a resource. Before jumping into the government contracting market, we’ve laid out the first four steps so that they’re easy to follow.
Step 1 – Assess how ready your business is for getting with the following questions:
- Does the government buy the product or service that you sell?
- Are you capable of fulfilling a government contract with your time, staffing and materials?
- Are you a for-profit entity?
- Are the majority of the owners of your company US Citizens?
- Do you have good credit?
- Do you have a solid accounting system in place that produces financial statements?
- Do you have cash on hand?
If you’ve gotten this far, you’re most likely in pretty good shape to start the process of becoming certified to bid on government contracts. To continue, all you will need is Internet access and your Employer Identification Number (EIN).
Step 2 – Identify your NAICS codes and size standards for your industry. NAICS (pronounced “nakes”) stands for North American Industry Classification System. It’s the standard for classifying business establishments and it groups them according to similarity in the processes used to produce goods or services. All industries will have at least one associated NAICS code. Learn more about NAICS at census.gov/eos/www/naics and SBA’s size standards at sba.gov/size-standards.
Step 3 – Register in SAM (System for Award Management) and create a profile. To sell your products and services to the federal government, your business MUST be registered here. Your profile is your business resume and you should write it in a way that helps you stand out from other vendors. You must update your profile once a year to stay active.
Step 4 – Obtain a free DUNS number. The Data Universal Numbering System, is a proprietary system developed and regulated by Dun & Bradstreet (D&B) that assigns a unique numeric identifier, referred to as a “DUNS number” to a single business entity.
Are you a woman-owned small business? Register for a Blue Sky Business Modeling Workshop to learn more about how we can help you grow you business.