Small Business Procurement Primer

Federal Government

Today, the United States Government is the largest consumer of goods and services in the world. Government procurement represents a major market opportunity for the small business owner.

There are many misconceptions about the government market. Many believe that selling to the Federal Government, next to finding a pot of gold at the end of the rainbow, is the easiest way to fame and fortune. Others avoid government procurement opportunities because they are certain all the rules and regulations are there to trap the unwary company that dares to venture into this market. Both of these views should not be the basis for any company's decision to sell or not to sell to the government.

A company electing to enter this market should recognize that the objective of the federal procurement process is to acquire necessary supplies and services in a timely manner and at fair and reasonable prices.

There are several federal programs geared toward the small business owner that enables him/her to compete more effectively for government contracts. They are:

General Procurement - These opportunities are open to all small businesses. Government needs are matched with business capabilities in order to form a business relationship that benefits both parties. Certain requirements, such as the acquisition of a CCR and DUNS number, are necessary. The Small Business Development Center can provide assistance in the registration process.
Set-Asides - These are bid opportunities that are set aside for Small Disadvantaged (meaning, generally, minority owned) Businesses only. The small business must be certified as a 51% minority owned and operated business. The law for set~asides is aimed at improving small~businesses' access to federal contracts. It has raised the dollar value of contracts to be reserved from $25,000 to $100,000 (with some exceptions) for small businesses. The law also requires government~wide goals for women,owned businesses to be no less than 5% of the total value of all prime and subcontract awards for each fiscal year.
8(a) Program - This is strictly a set,aside program for minority businesses. Under this program, the Small Business Administration (SBA) negotiates a contract for supplies or services with another government agency, and then subcontracts it to an eligible minority small business that has been certified as an 8(a) client.

To be eligible for possible 8(a) certification, a minority business must be 51% minority owned and managed by a minority. The certification process is handled by the Small Business Administration. Most 8(a) clients remain in the program for at least three years learning to bid competitively and independently on other contracts during this time frame.

How to Enter the Federal, State, and Local Market

There are many ways to find out when different agencies are going to make a solicitation for an open bid.

First, anyone serious about doing business with the government should review the Commerce Business Daily. The CBD is a daily listing of U.S. Government procurement invitations for bids. This publication can also serve as a good source for subcontracting leads. As required by the government all solicitations $100,000 and over are published in the CBD. Your Small Business Development Center (SBDC) has information on how this publication can be obtained.

Second, every government installation and purchasing activity maintains a bidder's list of prospective suppliers. The bidder's list indicates which businesses want to sell their products or services to the government installation. A bidder's list registration form can vary from agency to agency. The SFI 29 is used for all federally funded agencies (i.e. military installations, VA hospitals). The state and local agencies use different forms but they all serve the same purpose for any small business that wants to sell its products or services. The Small Business Development Center will furnish the forms and assist with preparation.

Third, a business can increase its opportunities by registering their company's profile on the Central Contractor Registration (CCR) system. CCR is a computerized database that connects government agencies with a need to small businesses that can service and fulfill that need. Go to http://www.ccr.gov/SmallBusinesses.aspx for more information. Subcontracting opportunities are available at the Small Business Administration's SUB-Net at http://web.sba.gov/subnet/

Fourth, a small business can take advantage of the free procurement system services offered by most major universities in Alabama, via the SBDC. The procurement centers:

are specifically designed to assist the small business person with becoming aware of bid opportunities.
offer one-on-one counseling pertaining to procurement.
hold procurement workshops that are offered throughout the year to answer general questions and to update clients on new legislation involving government procurement activities.

Key Websites

http://www.fedbizopps.gov
This site lists all government opportunities - a "one face to industry approach".

http://www.defenselink.mil/other_info/business.html
Guide to doing business with the Department of Defense.

http://www.sba.gov
This site has a wide range of information pertaining to small business. It also contains SBA-Net, a gateway to resources, opportunities, and networking; as well as a direct link to the Pro-Net database.

http://prod.nais.nasa.gov/
This is the site for the NASA Acquisition Internet Service.

Local and State sites

(These are just examples; many more sites exist.)

State of Alabama, State Procurement and Vendor Information - http://www.alabama.gov/portal/secondary.jsp?page=Business_Procurement

City of Birmingham, Bidding Opportunities - http://www.informationbirmingham.com/city-of-birmingham-bidding-opportunities.aspx

City of Selma, How to Do Business with the City of Selma - http://www.selma-al.gov/HANDBOOK_6.14.07.pdf

This is the final section of the handbook.

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