A great source of reliable, profitable and repeat business is local schools and other government agencies. Becoming a qualified vendor is easy if you know the steps required by the agencies you want to serve.
Whether you have Federal, State or local government clients in your area, each likely has its own rules for what is required to do business with them. When you understand how to take advantage of the policies they have established to help the small business community, you can put your business in a great position for success. Here are a few useful tips to get you started.
1. Register. Each local government agency and school district has its own vendor requirements. Some may inquire about licensing and insurance coverage, but most ask for nothing more than a simple, free registration with their procurement department. Most of the registrations can be completed online. Be sure to have your business & tax information handy in order to speed up the process.
If you have a military or othe Federal agency in your area, you will need to register on the Federal procurement website located at SAM.gov. Here you must provide more information than most municipal & state agencies require, but the effort is usually well worth it, given the size of the Federal purchasing budget. Once you are registered, you can sign up for email alerts for any opportunity that matches NAICS or SIC category.
2. Know your category. Many government purchasers require you to provide your Standard Industry Code (SIC) or North American Industry Classification System (NAICS) number. You can find your SIC at www.OSHA.gov and your NAICS code at SBA.gov.
These classification systems simply permit government buyers to categorize where their money is spent. It also helps them locate qualified vendors when a need for your services is available. Be sure to include all SICs and NAICSs that apply (if only remotely) to your business. Doing so helps you cast a bigger net for government funds.
3. Ask for the business. Government purchasers are as busy as anyone else. They reward companies that make their lives easier. One way to do so is to stay on their radar by asking to become a “sole source” provider. The “sole source” designation gives the purchaser the authority to award business to you without having to solicit competitive bids. Procurement officers have more power than you might think when it comes to spending government funds, so it pays to get any advantage you can.
4. Claim your set-asides. The Federal government requires a certain percentage of their budget go to “set-aside” groups, such as small business, woman-owned, veteran-owned, Native American-owned and others. You may claim any set-aside group that you qualify for, so look into all that you may be eligible for. The more groups to which you belong, the better your odds of earning new business.
5. Introduce yourself. Many government buyers have a catolog of vendors they have met with. Make sure to get your spot in their book by sending them a “capabilities overview” of your business, which briefly describes the service you offer. We recommend that you limit the information to one page, and include the information they need to determine if you are qualified to serve them. Include e basics like your company name, contact, phone, fax, email and website. Also include your service areas (by name or ZIP code), your SIC and NAICS codes, and your set-aside designations. Remember, the capabilities overview is about you, but is for them. Highlight the things they care about, like NAICS and set-aside info. Send government purchasers an update each year, and consider including recent customer testimonials and pictures of rentals you have performed in the last year.
6. Accept purchasing cards. Most government buyers these days have purchasing cards, or “P-cards”. These are simply government-issued credit/debit cards that purchasing agents use to pay for services. If you can’t accept this form of payment, you won’t be disqualified from doing business with them, but you may have to wait weeks or longer for ACH or manual check payment.
7. Get paid faster. When you serve government clients, and the Federal government in particular, they make accommodations to pay small businesses faster than the standard “net 60, terms. If you must invoice the government for services (which is typical for amounts over $3,000), send the payment officials a “GFEBS” request via email. In the request, state that you are a small business seeking faster payment terms. Be sure to include the contract number and your invoice number for faster service.
These few tips will help you outsmart your competition and tap into the billions of dollars spent by government agencies across the country. Good luck!