This month it got a little easier to add to your client list the country's biggest spender: the US Government. The Small Business Administration announced its Women-Owned Small Business Procurement Programs (WOSB) which provides greater access to contracts with 83 industries by allowing procurement officers to set aside contracts for women-owned and economically disadvantaged women-owned businesses (EDWOSB). Federal statute already mandates government contracts over $3000 and under $100,000 be set aside for small businesses, with an additional 5% procurement targeted for women-owned small businesses, but results have never met the mark. While department and agency standards vary, in practice, procurement officers can now exclude other bidders once they receive a minimum of two bids from qualified women business owners. Furthermore, the February ruling requires the set asides go into effect in 2011 government budgets with over $30 billion of contracts available to women. SBA Administrator Karen Mills feels these contracts "can provide women-owned small businesses with the oxygen they need to take their business to the next level."
What's at stake? Each year the government purchases some $500 billion dollars worth of goods and services. Typically it spends in every category imaginable from goods, such as lab equipment, furniture, office machines, toiletries, clothing, and athletic equipment to services, such as accounting, construction, advertising and janitorial. Occasionally it even wades into unexpected territory. One Army contract totaled $5.6 million for T shirts imprinted with "Go Army." Another $500,000 contract went for a Spider Man impersonator to entertain troops abroad. Federal contracting consultant Lourdes Martin-Rosa, head of Government Business Solutions, advises business owners "to take advantage of every tool the federal government offers, while making yourself known to the right people within the government." The Small Business Administration provides requirements on its website; it also offers training and other outreach programs to help small businesses fulfill requirements. Additionally, the Federal Business Opportunities (FedBizOpps) website lists all government contract needs above $25,000.
Recently a survey by American Express Open, an initiative that supports small businesses with products, training and educational resources, agrees that given "the government goal of awarding 23% of their spending to small firms -- some $115 billion annually -- Federal contracting is an important avenue of growth for many small businesses to consider." Once they win Federal contracts, the report continues, "Women businesses achieve success in equal measure to that of their peers." But success takes takes time, about 17 months, on average, to land the first contract. Once they bid, the survey concludes, women win 43% of the contracts they seek compared to 40% for men.
While becoming contract ready requires extensive research, the steps are relatively straightforward. The first step is to register online in the Central Contractor Registration (CCR). While registration is free, basic identification facts and figure are required. One key is to select your proper product or service classification codes (NAICS) among the 83 categories available for women businesses. Choosing the codes can be one major key to success.
Ask small business owner Maureen Borzacchiello, CEO of Creative Display Solutions, an exhibit and events production firm based in Garden City, New York whose blue chip clients include JetBlue, Pfizer and American Express. When the economic slump hit, Maureen decided to explore government contracts, though she admits the project takes dedicated focus. "When I first looked at the categories of industries, I felt we fit two or three, but with more digging I have discovered 43 categories for which we are eligible. One area that turned up unexpected business was storage, a service Creative Display Solutions routinely provides its clients. The government, however, labels storage contracts "general warehousing," a big budget item at one particular agency which Maureen is currently targeting. Last year she won her first government contract from the Army.Her advice for women seeking government business?
Don't start out with the attitude that you should get these jobs just because you are a woman. Your first goal is to demonstrate you're a solid company and be willing to provide the financial records they require along with recommendations from other clients. To be a government contractor, you can't keep your receipts in a shoebox. You need a comprehensive business development strategy.
Consultant Lourdes Rosa-Martin, who also advises on government contracting for the American Express Open program, agrees that doing business with the government isn't a piece of cake. "But," she adds, "the resources are there because the government provides remarkable transparency." One website, USASpending.gov, provides details of previously-awarded contracts to help you determine if your prices are competitive. Furthermore, Lourdes adds, "there are 230,000 credit card purchasing officers ready to buy any product or service that costs $3000 or less at any time without further authorization. Just jump in."
One veteran Federal contractor, CEO-Founder Susan Rice of Cavanagh Group Services which provides onsite logistics management for disposal of nuclear, hazardous and toxic wastes to support environmental clean-up, currently derives 85% of her $22 million revenues from government contracts. In some cases, she contracts directly; other times she subcontracts from major companies who routinely develop lists of qualified suppliers. But with ballooning deficits and impending budget cuts, Sue Rice says she now plans to start chasing more private business to achieve a 50-50 split between government and private contracts. "When one sector peaks," Sue observes, "the other dips. For me the solution is to be nimble enough to ride the waves."
Follow Angela Haines on Twitter: www.twitter.com/@wStartup