Government contracting is an industry where businesses and contractors are left wondering where to start due to its broad procedures and need to know information. That said, we came up with the idea of enlisting down the frequently asked questions and the basic knowledge you need to know about the government contracting industry.
Table of Contents
The federal government offers federal business agreements of different types. They are classified as:
A. Set Aside Contracts
Set aside contracts have two classifications – competitive and sole-source set-aside and which both help small businesses to compete and win federal solicitations.
I. Competitive set-aside
Competitive set-aside contracts are offered for small businesses capable of delivering and performing the work—projects under this contract classification amount under one hundred fifty thousand dollars.
II. Sole-source set-aside
Sole source set aside, contracts are often awarded without a competitive procurement process. A sole-source contract is a standard where a single business can only meet the specification of the agreement. However, the sole source contract is still available for potential vendors to bid on at some point.
B. Joint venture
Joint ventures or businesses can compete for federal business opportunities for small businesses and other business categories such as HUBZones, WOSB, and SDVOSB. However, before a company negotiates on teaming agreements on joint venture contracts, it must first surpass the SBA requirements.
C. Fixed-price contracts
Fixed-price contracts are one of the riskiest types of federal contracting agreements because the contractor is liable for all the expenses, earnings, and losses. The reason is that this type of contract established a price that does not tend to change.
D. Cost-reimbursement contracts
A cost-reimbursement contract evaluates the project expense and budget ceiling that a prime contractor must meet and not exceed, especially without the consent of a contracting officer.
E. Incentive Contracts
Incentive contracts are used whenever contracting opportunities can be solicited for less than any amount of money. Incentive contracts pay up the technical performance of the contractor and help to meet the procurement goals by
F. Indefinite-Delivery Contracts
Indefinite-delivery contracts are used to purchase goods and services when the federal is unsure of the volume and usage time. Indefinite-delivery agreements are divided into three categories.
I. Definite-quantity
This kind of business agreement is used when the specific number of products and services are determined before the proposed project.
II. Requirement Contracts
A requirement contract is an agreement where the supplier agrees to supply all the products or services the procuring federal government office needs.
III. Indefinite-quantity contracts
Indefinite quantities are contracts that showcase an undetermined amount of supplies or services needed for the project.
G. Time-and-Materials
Time and materials agreements are the total opposite of fixed-price agreements. This type of government contract is frequently used in construction and product development industries where changes in the project’s scope are unnecessary.
H. Labor-Hour
Before labor-hour contracts are offered to businesses, the federal review first the material costs and then set a per-hour labor rate. One benefit of this agreement is that contractors are not obliged to provide the materials needed, unlike the time and materials agreements.
I. Letter Contracts
Also known as Undefinitizes Contract Actions (UCA), this category is used when the federal can’t establish a procurement agreement in time. With letter contracts, federal contractors can start delivering the products or services immediately.
Yes! According to the rules and regulations set by the Freedom of Information Act (FOIA), the public has the right to request federal contracting records since the resources used for funding came from the citizen’s tax.
But, just because federal solicitation are public records, does it mean that all the contractors’ sensitive information is given to the public too? No. Based on FOIA Exemption No. 4, releasing information to the public comes with a few exceptions, whereas the trade secrets, commercial and financial details of contractors or businesses will not be disclosed to the public.
The federal government publicizes contracting opportunities on different federal government websites. Here are some gov websites where you may find lists of federal contracting opportunities:
SAM.gov
SAM.gov is a federal government site where federal opportunities valued at $25,000 or more are posted. Previously awarded federal business agreements are also found on the website, which can help you prepare your bid successfully.
Dynamic Small Business Search (DSBS)
The Small Business Administration maintains a federal government site called Dynamic Small Business Search. The site stores and displays all the profiles of businesses registered with the System for Award Management (SAM). The website also provides a list of federal contracts reserved for small businesses.
SubNet
If you feel that your business is not prepared for serving a prime contract, you may still get into federal government contracting by being a subcontractor. Subcontracting with other small businesses or prime contractors will give you a better understanding of how the industry works and help you to get ready for bidding on your first prime contract.
GSA.gov
The General Services Administration, commonly known as the Federal Supply Schedule and Multiple Award Schedule (MAS), is a website where long-term and large federal business opportunities are found. The GSA was intentionally made to help different federal departments quickly engage with small businesses.
As mentioned above, the System for Award Management or SAM is an official government organization website that secures the available federal contracting opportunities. To find the list of opportunities, just head over to their home page and click “Contract Opportunities.” One good thing about this website is that you can request an analysis report to overview previously awarded contracts.
Again, the United States Government gives importance to transparency. Aside from the websites mentioned above, you can review the government’s spending history details prepared by the government accountability office posted at USASpending.gov. On the other hand, you can use the GSA’s Forecast of Contracting Opportunities to see the trend in the federal marketplace.
Most of the time, open federal business opportunities and set aside contract for small businesses are posted on the one-stop website SAM.gov. However, you can use the other mentioned websites above for more available federal business opportunities.
USA.gov provides information on the vital steps of being part of the federal marketplace. As stated on the website, here is what you need to know to offer your products or services to the local administration successfully:
The Department of Defense usually publishes all its contracting opportunities at SAM.gov. However, you may also check the official website of the Department of Defense to know more about them.
With thousands of contractors available in the marketplace, getting to know the federal vendors of different industries such as health care, defense, construction, and IT may take some effort to find out. That is why we have enlisted them for you:
The United States Government is known to be one of the biggest spenders worldwide, and it is consistently setting aside budgets for federal vendors. That is why we can conclude that the federal contracting industry offers attractive opportunities to grow small businesses or large corporations.
