Reviewing the Value of Pursuing Government Contracts

Getting United States government contracts seems awfully lucrative. The billions of dollars that are spent for so many multi-national companies makes government contracts seem extremely profitable. Then there are a number of small business programs that help small businesses get a foot into the door. Sometimes that just adds to the idea that getting government business is easy. Nothing could be further from the truth. The reality is that while government contracts can be large, but it can also be low margin.
When evaluating government contracts one must look at their competition. If a business is use to competing with big business, then they can be assured they will be competing with them for government business. The upside is that most big businesses actually increases their margins when pricing for the United States government. This is to the small business's benefit as they just need to simply match or beat those prices. Competing with other small businesses can be harder because they will have many of the same advantages. It could be made even more difficult if the competition is already winning the contracts.

The United States federal government is the single largest purchaser of goods and services in the world. With a purchaser of that size there are plenty of large businesses pursuing that business. However, the US federal government has set goals to do twenty-three percent of its business with small businesses. There are many entities that exist both within and without the government to help small businesses get government businesses. However, within each government department there is one office every small business should know.

Each United States federal government department has an Office of Small and Disadvantaged Business Utilization (OSDBU) that exist to assist small businesses in finding business opportunities within that department and its many agencies. These offices are great because it gives small businesses a point of contact within each governmental department and also can be a guide to help one through the maze of agencies within each department. The OSDBU will be familiar with each department's purchasing history and any major projects. They will also be terrific in providing introductions to purchasing personnel and contracting officers within the department and its agencies.

If at all possible a business should make personal contact with each department's OSDBU with which they are interested in doing business. There are two ways to make initial contact. First and probably best is make an appointment in Washington, DC. Yes, this will necessitate a trip to the nation's capitol, but it could be a business's best marketing investment ever. Second is to seek a conference where many OSDBUs will be present. It may be possible to find such conferences within easy reach of a business's main office. The nice benefit of local conferences is that they often have state and local opportunities to network with also.

Understand that pursuing government contracts is typically a long process and making contact with the OSDBU is just the first step in marketing a business to the US federal government. There will be follow-up meetings with the contracting and purchasing people where a business will actually develop a long-term relationship. That part of the process can be long and complex, so the initial contact with the OSDBU will be thankfully painless and even pleasant. Also, understand the OSDBU is only a guide in federal procurement and will not have contracts ready to handout. They may have something presently pending that one's business is perfectly suited, but that would be the exception. Even if they did have such available, the OSDBU would only direct the business to the contracting or purchasing office making the offer.

Ultimately it is best to make a resolute decision to acquire government business, rather than to simply try getting government contracts. The process being long and difficult, it doesn't pay to simply try. Only the businesses that make the determination to get government business succeed, The main thing to remember is that getting government work will take time and effort. However, perseverance will pay off. That is when government contracts are most lucrative, because the government procurement personnel like to use the same people over and over. Meaning it may be hard to get in, but once a business is in, they are in.
Visit http://www.osdbu.gov/ to find a list of OSDBUs and more information.