Unlocking Over $140 Billion – How to Navigate Federal and State Markets
As you know, the US government is the world’s largest purchaser of goods and services; the federal government buys everything. The government spends upwards of $700 billion a year in discretionary spending and of this, 23% is targeted to go towards small businesses. What this means is that in any given year, there is a 140 billion+ dollars of opportunity for small businesses to do business with the federal government. Even at the state level, California is the 5th largest economy in the world, offering great opportunities for small businesses through state certification programs.
The question then becomes – How do I get started? Small businesses that are considering doing business with any government agencies must do upfront market research to determine the feasibility of such an endeavor. Let’s review the market research tools you can use to determine if there are government contracting opportunities.
Federal Contracting
One of the best ways to figure out the feasibility of doing business with the federal government is to look at historical contract information. The federal database that houses all contracting information is called the Federal Procurement Data System (FPDS).
By utilizing the information in FPDS, small businesses can determine the following information:
- The federal agency that awarded the contract
- What goods and services were purchased by that agency (i.e., search by NAICS code)
- Where the agency is located and whether the contract was nationwide or confined to a specific geography
- If it was a multi-year contract, then the database will indicate when that contract is scheduled to be completed and perhaps recompeted.
- The type of contracting vehicle the agency used for that particular contract
- i.e. whether or not this was a single instance contract or part of a multiple award contract in which there were several awards made, or even determining if the agency did a small business set-aside contract.
- The name of the successful awardee in case the small business is looking for potential subcontracting opportunities. This is also a good insight into your competitors!
There is a subset portal within FPDS that provides a more user-friendly interface for doing market research. This is known as USAspending.gov and the nice thing about this tool is that you can search for contracting activity down to the congressional district level, allowing you to see what sort of contracting activity is taking place in your own backyard.
State Contracting
As the 5th largest economy in the world, the state of California offers a great opportunity for small businesses. For those businesses that are looking to do business with the state of California, the procurement database for previous contracts is known as The State Contract & Procurement Registration System (SCPRS) which tracks overall total contracting dollars and contracts procured by the State of California. Here again you can tell what kinds of contracts have been awarded in the past, and by searching through your industry code and even specific agencies, you’ll be able to find out when contracts have been awarded, as well as which contracts will be up for renewal in the future.
Local Contracting
www.apexnorcal.org/local-contracting
Many of the clients that I’ve worked with have been around for a while, however, they are now thinking about getting into the public sector as a new customer space. Along those lines, I suggest that they start by registering with their local cities and counties in the areas where they think they will want to do business. This way they can be apprised of upcoming bid opportunities but also, they’ll have access to previous contract information. The reason that’s important is that a lot of times cities and counties will award contracts for products and services that will span over multiple years, and by looking at the historical data, small business can apprise when these follow-on contracts will come up for bid and prepare accordingly. Because there are taxpayer dollars at work, all this previous contract information is public knowledge and readily available. It might take a little bit of digging to figure out which procurement system the specific county or city uses however, you should be able to, there again, search by keywords or industry codes to find out previous contact information.
Selling goods and services in the public sector is not for the faint of heart. It requires a lot of tenacity, however, if you focus on targeted agencies and have a clear understanding of your value proposition and how that differentiates you from your competitors, it can be very lucrative. If you haven’t done so already, I encourage you to sign up as a client with the Norcal APEX Accelerator. We can help demystify public sector contracting and provide a good foundation for small businesses looking to start in this arena.
If you are looking for help with government contracting or want no-cost help to find contracting opportunities, please contact your Norcal APEX Accelerator counselor for assistance or apply for services today!
If you have more questions, please contact us at info@apexnorcal.org or 707.267.7561
Authored by: Paul Tavernia, Norcal APEX Accelerator Procurement Specialist
