Pro Tip: Secure the Resources Needed to Fulfill Government Contract Terms…Before You Bid
There are hundreds of thousands of government bid solicitations posted right now in the Periscope Supplier to Government (S2G) database. That means there are probably several revenue-generating opportunities for your business at the federal, state and local levels that warrant immediate follow up by your team. But – if you're a startup, small business or just struggling to recover from the economic impacts of COVID-19 – you may not have the resources right now to fulfill contractual obligations should you win a bid. Don't let that deter you from putting together a proposal.
There are numerous funding programs offered by the Small Business Administration (SBA) for this very purpose, and larger entities can apply for loans from financial institutions and investors. So, you will probably be able to secure the cash needed to quickly increase production or inventory levels, secure more labor, and purchase necessities, such as insurance policies, infrastructure, and supplies. But timing is everything.
Most companies may want to wait to "plus up" until they know they have projects to warrant such investments. However, most government agencies are going to want you to prove that you have – or will have – the resources to deliver what they need when you bid on a government contract. If you make the short list, or become the preferred vendor, during the evaluation phase and can’t demonstrate fulfillment capabilities when the procurement official calls, you may automatically be disqualified.
In other words:
- Do take the time to determine your resource obligations and needs by thoroughly reviewing the requirements in each solicitation and then conducting an extensive business review before you bid. You can find tips on what to look for during the latter process in this blog post.
- Don't overcommit...to anyone. Be realistic, and honest, about your capabilities. This is true when bidding and when building your assets. Don't take out a loan unless you're sure you'll be able to repay it. And don’t bid on a contract if you’re unsure about whether or not you’ll be able to follow through. In many ways, trying to win business from a government agency is much like buying a house. When you put an offer in on a house, it’s always good to submit a pre-qualification letter to show the buyer know you're serious and that you have the means to follow through if awarded the opportunity. By securing the proper resources prior to bidding on a government contract, you help to build trust in your capabilities and demonstrate that you’re a responsible company. By conducting that pre-bid business assessment and not being overly presumptive about your growth potential, you should be able to strike the right operational balance and secure support for your proposals.
- Do be ready to open your business’ books to both the buyer and the bank. Both are highly risk averse and giving your word that you're "good for it" won't be enough to win them over, or win that bid. If you have a strong performance track record, note that (on paper, with references to validate) as well as other indicators of your business’ long-term stability.
- Don't be afraid to ask for help from government agencies (to fully understand supplier and contract requirements, performance expectations, the evaluation process and more), third parties (such as the SBA, procurement technical centers and other experts) or even other companies. Once you know what type of resources and assets you will need to have on-hand on day one should you receive the order, you might realize that your best option is to team with other businesses in one way or another to pool resources and strengthen the proposal. Either way, pick up the phone and talk to people to see what’s possible.
Winning even a fraction of the bids you submit could equate to hundreds of thousands, even millions of dollars, over the long term. Depending on your own financial obligations and growth ambitions, that could be just the boost you need to achieve more stability, survive this pandemic and achieve your goals.
Do your research to understand what opportunities there are for you in the public sector. Monitor for new solicitations daily and commit to bidding on those that are best aligned with your business offerings and access to resources.