How to Bid on Government Contracts

You may think that government contracts are only for large corporations, but this isn't the case. Small businesses can and do win government contracts on a regular basis. Bidding on federal government contracts is unlike bidding with local government entities, as federal bids are subject to a specific process, but with the right preparation, you can be successful. We'll show you how.


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    Access the Small Business Administration guide. It will help you with procedures and policies that you must adhere to when bidding on government contracts.
    • Seek out organizations—including your local or regional Chamber of Commerce or nearby college—that offer tutorials, seminars, online classes and other guidance that can help you through the process. Some cities also have a federal procurement office.
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    Set up a System for Award Management (SAM) profile. The SAM acts as a master list of all the businesses who wish to work for the federal government. Treat your SAM profile like a sales pitch. Include your capabilities, special equipment and skills that you can bring to the job you're bidding on.
    • Experience counts a great deal, especially if you can relate it to the contract on which you're bidding. The government also looks for stability; it wants to see that you have been financially sound for the last few years, which indicates you'll be in business in the years to come.
    • You will need to obtain your business DUNS number, which refers to your physical address. You can apply for a number free online at the Dun and Bradstreet website. You'll also need your Taxpayer Identification Number handy.
    • SAM registration is free. After you complete your profile, it will be posted within 72 hours. If awarded a job, the SAM facilitates automatic payments.
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    Check Invitations For Bid (IFB) through government agencies. All IFBs are posted online at the Federal Business Opportunities government website. Each IFB will dictate details of the contract. Most IFBs are for contracts of $100,000 or more.
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    Evaluate your company and how it would match up with a job offer in an IFB. Be completely confident that your company can complete the job and do it well before bidding. If you are awarded a contract and fail it most likely will be your last government contract.
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    Follow the rules and regulations of writing a bid. Utilize the Small Business Administration, your local procurement office, consulting firms and other resources.
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    Research past bids which are public record. Make sure your bid is low but also realistic. Significant past award information and raw data are available from the US Government at the Government's procurement sites ([1], [2]).
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    Use data analysis tools and techniques to target those contracts you have the highest likelihood of winning. [1], [2], [3]
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    Respond to each requirement outlined in the IFB in your bid. Make sure your bid is clear and points out the direct benefits of working with your company.
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    Consider partnering with another business.
    • Small businesses can be somewhat limited in capability but by partnering you can fill in gaps.
    • Some government contracts can only be awarded to those businesses owned by women, minorities or veterans. If your business doesn't fall into one of those categories, it may be helpful to pair up with a business that does.
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    Fill out any required forms and submit your sealed bid. Bids will be opened at the assigned time as listed in the IFB.


  • Even if you aren't awarded a government contract, you can still get a piece of the action and profit by subcontracting with companies that do hold contracts.
  • If you aren't awarded the contract but are the low bidder, perhaps the government isn't sure your business is capable of handling the contract. This can happen to small business who are first-time bidders. In those instances, you can request that the Small Business Administration review your business and submit a Certificate of Competency to the awarding agency.
  • Be extremely selective because of the amount of time and effort that goes into bidding on a government contract. There's also a certain amount of stress involved as most deadlines are tight--a month or less.

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Categories: Finance and Business