Do you have what it takes to sell your products and services to the government or the military? If you’re an architect or general contractor, you could significantly increase your company’s business by becoming an approved government or military contractor. Our quick start guide to GSA schedule and the military procurement process can help you get started.
It’s true, the process to become an approved as a government or military vendor can be a little bit intimidating for the uninitiated, but those who persevere can be rewarded with a wide range of interesting business opportunities.
Find the red tape daunting? We can help. As a government and military approved supplier ourselves, we’ve prepared this quick overview of the steps necessary to help you get your first government contract. Formaspace is also open to partnering opportunities, either in the Prime or Subcontracting role.
Let’s Start at the Top: The Federal Acquisition Regulation (FAR) Rules
When dealing with government programs, it’s easy to quickly become overwhelmed with acronyms.
If you are new to procurement regulations that dictate how the federal government acquires goods and services, you might think you’ve stumbled onto a foreign language, made up entirely of abbreviations and acronyms.
To be frank, if any of us had the opportunity to design the procurement system over from scratch, we’d probably come up with a much simpler approach. Instead, like many aspects of our legal system, the procurement regulations have evolved over time to reflect the political will of Congress in Washington.
So to get oriented, let’s start at the top.
- The legal framework that governs procurement for the government and the military is the Federal Acquisition Regulation, commonly known as FAR.
When you visit the government’s official FAR website (acquisition.gov) you’ll want to look through key regulatory documents for procurement. For example, when you review the eighth FAR section (known as FAR 8), you’ll see how this part of the law:
- Establishes the mandatory priority order that government procurement agents must follow when awarding contracts.
- Defines the role of the Federal Supply Schedule program, which is also known as the General Services Administration Multiple Award Schedule Program (or GSA Schedule for short.)
- Creates additional rules and programs to cover particular circumstances. Examples of this include establishing rules for Blanket Purchasing Agreements (BPA) for planned ongoing purchases (such as supplies or furniture) by the government at predetermined prices, or the similar Basic Ordering Agreements (BOA), which allow the government to make purchases when the future needs are yet to be determined.
- Allows the GSA to delegate certain purchasing responsibilities to other government agencies in certain areas. For example, GSA delegates its authority to procure certain medical supplies to the Veterans Administration (VA) under the VA Federal Supply Schedules program (VA FSS).
- Restricts the GSA from delegating its role in government acquisitions to other agencies in certain areas. For example, per FAR regulations, only the GSA can procure non-military government vehicle purchases (e.g. make car and truck purchases).
Reading information and legislation on the FAR website will help you understand the relationship between the numerous agencies that regulate, negotiate, award, and manage government procurement contracts.
To keep up with the changes that Congress makes to the law, you should sign up for official FAR Alert Notices, known as FAN. You can also watch short videos that explain recent changes.
The Big Kahunas of Government Purchasing: The GSA and the DLA
Now let’s look at the GSA Schedule and its military equivalent, the DLA, in more detail.
As we mentioned earlier, the GSA (formally known as the General Services Administration) has the primary responsibility for negotiating a collection of pre-authorized contracts on behalf of the civil side of government.
Why have these two major purchasing agencies? By centralizing the acquisition functions, the government hopes to:
- Avoid ‘re-inventing the wheel’ each time the government needs to buy something by creating a repository (or schedule) of pre-approved, pre-negotiated contracts that government employees can use to make purchases.
- Ensure fair competition between suppliers to reduce the cost of goods and services paid for by taxpayers
- Prevent favoritism, graft, and kickbacks when awarding government contracts.
- Make the contract-award process an open and transparent process, so taxpayers can see where their tax dollars are spent (certain ‘dark’ expenditures, such as secret military expenditures are not subject to these rules).
- Leverage the expertise of procurement experts to manage complex acquisitions while avoiding fraudulent or historically low-performance suppliers.
GSA and DLA Storefronts and Exchanges
Just as consumers are increasingly using online shopping, so too are government employees.
However, regulations prevent government employees from ‘shopping’ just anywhere — a civil servant can’t visit the regular Amazon website and buy a new computer for government use — instead, they have to make purchases from a list (or schedule) of pre-approved government contracts.
To accommodate the high-volume of government purchasing, the different agencies have created their own storefronts or exchanges that allow government employees to shop online. Here are some of the main ones:
- GSA Advantage!
GSA’s storefront for government employees to purchase approved goods and services is known as GSA Advantage!(Note to the reader: while we are excited about this topic, we should point out that the last exclamation point is part of the official name of GSA Advantage!)
GSA also hosts a ‘storefront’ for government procurement specialists to solicit bids from the list of GSA-approved vendors for custom projects. This storefront, called e-Buy, is an online electronic Request for Quotation System (RFQ) that allows the government to post requirements, obtain quotes and issue orders electronically.
- DOD EMALL
The Department of Defense (DOD) was an early adopter of online technology for ordering supplies. The DOD EMALL (short for electronic mall) was launched in 1993, well before most of today’s Internet-based electronic commerce systems. Like the GSA Advantage! website, the DOD EMALL allows military employees to order goods and services from lists (aka schedules) approved by the DLA. TIP: Prospective prime vendors wanting to sell goods to the DOD (and the VA) will want to enter into Troop Support Distribution and Pricing Agreements (known as DAPAs).
There are other specialty on-line storefronts as well. A good example is ECAT, which allows government employees to browse, compare, and order medical supplies, including surgical, laboratory, pharmaceutical, and dental items.
Find out How Much Government Business Your Competitors Have Won
As we mentioned earlier, one of the goals of government purchasing agencies is to provide transparency. Nearly all purchases made by the government are searchable using the USA Spending website. Visit the website and take a look at spending in your state by clicking on the map, or look up a company by its official legal name (or the Dun and Bradstreet DUNS number if you know it.)
The data is pretty accurate. It will get better soon, as the Office of Management and Budget (OMB) has mandated that the GSA revamp its classification system to use correct Activity Address Codes (AACs) to identify both awarding and funding offices for procurement awards recorded in the Federal Procurement Data System (FPDS).
(Yes, we know… there are quite a few acronyms to learn in government procurement process.)
How Can You Get Your Business on the GSA Schedule?
If you looked up your competitor and see they have a lot of government business, you’re probably motivated to learn how to get your company on the GSA Schedule so that government employees can buy your products or services.
How do you go about getting your business approved as an official vendor on the GSA schedule?
First, do your homework. This will be a long process, with many steps.
Are you qualified?
Have you been in business for 2 years? Do you sell commercially available products? Are you financially stable? Are your products made in the US or an approved country?
Review your Corporate Legal Structure and Registration
Your business will have to be registered with Dun & Bradstreet. You’ll need a DUNS number (a registration number) and a Dun & Bradstreet “Past Performance Evaluation” as part of your GSA application. This process can take a month or two – so plan ahead.
You’ll also need to determine which NAICS (North American Industry Classification System) code applies to your goods and services. Why? Some programs and regulations apply to certain NAICS codes but not others.
The company’s ownership, organizational structure, and primary location should also be scrutinized in light of special programs designed to help disadvantaged businesses, such as those majority-owned by disabled veterans or those based in a historically low income census tract. We’ll cover this later in more detail.
Find Your Place among the Different GSA Schedules and Download a Solicitation
Your next goal is to find a solicitation that you can bid on (e.g. submit a proposal).
But we simplified things a little bit. As most people do, we’ve been referring to the GSA Schedule like it’s a single comprehensive list. It turns out there are actually more than three dozen individual GSA schedules, each of which covers a specific category goods and services. To avoid rejection, review the lists carefully to pick the appropriate one from the GSA eLibrary.
Once you have confirmed which GSA schedule is appropriate, search for solicitations from that schedule on the GSA eLibrary. Choose the option to view the available solicitations on FedBizOpps. This will open up the FedBizOpps website where you can download solicitations.
Make a Your Proposal to the Government
Now that you have downloaded a solicitation, it’s time to write up a proposal. Follow the instructions carefully.
During the time you are working on the proposal, you should also check the website on a regular basis for any possible changes made to the original solicitation by the government (known as a Solicitation Refresh).
When your proposal is ready, you’ll need to submit it electronically using the eOffer website.
A procurement specialist (contracting officer) will review your proposal carefully. If it’s not rejected, you will be asked to negotiate a final price on a conference call.
If you are successful, then you will submit the final version of the proposal, called the FPR (Final Proposal Version). In return, once the paperwork is processed, you’ll receive a Contract Award and your GSA Schedule Contract Number.
Catch 22: Need Experience to Get a Contract. Need a Contract to Get Experience.
Will you get that GSA contract award the first time out? Not typically.
You may find that a lack of past performance experience is holding you back.
The contracting officer will look at your past government contracting history in the Past Performance Information Retrieval System (PPIRS) system.
If you don’t have any experience, you may be rejected.
It’s a Catch 22!
You need experience to get a contract, and you need a contract to get experience…
So how can you catch your first break?
Get Your First Break as Subcontractor
In the world of government contracting there are two broad categories: Prime Contractors and Subcontractors.
Prime contractors are the ones who bid and win government contracts. They are legally responsible for the completion of the contract. Prime contractors are generally required to perform more than half the work (known as “workshare”), but they may choose to (or, as we’ll see below, may be required to) bring on subcontractors to help meet the contract delivery requirements.
Prime Contractors can hire your company to produce some of the work product. In some cases, you may have direct contact with the government, in other cases, you may not. Nonetheless, the experience working as a subcontractor on a successful contract will help give you the necessary “past performance” history needed to win a future contract as a Prime Contractor.
So, for many successful government contractors, the first step to success is as a subcontractor working for a prime contractor.
Tip: don’t assume subcontractor roles are by definition small. Look at any major aerospace project, and you’ll see it’s not unusual for some subcontractors to earn hundreds of millions of dollars.
8(a) Business Development Program: Federal Set-Asides for Small Businesses
But what if you are having trouble making the right business contacts to establish yourself as a subcontractor?
This is often the case for small businesses, including those whose owners are members of designated disadvantaged communities.
To ensure a fair distribution of federal government contracts, there are formulas which reserve, or ‘set aside’, a certain portion of contracts for small businesses and/or small businesses that are designated as ‘disadvantaged.’
Collectively these rules fall under the 8(a) Business Development Program.
Your best resource for learning about these programs is the Small Business Administration (better known as the SBA). The SBA regularly conducts local community outreach programs with seminars designed to help small businesses learn the ins and outs of using these programs to get work from the government.
How do 8(a) Business Development Set-asides work?
Let’s look at a couple examples in very simplified terms. (Caution: we cannot possibly recreate all the rules, exceptions, and other classifications in this short overview so please refer to the SBA and GSA rules for authoritative guidance.)
If the government has a solicitation for a price between $3,500 (what they call the micro-purchase threshold) and $150,000 (the Simplified Acquisition Threshold or SAT), the contract will be set aside for small businesses (as long as two or more small businesses compete for the contract, known as the Rule of Two).
Another example: Large businesses acting as Prime Contractors must subcontract a portion of the work to small businesses and other disadvantaged groups if the value of the contract is over $700,000. (In the case of construction projects, the value rises to $1.5 million before set-asides are required.)
In addition to requirements for individual contracts, the government has also set overall top line goals for its Prime Contractors. At least 23% of all federal government contracting dollars should be awarded to small businesses. Within that percentage, the government also wants its Prime Contractors to set aside specific percentages of subcontracting work for small disadvantaged business:
|Small Business Category||Percentage
|Women Owned Small Business (WOB)||5%||SBA WOB website|
|Small Disadvantaged Business (SDB)||5%||SBA SDB website|
|Service Disabled Veteran Owned Small Business (SDVOSB)||3%||SBA SDVOSB website|
|Historically Underutilized Business Areas (HUBZone)||3%||SBA HUBZone website|
Again, we’d like to emphasize these examples are not the only programs available. Visit the SBA website to learn about other set-asides, as well as new programs like the SBA’s Mentor-Protégé Program, which matches successful firms with 8(a) Business Development Program Participants.
Partner with Formaspace to Bid on Government Projects
If you are an architect or general contractor, hopefully, we’ve attracted your attention to the possibility of pursuing government contracts.
If so, Formaspace can be your partner.
As a GSA certified contractor, Formaspace can partner with you as either a Prime Contractor or as a Subcontractor.
We are also looking to partner with small or disadvantaged businesses as well.
To learn more about these opportunities, take the next step. Contact our Government Contract Design Consultant specialist today.