The Government Bidding Process: Identifying the Various Contracting Methods

In essence, choosing a contractor is largely based on information processing. First, the deciding government agency collects information about the participating businesses, evaluates every organization based on specified categories, and compares them based on the previous assessment to determine which is best. The theoretical process is basically the same regardless of the contracting method applied.

Here, the deciding government agency must come up with an excellently designed process that will help them get credible information about the participating organization, evaluate this information, and compare the organization options to name the best. In designing this process, the deciding agency must be able to put into consideration their main objectives of getting the best quality, schedule, and cost for the project/contract being decided on.

The Simplified Procedure

The 1994 Federal Acquisition Streamlining Act simplifies the government buying process. It has eliminated much of the restrictions on government procurements amounting to less than $100,000. The act allows federal agencies to make use of simplified procedures to canvass and evaluate bids of up to $100,000 instead of open and full competition. For all planned purchases over $25,000, government agencies are obliged to advertise in www.FedBizOpps.gov.

The current reform legislation likewise requires all government procurements under $100,000 but more than $2,500 to be secured only by small businesses, unless the contracting authority cannot get proposals from two or more small businesses that offer competitive quality, price, and delivery.

Agencies do not need to obtain competitive quotes for “micro-purchases” or procurements amounting to $2,500 in individual items or multiple item purchases whose accumulated amount is less than $2,500. Micro-purchases however are no longer reserved for small businesses, and agencies can use a government purchase card for micro-purchasing.

The Sealed Bidding Process

When the requirements are complete, clear, and accurate, the government contracts competitively with a sealing bidding process that makes use of an invitation for bid (IFB).

An invitation for bid will normally include a comprehensive description of the product or service, bid preparation instructions, purchasing and packaging details, clauses to be included in the contract, shipping and payment conditions, deadline for submission, among others.

These bids will be opened in public, read aloud, and recorded at the time designated in the invitation at the purchasing office. The agency awards the contract to the low bidder who is determined to have promptly and appropriately responded to the requirements enumerated.

FedBizOpps, which provides a direct link to these invitations, holds a regularly updated list of these government-wide IFBs. Contracting agencies browse the Central Contract Registration to search for qualified small business contractors; hence the need for small businesses to be registered here if they want to be considered to have business with the government.

The Contract Negotiation Method

In cases when a contract values more than $100,000 and requires the procurement of a specialized product or service, the government may issue a requestfor proposal (RFP) to prospective contractors who would be interested to provide solutions to the request including the price for completing the project (contract).

In other cases when the government is merely looking into the possibility of purchasing a product or availing of a service, it may send out a request for quotation (RFQ). A contractor’s response to an RFQ is not considered an offer unless the order is an offer by the government to the supplier for the purchase of particular supplies or services within specific conditions. The contract is only established with the supplier (contractor) accepting the offer.

It is worth mentioning that the government uses purchase cards for less-than-$2,500 purchases, sends written solicitations for over-$25,000 purchases, and makes verbal solicitations for purchases less than $25,000.

As opposed to the traditional government procurement process, today’s acquisition reform places increased significance on “best value,” where the government awards the contract not to the lowest bidder but to the one that relatively satisfies the requirements even at a slightly higher cost. Here, agencies will have to clearly state in their solicitation papers their complete evaluation criteria and other relevant factors that will matter most in awarding the contract.

The Consolidated Purchasing Programs

Government agencies will generally have common procurement needs, such as furniture, food supplies, lighting fixtures, computers, machine maintenance equipment, etc. By centralizing most of these purchases, the government is able to make great economical savings.

Modern-day procurement reforms have introduced multiple award contracts (new or modified acquisition vehicles) like government-wide acquisition contracts (GWACs) or multi-agency contracts that promote long-term contracts with fewer contracting agencies (vendors). These prominent vehicles enable government agencies to fill their requirements quickly by establishing orders on already-existing contracts without the need to start a new procurement process from scratch. Also, different businesses may be competitively awarded multiple tasks and contracts for the same products and services.

The Department of Veterans Affairs, the Defense Logistics Agency, and the General Services Administration are the three largest administrators of these consolidated purchasing programs.

  

StateAndFederalBids has the world’s most updated database that holds almost 50,000 open government bids that is regularly updated by a competent team of researchers, keeping you on the forefront on the latest in government bidding opportunities for your business.

The Government Bidding Process: Understanding the Market

With a yearly purchasing expense of nearly $200 billion, the U.S. government is without a doubt the world’s biggest buyer of products and services. With civilian and military installations making an extensive range of purchases from gargantuan space shuttles to hospital beds and equipment to computer printers and ink, the government practically makes acquisitions of a wide category of products and services available.

What the Law Says

Federal laws require government agencies to establish contracting goals, with which 25 percent should go to small businesses. Contracts should likewise be awarded to small disadvantaged businesses, service-disabled businesses owned by veterans, HUBZone businesses, as well as women-owned businesses.

While these government-wide objectives are not always realized, they are critically significant in that federal agencies are legally obliged to reach out to small businesses and consider them for procurement opportunities. Hence, it is up to you to tune up your business products and services with the buying requirements of the government.

Doing business with the federal government is comparable to selling to a private entity. While the former follows a different set of rules and regulations, most marketing tactics that you may be familiar with and have been using can be used here as well. It should go without saying that it is critical to know the federal agency that you plan to go into business with and completely understand how your product or service can well be incorporated in their organizational system.

What SBA’s Role Is

The U.S. Small Business Administration is geared at promoting and encouraging economic development by being readily available to help jump-start young businesses and facilitate growth with the established ones. While it is no surprise that small businesses are often bombarded with considerable obstacles when trying to win government contracts, the SBA is here to help them go through these hurdles.

Closely working with government agencies and the country’s major contractors, the Small Business Administration helps ensure that small businesses are given fair chances of winning government contracts (and subcontracts).

What the Government’s Buying Process Is

The government purchases majority of its needed products and services exclusively from suppliers who meet their qualifications. Standard regulations are implemented and should be followed when making procurements. Unlike the average household, the government will have their own contracting officials follow procurement procedures that have been established parallel with those of the Federal Acquisition Regulation (FAR).   

Used by federal agencies in all procurement processes, the FAR is a standard set of rules that enumerates the steps necessary in completing the purchasing procedure—right from the moment someone in the government decides that there is a need to buy a product or avail of a service up until the procurement is completed.

The government will purchase a particular product or service by choosing among a range of bidding methods, which include sealed bidding, simplified acquisition procedures, consolidated purchasing, or contracting by negotiation among others.

What You Need to Do

When on the road to doing business with the government, get as much available information as you can on the federal agencies’ past contracts, awards, costs, quantities, set criteria, etc. Market your business and make it known to agencies that make potential purchasers.  

Take a good look at your company, and make sure that you know your products and services by heart. The government will be eager to know your track record, your credibility, your financial status, and the capabilities of your personnel, among others. This way it won’t be too hard to know what to offer them when the government will consider your company for a contract.

StateAndFederalBids prides in its extensive collection of state, local, and federal bids, covering a large selection of categories for products and services. StateAndFederalBids is your first step to establishing a solid, long-term business relationship with the government. 

The Contract Application Process: Everything You Need to Know

Awarding of government contracts is influenced by an extensive list of factors. It is more than just submitting the lowest bid and getting awarded for the project. Selling to government organizations entails the use of the same strategies and principles as when selling products or services to the average commercial consumer. Regardless, both customers are making sure they are guaranteed to receive top-quality products and services on time and at a reasonable price.

The Background Check

While a large percentage of government agencies do not require an extensive background investigation about the business, many will request information to be provided under oath including the business profile, owners, employees, finances, etc. Defense contractors and other agencies working with classified materials do need in-depth background check. For this, the company’s criminal, administrative, and taxpaying history will be carefully looked into before they can be allowed to get into a contract with the government.

The Registration

Prospective suppliers for all levels of government agencies are required to register prior to be their participation in the contract bidding. The registration process is critical as it provides the avenue with which the business’s basic information is gathered as it will be needed to determine and evaluate their qualifications. More often than not, the process is renewed on a yearly basis so businesses make sure that all information is not only accurate and concise but also updated. To know more about registering with the System for Award Management (SAM), please read here.

The Research

It should go without saying that before submitting any contract proposals, businesses should always conduct their own research so they will familiarize themselves with the government agency that they are planning to conduct business with. While price may be one of the most important requirements in these transactions, there are other variables that must likewise be carefully examined prior to submitting proposals.

In the planning phase of getting a contract, the business must also be able to accurately determine the decision makers as this may vary from one transaction to another. While some government agencies may be the ones funding the contracts, they may not be the same ones making the procurement decisions. In some cases, procurements are jointly conducted among many agencies or some elected authorities from various affiliations will have an influence on the decision-making process.

Identifying decision makers such as procurement offices, purchasing agents, and small business representatives and letting them know about your business and your specialty can be very important and play a role when the next bid comes up. Hence, successful government contractors make sure that they are kept abreast of current political issues as well as government prerequisites and establish strong business relations with opinion authorities and leaders who can share insights that may give them a competitive edge in the market.

The Proposal

Among the primary factors considered in the process of picking a company to award a contract with is the quality and comprehensiveness of their proposal. In fact, a prospective vendor’s ability to follow procurement instructions is one major determinant of the company’s ability to comply with the contract procedures. It is therefore important that the company reviews the RFP prior to submission to ensure that all requirements have been met. It is also not wise to include information not requested in the RFP to gain an advantage.  This information is seldom reviewed, and procurement officers do not waste time looking at miscellaneous company information.   Also, regardless of its quality, a proposal submitted beyond the given deadline is almost always never considered.

StateAndFederalBids highlights the world’s most extensive collection of state, local, and federal bids covering an expansive selection of categories for products and services. Whether you offer food catering services or provide construction and design materials or operate a minority-owned farming business, StateAndFederalBids is your one-stop shop for opportunities that will help you establish solid business relationships with the government.

Understanding the DoD’s Small Business Programs and Contracts

The Small Business Innovation Research Program

The United States Government program Small Business Innovation Research (SBIR), which is currently authorized until September 30, 2017 and regulated by the Small Business Administration, supports and encourages all federal agencies with exterior research funds in excess of $100 million to have a percentage securely reserved for contracts and grants to small businesses.

Every year, the Department of Defense’s Small Business Innovation Research program equates to over $1 billion in research funds—with more than half of the contracts presented to companies with fewer than 25 people, a third of the contracts to businesses with fewer than 10, and a fifth to women- or minority-owned firms. In the past, around a quarter of the businesses awarded with contracts are first-time winners.

For a full discussion of the Small Business Innovation Research Program, please click here.

The Small Business Technology Transfer Program

In 1992 the U.S. Congress enacted the Small Business Technology Transfer (STTR) program. Similarly structured with the SBIR, the STTR finances and supports cooperative research and development programs with small businesses in association with non-profit research organizations (including but not limited to universities, colleges, etc.) to expand their research to the marketplace. As with the SBIR, the STTR is likewise authorized up until September 20, 2017 for those federal agencies with external research budgets of over $1 billion.

Here is a more comprehensive overview of the government’s Small Business Technology Transfer program.

The Three Phases of the SBIR/STTR Programs

The SBIR/STTR Programs are organized in three phases:

1. Phase 1 is the project feasibility phase wherein the commercial, scientific, and technical merits as well as feasibility of ideas submitted are determined and enumerated.
2. Phase 2 is the project development to prototype phase where the major research and development strategies are established, prototyping are funded, and the most promising phase 1 projects are demonstrated.
3. Phase 3 is the commercialization phase, which is the final and ultimate objective of every SBIR/STTR program.  The law requires that phase 3 efforts should be funded by external SBIR/STTR sources.

Read more about the SBIR and STTR programs here and see if your business is eligible to participate in them.

A Little Help from StateAndFederalBids

Every business day at 5 p.m., around $6.5 million worth of contracts from the Department of Defense are announced. The department has established an organized archiving system for old announcements on these contracts, which can be found here. To be a successful awardee and be added to this list, you need to initially learn about these opportunities and prepare a bid based on the government agency’s specifications.

StateAndFederalBids is still second to none when it comes to purposefully gathering, sorting, and monitoring these bids to provide promising solutions for small firms and organizations considering to sign contracts and to establish business relations with the Department of Defense.

Click here to learn more about how StateAndFederalBids.com can help you identify Defense bid opportunities suitable for your business.