SmallBizLady: Is now a good time for small businesses to do business with Government Agencies?
Carroll Bernard: Absolutely! In fact, the government market is a great place to look for opportunities at any time, but even more so during a recession. When the economy is not doing well, the government increases its spending to help stimulate economic activity, stabilize businesses, and create and retain jobs.
In the last great recession that began in 2007, President Obama signed into law the American Recovery and Reinvestment Act (ARRA) of 2009, which ultimately provided over $800 billion in stimulus funds. When a portion of those funds began hitting the contracting offices, I watched how incumbent small business contractors became overwhelmed with opportunities. We were pushing out so many projects that the contractors who frequently did business with the VA through one of our IDIQ contracts stopped bidding on contracts because they were all tapped out. So here we are again, facing another recession – this time due to COVID-19. The federal government has already rolled out multiple stimulus packages and increased buying activity to fight this pandemic, but we’re not done yet. I’ve been paying close attention to the discussions concerning another infrastructure spending bill. Just last week, there was a proposed $494 billion stimulus bill targeting infrastructure. I don’t believe there has ever been an infrastructure bill of this magnitude. If you look at all of the spendings within ARRA, infrastructure projects accounted for $85 billion (approximately 10% of total ARRA spend).
Get involved NOW! Don’t wait until you see the money flowing before you get your boat in the water because there is another part of the story I have not mentioned.
SmallBizLady: What is the danger of people waiting to pursue government contracts?
Carroll Bernard: Back in 2010, while ARRA spending was still in full swing, I transitioned to the U.S. Small Business Administration. At the SBA, my role was to support small businesses who wanted to get involved with federal contracting. People were flocking in because they saw how much the government was spending while most of their commercial work dried up. They were hoping that government contracts would save their business, but in many cases, they were too late to get involved. It was sad to see small businesses going bankrupt and their owners losing their entire family savings.
Ever since I’ve been preaching to small businesses to get involved in the government market. Not only does the government market offer a unique opportunity to grow through small business set-aside contracts, but it also provides a way for small businesses to sustain and even flourish during downtimes.
SmallBizLady: Can a small business of any size sell to the government?
Carroll Bernard: Yes!!! There is a big misconception that businesses have to be a certain size and have several years behind them before they can sell to government agencies. While that can be a requirement under some government contracts, it is not the case for many government buys. I’ve worked with businesses of all sizes. For example, the owners of one firm I assisted were living on unemployment when they launched their business, but they went on to win millions of dollars within just a couple of years.
SmallBizLady: How can small businesses who want to get involved in the government market get started?
Carroll Bernard: This is one of the big challenges small businesses face right out of the gate because much of the information out there is misleading, inaccurate, and comes in the form of a “one-size-fits-all” answer. Even well-meaning government websites offer a “one-size-fits-all” pathway, which usually involves:
- Get registered in SAM
- Watch for opportunities published on beta.sam.gov, and
- Get a GSA Contract.
The problem is, this general approach may work for some small businesses but not others. When businesses look for opportunities only on beta.sam.gov, they are missing out BIG TIME because the majority of individual purchases never get posted there at all. The first thing I would recommend to anyone considering government contracting is to get some basic understanding of how the government market works BEFORE jumping in full force. As exciting as it may be, I would encourage anyone interested to grasp the big picture of the government market first to understand the buying hierarchy, processes, and contract vehicles the government uses to buy products and services similar to what their company sells. They should also be aware of common myths and misconceptions, and where to look outside of the standard places the government tells you to look. I cover all of this information in a free webinar I offer on Govology called, “Exploring the Government Marketplace For Your Small Business” (https://govology.com/explore). Once a small business understands the big picture of the federal market, they can craft their roadmap and know precisely where to look for the type of opportunities they want to pursue. Sometimes it’s not even a matter of where you look, but who you know, and who knows you. By following the approach that’s right for them, businesses will feel more confident and adept at navigating the government market. Some businesses may be able to use their proven sales process outside of the government market to sell their products to the government. Others will have to adapt their existing process, and perhaps even their products or services to match the government’s standards.
This was a great interview, hopefully, you can pivot and take advantage of a government contracting opportunity.
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