Become a Federal Contractor and Have the World's Fortune One Company as a Client

By Gloria Berthold



Why would anyone want to go through all the hurdles required to sell anything to the behemoth organization known as the federal government? The quick answer is that government entities buy more products and services than any other individual customer anywhere in the world. And they buy virtually every product or service you can imagine.

If you want to be a successful entrepreneur, you want to find people who are conveniently located and who will buy what you sell. You want to find people who buy repeatedly from you. You want to find people who will refer you to others. And finally, you want your customers to pay you on time. The U.S. federal government is referred to as the world's Fortune One customer, because it not only spends more than $400 billion a year with businesses of all kinds, it also fulfills all of those attributes.



Quite a Customer

According to the USASpending.gov web site, the state of Maryland ranks fifth of all states in total federal contract spending. In the last fiscal year (2007), more than $19 billion (of the total $400 billion spent) went specifically to Maryland businesses.

More than $1.7 billion in information and telecommunication services were purchased from Maryland-based companies, $1.03 billion in engineering and technical services, $955 million in other professional services and $820 million in systems engineering services. Dairy, food and eggs were the top products sold at $739 million.

However, of the more than 240,000 businesses based in Maryland, fewer than 19,800 are registered as government contractors with the Central Contractor Registry (CCR).

As more entrepreneurs are becoming aware of such an active, responsive and potentially profitable market, they can see it can be a natural fit.

Once you are successful selling your product or service the first time, there is an excellent chance that you will sell more products and services to that entity again, and to other offices within the same agency. If your products or services perform as promised, you will often find that you have a built-in referral base. And payment is guaranteed, as long as you read the fine print and are prepared to follow the rules.



You Must Register to Win

"Government contractor" is a catch-all term that covers all businesses or individuals who sell any product or service to any government entity, whether it is at the federal, state, county or local level. A contractor may have thousands of employees or may be a company of one.

The federal government is very serious about giving small businesses the opportunity to be competitive in winning contracts. Of the $340 billion in eligible contracts in 2006, 22%, or $77 billion, actually went to small businesses. The Small Business Administration (SBA) has set specific goals for subsets of small business to help build strength in economically disadvantaged areas, within certain geographic areas and also within certain segments of the population.

You can immediately open the door to becoming a federal government contractor by registering with the Central Contractor Registry (CCR). There is no fee to register, and you are guided through the process when you visit the CCR web site, www.ccr.gov (see sidebar for more details).

Becoming a successful government contractor presents a few challenges for entrepreneurs. The free-wheeling, problem-solving, can-do spirit inherent in most entrepreneurs can be stifled by the voluminous rules and regulations that one must follow. The long decision-making cycle is usually a rude awakening and can result in costly overhead problems requiring additional capital to fund ongoing business needs until the contracts start coming in.



Entrepreneurs as Government Contractors

If there is one trait common to successful entrepreneurs, it is reacting quickly to adversity. This will serve you well in your bid to learn about government contracting. Where less resourceful people would see hurdles, you see challenges. When they hear a new "language" full of unusual acronyms and terms, you create your own glossary and cheat sheet to get you through agency meetings. When they face brick walls and blind alleys, you rely on your network to find a way to the real decision makers.

Truly successful business people also realize that they must surround themselves with people who are smarter than they are. While a normal tendency for an entrepreneur is to be a "do-it-yourselfer," it is imperative that you surround yourself with people who know more than you do about the legal aspects of government contracting, the special accounting requirements, the unique business development processes and how to write winning proposals and negotiate a successful contract.

You have many resources available to you for help in all aspects of developing your government contracting business. The Small Business Administration (SBA) provides assistance through a comprehensive web site (www.sba.gov) and personal counseling. The Procurement Technical Assistance Centers (PTAC) are federally funded offices whose mission is to help you navigate the federal contracting maze (www.aptac-us.org). Locally, the Howard County Economic Development Authority has classes and seminars to help you start a business, enter government contracting and even get certified. You could not ask for a better time to open the door and explore your opportunities as a government contractor.





Steps to Register as a Federal Government Contractor



Step 1: Obtain a D-U-N-S number from Dunn & Bradstreet. This is a nine-digit business identification number that is used much like a person uses a social security number. If you do not have a D-U-N-S number, contact Dunn and Bradstreet to obtain one at www.dnb.com. There is no charge for assigning a D-U-N-S number for a government contractor and you must have one to proceed.

Step 2: Find your product or service NAICS code(s). This is the numerical code that the U.S. government uses to describe the products and services it buys. Go to: www.census.gov/epcd/www/naics.html.

Step 3: Register in the Centralized Contractor Registration (CCR) system. You must be registered in CCR to be awarded a contract from any federal civilian or military agency. CCR is a federal database designed to hold information relevant to procurement and financial transactions. Visit: www.ccr.gov.

Note: State and local governments have their own individual registration process.







Gloria Berthold is president of TargetGov, author of "The Veterans Business Guide" and a federal business development expert. She can be reached through www.TargetGov.com.