Finding Opportunities and Providing Services to the Federal Government
Knowing how to start selling digital services to the federal government can be a daunting task for even the most seasoned business owner.
This guide is intended to walk through some of the initial processes required in an effort to reduce the time it takes to bring innovative digital service companies into the government marketplace.
How to register as a small business
Register for a Data Universal Number System, or as its more commonly known as, D-U-N-S number
10 minutes // 1-2 business days to approve // free
A D-U-N-S number, issued by Dun & Bradstreet, is a unique code is used to identify your business and establish your business credit file.
Identify the classification of your products and services
As part of the federal registration process, you will also need to know where your products or services classify under the North American Industry Classification System (NAICS) code for administrative, contracting and tax purposes. You can search for your NAICS code using keywords which best describe your business. The Small Business Administration uses NAICS as the basis for its size standards and all procurements utilize NAICS codes to describe the principle purpose for the acquisition.
Common NAICS codes for digital services include:
- 511210 Software publishers (sometimes used for SaSS solutions)
- 541511 Computer software programming services, custom
Register your business with the System of Award Management (SAM)
1 hour // 4 days or less to approve // free
Pre-requisites: D-U-N-S number; Tax ID number (TIN), NAICS Code(s)
SAM is the system of record for vendors doing business with the federal government. Using SAM you can self-certify your business' size and socio-economic status.
Instructional video on how to register: https://www.youtube.com/watch?v=9VPGVYPvch4
SAM is also a marketing tool for businesses which allows government agencies and contractors to search for your company based on your ability, size, location, experience, ownership and more.
Qualifying for contracting opportunities set aside for small businesses
The federal government spends approximately $500 billion in contracts every year and the current law requires that 23 percent of these dollars be awarded to small businesses.
To qualify as a "small business" you must be a for-profit business and fall below the maximum size determined by your company's NAICS code based on average annual revenue.
- 511210 Software publishers - $38.5M maximum / annually
- 541511 Computer software programming services - $27.5M maximum / annually
Additional sub-classifications for small businesses
Companies with certain designations may also qualify for sub-classifications, such women-owned small businesses, small disadvantaged businesses, firms located in HUBZones (historically underutilized locations) and service disabled veteran-owned small businesses. You can learn more about these at the Small Business Administration.
Women-owned small businesses can determine eligibility and register at http://Certify.sba.gov/
Businesses interested in pursuing federal contracts have many options available to represent their company to potential government buyers, research opportunities available in the federal marketplace, and to understand the competition. These listed below are not the exhaustive list, but demonstrate a variety of ways in which the government seeks out business opportunities.
Pre-requisite: SAM Registration
The primary location for contractors to discover Federal business opportunities is at FedBizOpps (FBO). Federal agencies are required to use this site to communicate available procurement opportunities and their vendor requirements to the public and interested potential vendors for all contracts valued over $25,000. It is also the location where the government will release market research requests, such as Requests for Information (RFIs) or Sources Sought notices.
FBO allows you to search these opportunities or notices by NAICS codes, keywords, agencies, place of performance, set-aside type and more.
Dynamic Small Business Search
Pre-requisite: SAM Registration, Small Business Classification
DSBS is a tool contracting officers use to identify potential small businesses for upcoming contracting opportunities. Businesses can also use DSBS to identify other vendors for joint ventures and teaming, a common strategy for vendors new to providing digital services.
Pre-requisites: Typically none, determined by challenge rules
Challenge.gov is a listing of challenge and prize competitions, all of which are run by more than 80 agencies across federal government. These include technical, scientific, ideation, and creative competitions where the U.S. government seeks innovative solutions from the public, bringing the best ideas and talent together to solve mission-centric problems. Depending on the type of challenge, there is no prior registration with the federal government required as prizes can be won by individuals, teams, or companies.
Pre-requisites: SAM Registration, Ability to Accept Federal Purchase Card transactions
Agencies have the authority to make direct purchases without requiring competition for orders less than $3500 as a means of administrative convenience. These requirements are not typically posted and are usually initiated by the agency needing a particular good or service.
In order to facilitate the use of micro-purchases for open source coding services, the new Micro-purchase Marketplace is the place to bid on discreet open-source issues that are under the $3500 "micro-purchase" authority. This effort is being piloted by 18F.
Contracting officials use procedures outlined in the Federal Acquisition Regulation, known as the FAR, to guide government purchases. A "contract vehicle" is a broad term to define a method under which a company may pursue and close a sale. One of the most common contracting methods used by the government is consolidated purchasing programs including GSA schedules, Government Wide Acquisition Contracts (GWACs) and other multiple award vehicles. These vehicles offer government buyers a qualified pool of vendors with pre-negotiated rates for products and services sold to the federal government.
GSA IT Schedule 70
Schedule 70 is among the most widely used acquisition vehicles in the government for information technology purchases, and is the largest GSA Schedule in terms of number of contract-holders and sales.
Schedule 70 Overview http://www.gsa.gov/portal/category/100519
Plain-Language Guide to Schedule 70 http://www.gsa.gov/portal/category/100406
IT Schedule 70 Startup Springboard http://www.gsa.gov/portal/content/125886
GSA Schedule 70 FASt Lane
The FASt Lane program is designed for government agencies to have quicker access to emerging technologies and innovative suppliers. Using the GSA FASt Track program, a Schedule 70 application can be awarded in 30-45 days.
Understanding the Market
What the government intends to buy and how much it has to spend is all in the public domain. Understanding the budgetary priorities of agencies can help a savvy small business identify opportunities and focus their sales and marketing strategy.
Federal Procurement Data System
The Federal Procurement Data System (FPDS) is the repository of all federal contracting data for contracts in excess of $3500. With this system, you can learn about federal contracting opportunities as well as which agencies have contracts, what agencies buy, and which vendors have contracts.
USASpending.gov is a searchable database that contains information for each federal award including names of business, amount received and the funding agency.
Many federal agencies have what is known as an Office of Small and Disadvantaged Business Utilization (OSDBU) or an Office of Small Business Programs (OSBP). These offices work within their agencies to identify opportunities to incorporate small businesses as vendors to their agencies Each OSDBU holds trainings and events to help small businesses identify if there are opportunities with the agency.
Find Teaming Partners
Finding partners who already hold a prime contracts is a common way for new companies to enter government contracting. By teaming with established partners you increase your competitive advantage, performance capabilities, government relationships, and add invaluable experience. Many of the tools highlighted here, such as dsbs.sba.gov, fbo.gov and usaspending.gov can be used to identify companies who have recently been awarded new government contracts.
Small Business Administration
Federal Agency Acquisition and Procurement Links
Digital Services Playbook
United States Digital Service