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Tag: Department of Defense

So You Want To Be A Federal Government Contractor

A recent American Express OPEN survey showed that 57 percent of businesses noted a significant increase in revenue when engaged in government contracting. In fact, those businesses saw their revenue grow at a rate of 61percent. Our focus will be on the largest source of doing business with the government, federal government contracting. (The National Law Review May 9, 2022)

Each year the federal government contract spending is in the billions of dollars. The United States government is the single largest procurer of goods and services in the world. Vendors sell anything from paper clips to fighter jets for the Department of Defense. In order to take advantage of this business, at any level, vendors must complete several required steps. (ibid)

Completion of Regulatory Basics

Businesses wishing to work with the federal government must complete specific regulatory requirements. All potential contractors are required to obtain a Unique Entity Identifier (UEI). Your business is assigned a UEI when you register on SAM.gov. Click here to learn more about obtaining a UEI. (ibid)

For a contract to be awarded by the federal government, approval must be obtained by a Contracting Officer (CO). COs only approve responsible contractors. The government will not enter into a contract with a vendor who:

  • owes back taxes
  • has a current or pending legal judgment with the government
  • does not have a checking account
  • is on the government’s excluded parties list
  • has not completed the basic regulatory requirement for doing business with the government

Before moving on, potential contractors should verify all required registrations are completed and a UEI is assigned. (ibid)

Locating Opportunities

Looking for opportunities within the federal government is similar to private industry. One must determine which agency has a need for a particular good or service.

There are many sources to help locate opportunities suited to a specific business. The main portals for entry into the federal government contracting are:

General Services Administration (GSA) Schedule

This is the most common form of a federal government contract. GSA is the “acquisition arm” of the federal government. Vendors who wish to be included on the primary contract vehicle, a GSA Schedule, can find additional information here. (ibid)

To be eligible for a GSA Schedule contract, a potential GSA vendor must show proof of at least two years of measurable past performance and provide two years of financial statements. References from the Federal arena may be used in lieu of experience. (ibid)

FedBizOpps

Federal Business Opportunities (FedBizOpps) contains government contracting opportunities with values over $25,000. (ibid)

GWACs

This is a government-wide acquisition contract (GWAC) in which multiple government agencies align their needs and purchase a contract for goods or services. Government-wide acquisition contracts (GWACs) allow for economies of scale, which usually reduce per-unit costs.

Vendors may also act as a subcontractor to prime contractors. There are several sites to research for subcontracting opportunities. GSA and the Small Business Administration (SBA) both maintain subcontracting databases. Additionally, the SAM website, as well as the Federal Procurement Data System (FPDS), contain sources of information including trade and business publications.

There are two types of government contract offers – bids and proposals. Bids are made in sealed bidding purchases, proposals generally involve contract awards following a negotiation process. The three offer types are:

  • Request for Quotation (RFQ): Used for proposed contracts with a value of less than $150,000.
  • Request for Proposal (RFP): Used for acquisitions with higher values than an RFQ.
  • Invitation for Bid (IFB): Similar to an RFP, with values over $100,000. Contractors submit a sealed bid for government procurement. Generally, negotiation follows. (ibid)

It is extremely important that all information provided in an offer be factually sound and contain all information necessary for a CO to make an evaluation. Vendors should note that responses to technical specifications will become part of the contract, so it is wise not to overpromise. (ibid)

Once all requirements are satisfied the offer is ready for submission. Note, that the lowest-priced offer does not necessarily ensure a win. More often than not, experience and service excellence are deemed more important. (ibid)

The evaluation of offers begins when the government agency receives es the bids. Patience is key as acceptance of bids can take up to several months. The key is knowing and staying up-to-date with your Contracting Officer. (ibid)

Have questions about contracting with the federal government? Give us a call.

The Department of Defense is making Small Business their business

The Federal Register recently posted a request for comments which stated, “The participation of dynamic, resilient, and innovative small businesses in the defense industrial base is critical to the United States’ efforts to maintain its technological superiority, military readiness, and warfighting advantage. The department seeks public input on the barriers that small businesses face in working with the department. This input will be used to update the department’s Small Business Strategy led by the Department of Defense (DoD) Office of Small Business Programs.” (Nextgov September 15, 2021)

DoD is looking to reinforce President Biden’s executive orders supporting underserved communities while promoting American competition. Some specific areas of exploration are:

  • What regulations or business practices hinder the relationship between small businesses and the government?
  • How do the department’s initiatives (The Mentor-Protege Program, Indian Incentive Program, Procurement Technical Assistance Centers, the Rapid Innovation Fund, Small business Innovation Research and Small Business Technology Transfer), support or impact small businesses?
  • How do contracting timelines impact small businesses?
  •  Are skilled workforces attainable to “sustain a competitive small business ecosystem?”
  • How the coronavirus pandemic has impacted small businesses in the defense industrial base. (ibid)

At a recent Pennsylvania Showcase on Commerce, Defense Deputy Secretary Kathleen Hicks said, “over the past decade, small businesses in the defense industrial base shrunk by over 40%. The data shows that if we continue along the same trend, we could lose an additional 15,000 suppliers over the next 10 years.” She noted that the department is committed to making it more straightforward for small businesses to win contracts and referenced the Request for Comments notice in the Federal Register.

President Biden is “committed to nurturing small businesses that have faced historic barriers in rural and urban America, including businesses owned by veterans, women, and people of color-especially Black, Latino and Asian American businesses.” President Biden’s goal is to double the number of federal contracts awarded to small and disadvantaged businesses, in the next few years.

The Department of Defense is looking for input by October 25, 2021, to their Request for Comments. If you have questions about the RFC or are looking to work with the DoD or other government agency, give us a call.

 

 

DOD requesting IT budget boost

Data Science company Govini, recently reported the Department of Defense requested a 7.8% increase in its fiscal 2022 budget for IT. The request is mostly from the “general IT” spending subcategory. This brings the total sought to $34.8 billion for IT. (Fedscoop July 8, 2021)

Congress needs to approve the requested budget before it moves to DOD, however, it is a good indication of where the money will go, once approved. The IT and Command, Control, Communications, Computers, Intelligence Surveillance, and Reconnaissance (C4ISR) budget breakdown are as follows:

  • Naval Tactical Communications increase 2.8% to $2.6 billion
  • Medical IT increase by 6.9% or $2.2 billion
  • Other increase by 12.5% to $18 billion (ibid)

The budget increases consistently trend upward from the previous year indicating the importance of IT in war. Bob Work, former deputy secretary of defense in the Obama administration said, “the future character of warfare will be defined more by information than by hardware.” (ibid)

Looking to provide IT services to DOD? Give us a call.

 

 

What the new Minimum Wage Executive Order means

In late April, President Biden signed an executive order, requiring government contractors to increase the minimum wage to $15 per hour by 2022. Censeo Consulting Group analyzed the effect of the federal worker minimum wage increase. They determined that approximately 30,520 contracts will require modification. In addition, they expect the modifications to add 450,000 additional contracting office, workload hours. This equates to about 240 additional full-time positions. (ExecutiveGov May 27, 2021)

The executive order will impact federal spending from between $1 and $2 billion. Agencies can prepare by:

  • Segmenting contract portfolio by delivery location and spend category, highlighting impacted contracts
  • Developing a policy and process for addressing impacted contracts
  • Analyze internal pricing to identify contracts requiring modifications (ibid)

The departments of Veterans Affairs, Defense, Agriculture, and State are most impacted by the executive order and are likely preparing to make their contract modifications on or before the 2022 deadline.

Do you need to modify your contract? Give us a call.

 

Procurement vs. Purchase

If we can be certain of one thing, it is that the pandemic wreaked havoc on many businesses and their business models. We tend to see government procurement growth during times of crisis. Once the media blasted us with headlines of medical device and personal protective equipment shortages, procurement officials found themselves in a precarious position. How to get supplies and get them fast.

Rick Grimm, chief executive officer of NIGP, the Institute of Public Procurement worries that procurements may slow down, now that shortages are being met. According to a brief from NIGP, “when skilled, professional procurement is buried within an organization and disconnected from the decision-making process, key business opportunities efficiencies and full value for money may be lost.” (Route Fifty May 7, 2021)

We witness the word “purchasing”  being substituted for the more comprehensive term “procurement.” Many believe this field should cover a broad scope of activities such as developing suppliers, strategizing to enhance supplier relationships, actively managing acquisitions and supervising contracts, and evaluating supplier performance. (ibid)

State governments made great inroads with suppliers during the pandemic. Many incentivized the private sector. In Maryland, where weapons systems are made for the Department of Defense, producers pivoted to make ventilators. Hand sanitizers were also retooled and made locally. (ibid)

The challenge to governments was understanding how vendors could best be utilized. There was no way to work with overseas manufacturers. Local product lines were evaluated and swiftly shifted. (ibid)

What does the future hold? Hopefully, the speed of procurement progress over the past year will not be in vain. Grim stated, “leveraging the value of procurement in achieving the government’s mission, helps you achieve those goals and becomes procurement’s mission as well. The big challenge, still, is getting the bosses of procurement to understand its strategic value.”(ibid)

Ready to get into federal procurement? Give us a call.