Contracting with Government
Discussion from the trenches
Cecelia McCloy, President
Integrated Science Solutions, Inc.
© ISSi
Who buys all these products or services?
• Cabinets
• Cattle
• Nuclear Engineering services
• Rocket propellant
• Processed cheese
• Containers
• Bricks
• Paper
• Microbiologic Services
April 2008
Alliance West
© ISSi
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Is the Federal Government a Customer for me?
The numbers are impressive
• 2006 - $300B in contracting
• 23% contracting goal to small businesses
• Goals for SDV; Minority; WOBs; Hubzone
• Services and Products bought are
extensive
• BUT -It is difficult to do business with the
federal government
April 2008
Alliance West
© ISSi
3
It Will Cost You to Play
• Marketing will take $$$ and time
• Identifying an opportunity to getting a contract
can be anywhere from 6 months to two years
• Start small – look at subcontracting opportunities
• Build your past performance
• Bidding can be expensive – Responding to a
Full Request for Proposal as prime bidder
• $25,000 to $55,000 (SB prime contracts)
• Many hours of work with a multiple volume set
• Need the right people to bid and to run the contract
• Need the right operational systems to perform
April 2008
Alliance West
© ISSi
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Plan
• Which agencies buy my services and/or
products?
• What are my services or products? Past Performance
• All agencies have public web pages, review them
• Some agencies have procurement forecasts
• All agencies require large business prime contractors to
have small business plans
• Is a GSA contract an option
• What should my win strategy be?
• Some agencies are friendlier to small businesses then
others – learn who they are
• Network, Network, Network
• Ask – Why would someone want to team with me?
April 2008
Alliance West
© ISSi
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Plan
• How to I find opportunities?
• Monitoring the Web
• www.Fedbizopps.gov
• Try a private government bid portal
• Work with the Small business
representatives from the agencies
• Attend Industry Days or Outreach Events
for Agencies
• Use the Small Business Administration
and affiliated organizations
April 2008
Alliance West
© ISSi
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Plan
• Identifying – Bidding – Winning
• Design your strategy to ensure a Win
• What is the true likelihood of a Win
• Is there an Incumbent? Is the agency happy
with them?
• What does it take to win? Best Value? Low
Price?
• Does this opportunity match my business?
• Should I team?
• Do I have a history with this customer? Do they
know me? Can I do all the work? Strategic
Partnering?
April 2008
Alliance West
© ISSi
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Downside to Working for the government
•
Bidding process is long and can be
complicated
•
•
There are lots of rules
•
•
•
•
April 2008
You may need to hire help!
Federal Acquisition Regulations (FARs)
There are implications for your business
processes (accounting, time charging,
benefits)
Maybe initial cash flow issues
Margins are not large on government
contracts – longevity vs. profits <10%
Alliance West
© ISSi
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Benefits of Federal Government Contracting
•Stabilize your Cash Flow
•Contracts are often of long duration
• 2 to 10 years not unusual
•Government Experience can raise the bar
on your company operations
•Hire key personnel
•Providing a needed service to your
community
April 2008
Alliance West
© ISSi
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ISSi story
• First federal contract $300,000 as a
subcontractor in March 1999
• First opportunity bid as major
subcontractor July 1999 and won but
delayed contract startup until Nov.
2000
• First win as prime contractor in March
2005 - Bid was in August 2004
• First invoice paid after initial 70 days
• Carried payroll of 22 staff on contract
April 2008
Alliance West
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ISSi story
Millions
ISSi Gross Revenue
12
10
8
6
Revenues
4
2
0
2000 2002 2004 2006
April 2008
Alliance West
2007
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Conclusion
• Know why you want to work for the
Federal Government or government
contractor
• Make sure you have identified a viable
bid opportunity
• Make sure your company can
withstand the cash flow issues
• Make sure you have the financial and
operational systems in place when you
win
• Don’t hold back - Win
April 2008
Alliance West
© ISSi
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