Originally published on LinkedIn by OSD CEO and Executive Director, Glenn D. Banton, Sr.
Government contracts offer a tremendous financial opportunity for veteran-owned small businesses. The U.S. government is the largest customer in the world – it buys all types of products and services and it’s required by law to consider buying from small businesses.
Selling to the government can provide your veteran-owned small business with a new channel of revenue but government contracting can be complex and it’s important to learn how to best position your business in the federal marketplace. So where should you start?
The ABCs of Government Contracting
First, let’s discuss the basics. Government contracting is the process of selling your goods or services to and for use by the government. The process generally starts with procurement, where an agency defines their requirements and determines the best method for purchasing services. Once the requirements are defined and the agency has determined which company to outsource its needs, acquisition begins, once you’ve already won an agency contract.
What are they? Do I need to be certified? The first thing to know is that the government must adhere to certain set-aside guidelines – meaning there’s a certain percentage of business set aside for different types of companies. Although small business certification is not necessary for day-to-day operations, it is highly recommended if you are planning to sell goods or provide services to the government.
Veteran small business owners should consider the following certifications:
- 8(a) Business Development Program
- Company must be 51% owned/controlled by a socially and economically disadvantaged individual or group of individuals
- Certain presumed groups include African Americans, Hispanic Americans, Asian Pacific Americans, and Subcontinent Asian Americans
- Service-Disabled Veteran-Owned Small Business (SDVOSB)
- Company must be at least 51% owned, operated, and controlled by one or more veterans with a service-connected disability. Learn more here.
The federal government’s goal is to award at least 3% of all contracting—and 3% of subcontracting—dollars to SDVOSBs each year. In 2018, the federal government exceeded this goal, awarding 4.27% in contracting dollars!
- Veteran-Owned Small Business (VOSB)
- Company must be at least 51% owned/controlled by U.S. citizens who are veterans of the U.S. Armed Forces
To learn more about government contracting certifications, visit certify.sba.gov.
Preparing for Government Contracting
You’ve made the decision to pursue government contracting. Now what?
Tap into the following tools to prepare your business to compete in the federal marketplace:
The Veteran Federal Procurement Entrepreneurship Training Program (VFPETP) equips veteran business owners with the knowledge and skills required to successfully enter and compete for government contracts. The program is delivered by the Veteran Institute for Procurement (VIP) and provides three different courses depending on where you are in your contracting journey:
- VIP START: designed for veteran-owned businesses that want to enter or expand their business growth into the federal marketplace
- VIP GROW: designed for veteran-owned businesses to increase their ability to win government contracts by establishing best business practices
- VIP INTERNATIONAL: designed for veteran-owned small businesses that want to enter and/or expand their federal and commercial contracting opportunities overseas
Set up a meeting with a local SBA District Office or SBA Resource Partner—including Veterans Business Outreach Centers (VBOCs), SCORE, Small Business Development Centers (SBDCs), and Women’s Business Centers (WBCs) to chat with an experienced adviser who can guide you through either the contracting or certification process. Find local assistance here.
The SBA’s online tools, such as the Government Contracting Classroom, provide you with a basic understanding of the federal marketplace and how you can start to position your business to compete for contracts. To learn more about SBA’s online tools and resources, visit the SBA Learning Center.
The SBA provides surety bonds for certain surety companies and covers the different types, including bid, payment, performance, and ancillary. Surety bonds help small businesses win contracts by providing the customer with a guarantee that the work will be completed.
If you’re a current veteran business owner looking to explore the federal marketplace, learn about your options through SBA’s contracting website or the Veteran Institute for Procurement. To learn more about other resources available for veteran, service member, National Guard or Reserve, and military spouse entrepreneurs, visit sba.gov/veterans.