Contrary to what you might have heard, federal government construction jobs can be fairly lucrative for contractors and subcontractors. And with the upcoming passing of new federal infrastructure funding, lots of federal projects will be coming down the pipeline soon. It pays to be ready to bid on these projects when they come to your neighborhood.
What are government contracts?
A government contract is an agreement to provide products or services to the US government or one of its branches. The federal government enters into thousands of contracts each year for both small and large projects. Contractors are hired through an online bidding process.
How to register as a contractor for the federal government
The first step in registering as a contractor for the federal government is to get a Data Universal Numbering System (DUNS) number. A DUNS number is a unique nine-digit number for each physical location of your business that is issued by Dun & Bradstreet. The number is used to track your success on contracts and your creditworthiness.
Next, you must register your business with the System for Award Management database at SAM.gov. You must register in order to be awarded a government contract. You can even have contracts given to you simply by being listed, as federal agencies often use the database to find businesses that meet their needs.
In order to register at SAM.gov, you will need to know your North American Industry Classification System (NAICS) code(s). This code (or codes) describes the products, services, or industries that you furnish. You may also want to list your Standard Industrial Classification or SIC code on your registration. Including these codes helps agencies find your business when they are looking for the products or services you supply.
If you’d like to work with the General Services Administration — which offers a wide variety of lucrative contracts — you’ll need a past performance evaluation. You apply for the evaluation online and will be subjected to an independent audit of your customer references. The audit rates your past performance based on a statistical analysis of performance data and survey responses.
Where to find government construction projects
Federal contract opportunities are listed on the SAM.gov site under Contract Opportunities. You can search by NAICS code or by location for projects that fit your profile.
Subcontractors looking to partner with general contractors on federal projects can visit the Small Business Association’s (SBA) SubNet site. On the site, you can search for subcontracting opportunities by location.
How the contract bidding process works
Prime contractors and subcontractors can search the previously mentioned directories for contract opportunities that match their capabilities and place bids on the contracts.
Follow the instructions on the requests for proposal and be sure to include all the information requested by the hiring agency. Then, calculate your bid price and include any costs you’ll incur to perform the work, as well as profit.
Dive deeper – RFI vs RFP: Understanding the difference in construction
Once you’ve signed a government contract, you’ll be expected to complete the contracted work for the bid price, so make sure you can complete the work profitably.
Requirements before bidding on federal construction contracts
The only blanket requirement for bidding on federal projects is registering with SAM.gov. However, specific projects may require certain documents or certifications prior to bidding.
Be sure to read the RFPs closely before deciding if you’re going to bid on a project or not.
How to increase your chances of winning a federal construction contract
Now that you know the basics of the federal bidding process, here are four easy tips to help you ensure your bids are successful.
1. Be prepared
Make sure you are fully prepared to take on government work before you bid a project. There are additional labor laws and rules you must follow when working with the federal government.
Also, make sure you have enough labor and equipment to handle the added workload. Look to materials financing and equipment financing if you need immediate help.
2. Know and follow the rules
Read each RFP closely and provide the information requested and in the format required. Unlike other private bidding opportunities, the federal government is a stickler for following the rules.
3. Determine whether you qualify for special labels or programs
Federal and state governments are required to award certain percentages of work to minority-owned, small, or disadvantaged businesses. If your company qualifies, it pays to go through the process of registering through one of these programs.
4. Always keep actively searching for opportunities
SAM may be where all contract opportunities are listed — but don’t forget to look elsewhere.
One thing you can do is to scour local news and announcements. For example, your city could post a bid for design services for a new local government building. Knowing about this early means you can prepare your bid for it ahead of time.
Register your company now and get all your information together in preparation for federal projects. Some contractors only work on these types of projects, so they can definitely work for you. The key is to be prepared and follow the RFP instructions correctly.
Be the low bidder, and you’re on your way!