How To Find the Right Partner When Selling to the Federal Government

Each year, the U.S. government spends billions of dollars on products and services ranging from pencils to human resource consulting. Working with the federal government–the world’s largest customer–can be a profitable endeavor for any business. According to USASpending.gov, in FY16 alone, the federal government awarded roughly $473.8 billion in contracts. While working with the government can be a strategic growth opportunity, there can be a learning curve. Because of this, many firms decide not to jump in alone.

One strategy that many successful small business owners employ in government contracting is teaming with other companies—large and small—to compete for contracts together. If you are new to government contracting, teaming can be a great way to gain experience and credibility, which will hopefully help your chances to win future contracts. And as you gain experience, partners can help you secure larger contracts that can boost your bottom line.

Does Teaming Make Sense for Your Business?

Teaming is a good idea when a contract requires a larger workforce or a higher volume of work or products than any one business can produce alone. There are a few different types of teaming strategies. Small businesses can partner with other small firms that offer complementary products or services to compete for contracts that they may not be eligible for individually. Another teaming arrangement is for small businesses to subcontract, or to work with a large contract-holder, also known as a prime, to fulfill part of their larger contract.

Many businesses have found that partnering with other companies to jointly bid on federal contracts can be a great way to get their foot in the door and gain experience. In addition, teaming arrangements can sometimes result in landing larger contracts that a business may not be eligible for on its own. Over the last three years, two-thirds of subcontracting bids from small business contractors have yielded contracts and according to the latest American Express OPEN Trends in Federal Contracting for Small Businesses, and 38% of survey respondents said that it’s getting easier to win contracts because they have established good teaming and subcontracting partnerships.

When partnering with large, experienced companies, you can not only boost your company’s chance of success but you can also tap into a valuable mentorship opportunities. These larger businesses can help your company navigate the federal marketplace, gain experience and set you up for future success.

How to Know If a Teaming Relationship is a Good Fit

The key to successful teaming partnerships is to find a partner that is an extension of your company in integrity and quality. Identifying a business that offers complementary products or

services will be beneficial to the both of you. For example, certified firms that have a successful track record may be good teaming partners, so if a contract is set aside for a Women-Owned Small Business, HUBZone firm (Historically Underutilized Business) or Service-Disabled Veteran-Owned Small Business, don’t throw in the towel, team with one!

Check out potential partners on the Federal Procurement Data System and then do your research. Review the types of contracts these businesses have held and how many they have fulfilled.

Where to Find Teaming Partners

It is always wise to seek out potential partnerships in person when possible. Many business owners take strategic steps to lay the groundwork for alliances by attending conferences to build face-to-face relationships. Your company can leverage the countless networking events across the country where you will have the chance to speak first hand with prime contractors and other small businesses. Events such as those hosted by ChallengeHER, a program for women-owned small businesses looking to pursue federal contracting, offer an opportunity to make valuable connections and market your company.

If you aren’t available to network in person, another good option is doing research online. Online tools such as the System for Award Management and the (Dynamic Small Business Search (DSBS)) are a good place to start identifying companies for teaming opportunities.

A lot of small businesses have also had luck finding teaming partners through the Small Business Administration’s Mentor/Protégé program. The program is designed to enable successful firms to provide various forms of business development assistance to 8(a) BD Program Participants.

Think Big but Start Small

As with any relationship, only time can tell if a partnership is truly a good fit. Therefore, it may be helpful for you and your potential partner to work together on two or three smaller projects before pursuing larger contracts. By doing this, both parties learn about each other’s business structure and work habits. This will also help work out the kinks in the business relationship and develop procedures to ensure things run smoothly before taking on a large job.

While finding the right partner to begin your teaming journey takes time and resources, the search will be well worth your time. Teaming with another business is a great way to gain experience in government contracting and can open the doors to future business opportunities for your company.

Lourdes Martin-Rosa is the president of Government Business Solutions (GBS) and the American Express OPEN Advisor on Government Contracting. 

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