intro to gov contracting

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    Selling to the FederalGovernment

    Conrad Valle

    Assistant District Director

    SBA Michigan District(313) 226-6075, Ext. 254

    E-mail:[email protected]

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    The federal government purchases over 200billion dollars in goods and services each year

    that range from paperclips to complex spacevehicles.In FY 2006 over $415 billion was actually

    spent.2006 Michigan placed 43rd in contracts on aper capita basis

    2006 in Michigan by Place of Performance$5.3 Billion 25th Place Nationally

    2006 in Michigan by Contractor State

    $5.7 Billion 20th Place Nationally

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    Distribution of Contracts

    Sales to Governme nt

    Lar e >80%

    Large firms represent less than 5% of businesses.

    Large firms receive more than 80% of the

    procurement dollars.

    Total Large and Small Businesses

    Small 95%

    Large 5%

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    Federal Purchases by Category

    36% - Supplies and Equipment (Electronic,Transportation, Metal Products)

    35% - Services (Engineering, R&D Management,

    Business and Health)

    19% - Agriculture, Transportation,Communications, Utilities, Finance & Administration

    7% - Construction

    3% - Wholesale/Retail

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    SBA Government Contract

    Assistance Programs Federal Agency Contract Goal Program

    Prime Contract Program (PCRs)

    Size Program

    Small Business CategoriesSmall Business Categories Procurement Marketing (CCR & SUB-Net)

    Subcontract Program (CMRs) Certificate of Competency Program (COC)

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    The SBA is responsible to see that

    statutory government wide goals aremet in the aggregate

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    The statutory goals: 23 percent of all prime contracts for small businesses

    (SB)

    5 percent of prime and subcontracts for small

    disadvantaged businesses (SDB) 5 percent of prime and subcontracts for womanowned small businesses (WOB)

    3 percent of prime contracts for Historically

    Underutilized Business Zone small businesses(HUBZone SB)

    3 percent of prime and subcontracts for servicedisabled veteran-owned small businesses (SDVOSB)

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    Procurement CenterRepresentatives

    Counsel small businesses

    Review buying activitys SB programs

    Review Subcontracting Plans Recommend acquisitions for 8(a) program

    Train agency staff in SB programs

    Speak at procurement conferences

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    Procurement CenterRepresentative

    Where are PCRs Located? Federal Agencies and Buying Activities which do

    at least $500 Million in Procurements annually.

    Nationwide - 47 PCRs at 255 (out of 2,200) federal buying centers: awarded $120 Billion

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    Procurement CenterRepresentatives

    For Michigan

    US Army Tank-automotive and Armaments

    Command (TACOM) WarrenPamela Thompson

    e-mail: [email protected]

    Phone: (586) 574-8124

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    Only SBA determines size.

    A business entity organized for profit, with a

    place of business located in the United States,and which operates primarily within the UnitedStates or which makes a significant contribution

    to the U. S. economy through the payment oftaxes or use of American products, material orlabor (13 CFR Part 121)

    What DeterminesWhat Determinessmallsmall??(First Criteria)

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    North American Industry Classification

    System Code (NAICS Code)

    http://www.sba.gov/size/

    Manufacturers = Number Employee

    Services = Annual Gross Sales

    What DeterminesWhat Determinessmallsmall??(Second Criteria)

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    332 -- Fabricated Metal Product Manufacturing

    NAICS Description Size

    332116 Metal Stampings 500

    332813 Electroplating, Plating, Polishing,

    Anodizing, and Coloring 500

    332992 Small Arms AmmunitionManufacturing 1,000

    332993 Ammunition Manufacturing 1,500(except Small Arms)

    332994 Small Arms Manufacturing 1,000

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    5413 - Architectural, Engineering,

    and Related Services

    NAICS Description Size541330 Engineering Services $ 4.0M

    EXCEPT Military and Aerospace Equipment

    and Military Weapons $23.0M

    EXCEPT Contracts and Subcontracts forEngineering Services awarded under

    the National Energy Policy Act of 1992$23.0M

    EXCEPT Marine Engineering and NavalArchitecture $13.5M

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    Small Business CategoriesSmall Business Categories

    Small Business (SB)

    8(a) Certified Small Business

    HUB-Zone Small Business (HUB-Zone)

    Small Disadvantaged Business (SDB) Woman-Owned Small Business (WOSB)

    Service-Disabled Veteran-Owned Small

    Business/Veteran-Owned Small Business(SDVOSB/VOSB)

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    Federal Contracts Small Business (self-certify)

    Woman-owned Small Business (self-certify)

    Veteran-Owned Small Business (self-certify)

    Small Disadvantaged Business (pre-certification) 8(a) Program (pre-certification)

    HUBZone Small Business (pre-certification)

    Certification

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    WomanWoman--Owned Small BusinessOwned Small Business

    Small business concern, and

    At least 51 percent owned by one or morewomen, and

    Whose management and daily businessoperations are controlled by one or more

    women.

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    VeteranVeteran--Owned Small BusinessOwned Small Business

    & Service& Service--Disabled VOSBDisabled VOSB

    Small business concern, and

    At least 51 percent owned by one or more

    veterans/service-disabled veterans, and

    Whose management and daily businessoperations are controlled byveterans/service disabled veterans.

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    Set Aside Programs

    FOUR Set Aside categories: Small Business Set Asides (SBSA)

    SBA 8(a) Set Asides SBA Hubzone Set Asides

    SDVOSB Set Asides

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    Other Set Aside Programs

    Simplified acquisition - Procurements over$2500 and under $100,000.

    Reserved for Small Business

    Contracting Officer must justify if not set-aside

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    The Federalgovernment recognizes

    3 certifications involvingsmall businesses:

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    8(a) Small Disadvantaged

    Business CertificationHubZone Certification

    Small DisadvantagedBusiness (SDB) Certification

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    Requirements for 8(a)Certification: Small Business, U.S. Citizen, 51% owned & controlled by Socially &

    Economically DisadvantagedIndividuals

    Less than $250,000

    Personal Net Worth

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    Requirements for Certification by SBA

    1. Small Business Located in a HUBZonehttp://www.sba.gov/hubzone

    2. Owned & Controlled by U.S. Citizen/s

    3. At least 35% employees reside in a HUBZone

    4. Verified in www.ccr.gov, Dynamic Small BusinessSearch

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    Benefits Of HUBZone Program

    Sole Source Contracts (

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    Small Business, and U.S. Citizen, and 51% owned & controlled by Socially & Economically

    Disadvantaged Individuals, and Certified as SDB by SBA (Certification is good for 3years)

    8(a) firms are SDBs

    Less than $750,000 Personal Net Worth Verify on www.ccr.gov under Dynamic Small

    Business Search (DSBS)

    Small Disadvantaged Business

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    Get Your Foot in the Door

    Central Contractor Registration (CCR)

    http://www.ccr.gov/

    The U.S. Small Business Administration, theDepartment of Defense, the Office of Management

    and Budget and the General ServicesAdministration have taken steps to simplify thefederal contracting process by creating an

    integrated database of small businesses that wantto do business with the government.

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    Get Your Foot in the Door

    continued

    Certifications ORCAhttp://orca.bpn.gov

    Federal Technical Data Solutions(FedTeDS) website

    http://www.fedteds.gov

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    Where are the Bid

    Advertisements?

    Federal Contract Opportunities

    Government Procurement Search Engine (Vendor Notification Service)

    http://www.fbo.gov

    Agency Web Sites http://dodbusopps.com/

    http://www.gsa.gov http://prod.nais.nasa.gov/pub/fedproc/home.html

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    HOW THE GOVERNEMNTBUYS

    CONTRACTING METHODS

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    SIMPLIFIED PROCEDURES

    Federal Acquisition Streamlining Act

    (FASA) of 1994

    Procurements under $100,000 Over $25,000 still must use www.fbo.gov

    Over $2,500 but less than $100,000 reserved

    for small business UNDER $2,500 Government Credit Card

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    SEALED BIDDING Invitation For Bid (IFB)

    Buy is clear, accurate and complete

    Bids opened publicly at a specified

    time, read aloud and recorded

    Contract awarded to low bidder who is

    found to be responsive

    Used very little

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    CONTRACT NEGOTIATION

    Request For Proposal (RFP)

    Exceeds $100,000

    Specs not always exact

    Contractors submits proposal on how they plan to dothe work and at what price

    Proposals subject to negotiations

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    CONTRACT NEGOTIATION

    Request For Quotation (RFQ)

    Govt is looking into possibility of buying aproduct or service

    Not considered a binding contract

    Govt issues order based on the offer

    Becomes contract when supplier accepts

    order

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    CHANGES

    Best Value

    Not necessarily to lowest bidder Award goes to contractor that best satisfies

    govt needs

    Intent of Best Value must be stated in RFP

    Evaluation criteria in the RFP very important

    Past performance may also be a factor

    CONSOLIDATED PURCHASING

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    CONSOLIDATED PURCHASING

    PROGRAMS Acquisition Vehicles

    Multiple Award Contracts Long termvendor agreements with fewer vendors

    Multi-agency Contracts

    Government-Wide AcquisitionContracts (GWAC)

    Increase use of GSA Schedules Buyers issue orders against existing

    contracts/schedules

    CONSOLIDATED PURCHASING

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    CONSOLIDATED PURCHASING

    PROGRAMS(continued)

    Agencies that use these programs the most

    General Services Administration (GSA)

    Defense Logistics Agency (DLA)

    Department of Veterans Affairs (VA)

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    5

    Federal Supply ServiceFederal Supply Service Multiple Award Schedules.

    Schedules = Categorized lists of similarproduct/services and suppliers.

    Multiple Award Schedule = Governmentawards contracts to various suppliers

    offering similar products/services atvarying pre-approved prices.

    Basis Of Award = Fair and reasonable

    price.

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    What are the GSASchedules?

    GSA Schedules are the groupings ofcommodities or services identifiedunder the program.

    They represent more than four millionproducts and services.

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    Why Do I Need A GSASchedule Contract?

    You need a contract with GSA when youare trying to sell your products orservices to Federal agencies who only

    want to buy products and/or servicesfrom GSA contract holders.

    They are not mandatory but they are apreferred source of procurement for mostgovernment agencies.

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    GSA Multiple AwardGSA Multiple AwardSchedulesSchedules

    Michael KlewickiMichael Klewicki

    Patricia ClancyPatricia ClancyPhone: 248-722-1176Phone: 248-722-1176

    FAX: 248-547-9699FAX: [email protected]@aol.com

    SBASBAs Resources to Helps Resources to Help

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    pp

    Small Businesses ObtainSmall Businesses ObtainSubcontractsSubcontracts

    Commercial MarketRepresentatives (CMRs).

    SubcontractingOpportunities Directory

    SUB-Net -- Electronic

    Bulletin Board forSubcontracting

    Opportunities

    How Does One Locate aHow Does One Locate a

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    How Does One Locate aHow Does One Locate a

    CMR?CMR? From the SBA Home Page (www.sba.gov),

    click on SBA Programs and scroll down toGovernment Contracting.

    From Government Contracting Home Page

    (www.sba.gov/GC), click on Contacts andRepresentatives.

    The 4th menu selection on the next page will

    give you a list of all of SBAs CMRs(approximately 34 individuals)

    What Makes a GoodWhat Makes a Good

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    What Makes a GoodWhat Makes a Good

    Contractor?Contractor? Understand every detail of the statement of work

    (SOW) as it applies to your subcontract Understand the Governments expectations atthe prime contract level

    Meet the terms & conditions of your subcontract,especially with respect to price and delivery

    Keep the lines of communication open

    Dont let problems fester Dont let your customer ever be surprised!

    What Does the Federal GovernmentWhat Does the Federal Government

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    What Does the Federal GovernmentWhat Does the Federal Government

    & Prime Contractors Look for in a& Prime Contractors Look for in aContractor/SubcontractorContractor/Subcontractor??

    Firms that can provide products or servicescheaper or better (more efficiently) than if theywere made or performed in-house

    Good references Socio-economic status

    Firms that can help a prime contractor to meet its

    socio-economic goals on Government contracts arealways a bonus

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    1) Is my business bigenough?

    Responsible

    Competitive

    Patient in dealing withbureaucracy

    Committed to invest resources tomarket to the government

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    SBA Small Business SizeStandards

    500 Employees for most manufacturing

    100 Employees for all wholesale trade industries

    $6.5 Million for most retail and service $31 Million for most general construction

    $13 Million for all special trade contractors

    $.75 Million for most agricultural industries http://www.sba.gov/size

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    2) Do I have the financialcapability ?

    Are you just starting out, short oncash flow, able to make payroll &

    other payments without problems?

    3) Do I have a quality

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    3) Do I have a quality

    assurance program ?

    Candidate's Existing QA system

    ISO 9001, ISO 9002, QS 9000, ASQC-E4

    ISO 14001, and ISO 10012-1

    4) Does the business have

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    4) Does the business have

    the technology ?

    Computer

    Modem

    Dedicated telephone line Internet connection

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    5) Do you have Internetaccess ?

    Electronic bid boards.

    IQS Internet Quoting System.

    Web invoicing system.

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    Yes, Yes, Yes, I can do it !Oh, are you aware of the government

    rules? They are called the FAR (FederalAcquisitions Regulations).

    http://www.arnet.gov/far/

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    There are several on-line training courses that can help you better understandthe Federal Procurement Process:

    www.sba.gov/training

    Business Opportunities and Guide to Winning FederalContracts

    Introduction to Federal Contracts

    Insight: Guide to the 8(a) Business Development Program

    SBASBAs Key Internets Key InternetAdd

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    AddressesAddresses

    SBAs Home Page: www.sba.gov(includes a link to SUB-Net)

    Government Contracting:www.sba.gov/GC

    SDB: www.sba.gov/sdb HUBZone: www.sba.gov/hubzone

    Women: www.womenbiz.gov

    Also www.women-21.gov

    Vets: www.sba.gov/VETS/

    Michigan PTACs

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    Michigan PTACsMuskegon Area FirstBig Rapids (231) 796-4484

    Wayne State UniversityDetroit (313) 577-2241

    Genesee Regional Chamber of CommerceFlint (810) 600-1432/1433/1434

    Technical Assistance Center ofSouth Central MichiganJackson (517) 788-4680

    S.W. Michigan Technical Assistance CenterKalamazoo (269) 381-2977 ext. 3243/3245

    Schoolcraft College Procurement TechnicalAssistance CenterLivonia (734) 462-4438

    Macomb Community College PTACThumb Area Satellite OfficeMarlette (989) 635-3561, Ext. 227

    Muskegon Area FirstMuskegon (231) 722-7700

    N.E. Michigan Consortium

    Onaway (989) 733-8548

    Economic Development Alliance ofSt. Clair County

    Port Huron (810) 982-9511

    Saginaw Future, Inc.

    Saginaw (989) 754-8222, Ext. 232

    Downriver Community Conference

    Southgate (734) 362-3477

    N.W. Michigan Council of

    Governments

    Traverse City (231) 929-5036

    Macomb Community College PTAC

    Warren (586) 498-4039/4142/4163/4122

    Michigan Minority

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    g y

    Business Enterprise Center

    A Federally Funded Program under the Minority Business Development Agency

    U.S. Department of Commerce

    and

    Operated by The Michigan Minority Business

    Development Council

    MMBECs & MMBDCs

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    Mission Statement

    The MMBEC has a collaborative mission statement with MMBDC

    to achieve entrepreneurial parity for minority business enterprises(MBE) by actively promoting their ability to grow and compete inthe global economy.

    MMBEC is addressing these challenges faced by MBEs by

    offering services that provide the keys to entrepreneurialsuccess:

    1. Access to Markets (Federal & State contract opportunities)

    2. Access to Capital (Debt and Equity financing)

    3. Access to Strategic Consulting (bid assistance)

    Michigan Small Business &

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    Technology Development Center An outreach partner of the U.S. SBA with

    offices throughout the state. Provides services to new, emerging and

    established ventures Counseling (no-cost)

    Training (low-cost)

    Research (no-cost)

    Special Programs

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    for Established Businesses

    Venture Forward Entrepreneurial Training

    Fiscal Fitness for the Growing Business

    PeerSpectives CEO Roundtables

    Regional Director Contacts

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    (www.misbtdc.org)Wayne / Oakland

    Richard King Eastern Michigan

    University

    734-487-0490

    Macomb

    Don Morandini Macomb Economic

    Development

    586-469-5118

    Washtenaw (Ann Arbor)

    Charlie PennerWashtenaw Community College

    734-547-9170

    3 THINGS TO REMEMBER

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    3 THINGS TO REMEMBER

    KNOW YOUR CUSTOMER

    Who buys your product or service

    How they buy When they buy

    KNOW THE RULES

    Federal Acquisition Regulations

    Contract requirements and specifications Contract history

    PERFORM AS PROMISED

    On-time delivery

    Quality Price

    On Receiving a Solicitation

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    First 3 Things to do

    1. Read It Carefully

    AND

    On Receiving a Solicitation

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    On Receiving a Solicitation

    2. Read It Again

    AND

    On Receiving a Solicitation

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    On Receiving a Solicitation

    3. Read It Again

    Final Thoughts

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    Final Thoughts

    The Federal Government can be a great

    market for many small businesses.BUT

    To succeed you must fully commit tolearning all aspects of contracting thefederal government way.

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    QUESTIONS?