Market forces like reshoring, an aging workforce, and greater requirements for sustainability continue to drive demands for manufacturing automation. This is just as true for the U.S. Department of Defense (DOD) as it is for commercial organizations. It’s imperative for the DOD to work with factories and repair centers that are efficient, safe and cost-effective.
In 2014, the DOD awarded $53 billion to small business contractors. Although it may seem intimidating to sell to the government, the opportunity is there if you’re financially sound, well prepared and persistent.
Here are 5 steps you need to take to become a small business defense contractor:
1. Make sure you really are a small business
The government defines small businesses in two ways, revenue and number of employees. Select the NAICS codes that best describe your business. NAICS codes are 6 digit codes that categorize your businesses section and industry. The National Technical Information Service (NTIS) site provides the official NAICS manual with industry descriptions and codes. You can then determine if your business meets small business size standards by using this tool.
2. Get the credentials
You know you’re a small business and you’ve identified your NAICS codes. Next:
- Know your DUNS Number. This is the number the government uses to identify your business. Obtain one here if you haven’t yet.
- Register and create a profile in SAM (System for Award Management). This is a database of companies wanting to do business with the federal government. You’ll need to have this in place before you can bid on any projects.
3. Follow procurement notices
The federal government posts all opportunities greater than $25,000 to fbo.gov. Set alerts so that you’re automatically emailed any new requests daily and learn how to identify which opportunities pertain to your business. Once you find an opportunity, you can either add yourself as an interested vendor or add it to your watched opportunities list. For lower priced items, often ordered in multiples, check the DIBBS site (you’ll get a certificate warning from your browser). Finding appropriate opportunities is one of the biggest challenges. Learn about new opportunities as early as possible by looking for long range acquisition plans. The U.S. Air Force LRAE (long range acquisition estimate) site is an example.
4. Staff your proposal team
It’s important to have a company champion or a team of people who are committed to understanding federal guidelines and keeping up with changes to regulations. Contract management is a critical part of becoming a successful small business defense contractor. When you’re writing your first proposal, you’ll want to have that person or team established to manage communication with the project’s contracting office.
5. Document previous successes
The government will typically evaluate your proposals in three areas: technical capabilities, price and past performance. Write up brief descriptions of your past projects and keep them up to date. Understand and describe why your customer chose you over your competitors. Government agencies want to see that you have a history of success, so it’s important to maintain this past performance library.
Once you narrow your focus and establish relationships, you’ll find it’s easier to succeed. As in any industry, networking is critical and one of the best groups for learning the DOD market is the National Defense Industrial Association, with chapters in every state.
It’s a matter of pride for us to support the U.S. Department of Defense with excellence. I’m sure that you’re going to feel the same way.
Gary Vogelsong is the contracts manager for RedViking. His team focuses on government contracting and compliance. Gary attended the United States Military Academy, has a degree in Mechanical Engineering and is currently a US Army inactive Reserve Officer. RedViking is a member of the Control System Integrators Association. Visit RedViking’s profile on The Industrial Exchange.
