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Government Contracting: Explaining the Process in 5 Steps

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Government Contracting: Explaining the Process in 5 Steps

Published: August 3, 2010 Updated: January 20, 2016

It is very common for small businesses to have services and products to sell to government; and the drive to make those sales happen- but not necessarily to understand the government contracting process.


There is almost nothing simple about selling to the government. As -ve said before, while the government is the worl's largest consumer, it is also a completely different market than the commercial space. Selling to the government requires a completely different knowledge base.


It can be quite helpful, however, to understand how the process works and what to expect.


The following is a quick look at the overall contracting process. Very large bids, as well as very small bids, will likely have a different process. But this short explanation will be a good place to start, especially if yo're a small business looking to get a foot in the door.


Step One: Planning and Research

I probably sound like a broken record, but planning and research are your most critical first steps. See my previous blog post,'Your First Five Steps in Government Contracting' which maps out the basics of research, planning, getting onto the Central Contractor Registration database, and more.


Step Two: Invitation For Bid

Once yo've got all the basics in place, yo're ready to respond to an Invitation For Bid (IFB). This is a document (written or electronic) issued by an agency that will include all the information yo'll need to understand a) if this is appropriate for your company to pursue, and b) how to submit your bid.


The IFB will include a complete description of the service or product the agency is looking for, purchasing conditions (including the type of contract), delivery schedule, and more.


Some IFBs have long lead-times, some can be quite short. Your best bet is to be prepared in advance. Be sure to have company, service, and product descriptions' as well as customer references - prepared in advance so you can turn around a bid quickly and efficiently.


Agencies issue IFBs through FedBizOpps.


It is important to note that an IFB is different than a Request for Quote (RFQ) or a Request for Proposal (RFP). An RFQ is issued against the General Services Administration Multiple Award Schedule Program. An RFP is generally much broader and more open-ended than an IFB, used for projects wherein the government may be looking to the contractor community for strategy and implementation ideas.


Step Three: Bid Submission

Part of your Planning and Research step is to understand the overall market for your service or product, and your target agency's history of how it prefers to buy your service or product. This research will come into play when crafting your bid.


One of the most important things to keep in mind is that the lowest price is not always what your prospect is looking for. More often than not, agencies are looking for experience. Government customers value positive past performance, previous government experience, and stability.


The government wants to trust that you'll get the job done more than it wants to save money. If you can't get the job done, that will cost more in the long run.


Step Four: Oral Presentations

Your submission process does not end when you submit your bid. There is a possibility that you may be asked for more information.


One of the things you may be asked to do is to give an oral presentation of your bid. If the agency has the decision narrowed down to two or three bidders, the bidders may be asked to provide an oral presentation to go over details of the bid and describe how the work will be accomplished.


Oral presentations are more common with RFPs, but it is nevertheless something every vendor should be prepared to deliver.


Step Five: Contract Award

Throughout the decision process the government agency may continue to ask for more information. This is a good sign - it means they're interested enough to know more. Keep providing whatever the agency needs. At some point, a decision will be made and the contract will be awarded.


Next Steps

Once the contract is awarded, you'll be in regular communication with the awarding agency - to set up initial meetings, deadlines, and any other details that still need to be ironed out.


Remember, government values past performance above almost all other criteria. If you win a bid, do a great job - knock it out of the park - so you can use that agency as a reference of past performance and continue building your government business one contract win at a time.




Additional Resources


Bill Gormley is President and CEO of Washington Management Group and FedSources, Chairman of the Coalition for Government Procurement, and a Director on the Procurement Round Table.


About the Author:


What can a small business do when the government currently doesn't purchase the particular product he has for sale? For example, live or head on marine fish that's farmed, as close to organic as currently possible, extremely fresh, and not exposed to high levels of ocean water pollution?
Bill, thanks for the write up as it helps me understand getting into the world of federal contracts. I have searched up and down on Fedbizopps website for opportunities for my company, but never see any come up. I see other vendors providing similar services for the government, but I don't see how they getting the business. Is there a threshold dollar amount where they can just pick a company and go with them?
Thanks for the great information. I'm looking forward to learning more on this site but looks like i have allot of reading to do. Chad

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