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Basics to Government Procurement

Basics to Government Procurement

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Basics to Government Procurement

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  1. Basics to Government Procurement Small Business & Technology Development Center (SBTDC) Procurement Technical Assistance Center (PTAC) Archie Black Procurement Counselor 704 548-1090, ext 3346

  2. Small Business & Technology Development Center (SBTDC) Confidential one-on-one counseling General Business - planning, marketing, financing, human resources & operations Manufacturing & Technology Development and Commercialization International Business Marine Trades Management Education Services Procurement Technical Assistance Center (PTAC)

  3. SBTDCStatewide Presence Asheville, Beaufort, Boone, Chapel Hill, Charlotte, Cullowhee, Durham, Elizabeth City, Fayetteville, Greensboro, Greenville, Hickory, Pembroke,Raleigh, Rocky Mount, Wilmington, and Winston-Salem

  4. PTAC services. . . Assist businesses in selling their products and/or services to the federal, state and local government Understanding government procurement policies and procedures (differ at each level of government) Completing mandatory registrations Obtaining small business program certifications Defining target agency(s) Fine tuning market strategies Locating procurement opportunities Reviewing bids and proposals Types of procurement tools (IFB, RFP, GSA, Impact Card)

  5. What can the Government Market do for my business? • What a Government Contract can do for your business • Diversify your customer base • Cover overhead costs • Even out cash flow • What a Government Contract can notdo for your business • Jump-start your business • Save your business • Should not be the sole source of your business

  6. What can the Government Market do for my business? • Government Contracting Facts  • Less than 5% of the businesses in the United States do business with the U.S. Government. • The U.S. Government is the largest company in the world. Approximately $1 billion in new opportunities in the services sector of Government contracting were available to bid on by private business each day. • The federal government signs over 11 million contracts a year. • Companies are winning and are awarded new contracts daily. • About 95% of federal contracts are awarded to small- and medium-sized business vendors. 6

  7. What can the Government Market do for my business? • Government Contracting Facts  • Government procure services range from Food Services and Janitorial projects to complex space flight systems development. • Small Business Set-Aside Program (SBSA) was developed to help assure that small businesses are awarded a fair proportion of government contracts by reserving certain government purchases exclusively for participation by small business concerns. • Any contract that has an anticipated dollar value between $3,000 and $100,000 in value is reserved for small, small disadvantaged, woman-owned, and small veteran-owned businesses, small HUBZone and small service disabled veteran businesses. 7

  8. What can the Government Market do for my business? • Benefits   • You get paid regularly from this client. Government contracting allows businesses, many small and mid-sized businesses, to have a bevy of profitable, long term contracts. • For example, many Federal Government contracts have continuous contract terms for three to five years. This provides a long term steady cash flow with decent profit margins. • Your client won't move away, run away and hide, and not pay their bills. • The high profile your company achieves as a result of Government Contracts is a good advertising tool for your firm. 8

  9. What can the Government Market do for my business? • Benefits   • Government contracting can make your business grow fast. Companies currently involved in government contracting started out with smaller contracts and worked their way into larger and larger contract awards. • Begin to prepare your company today for long term growth in the expanding Federal Government marketplace. • The government is literally seeking vendors in all avenues of business. Whatever service or product your company provides, the government is seeking it. 9

  10. Potential State/County • State Agencies • Universities • Community Colleges • Public Schools • Institutions • Local Governments

  11. Potential Federal Customers • Department of Defense (largest purchaser) • Military Installations • General Services Administration (GSA) • Veterans Administration (VA) • Defense Logistics Agency (DLA) • Federal Emergency Management Agency (FEMA) • United States Department of Agriculture (USDA) • Department of Housing and Urban • Department of the Secretary of State 11

  12. How the Government Buys • The government purchases the products or services it needs by two methods: sealed bidding and negotiation. • The sealed bidding is formal advertising which involves the issuance of an Invitation for Bid (IFB) by a procuring agency. Following receipt and evaluation of the bids, a contract is usually awarded to the lowest priced bidder, determined to be responsive and responsible by the contracting officer. • The second method of competitive proposals is buying by negotiation which involves the issuance of a Request for Proposal (RFP) or Request for Quotations (RFQ), and the negotiation of each element in the proposal. An award is made to the proposer who has the best proposal in terms of both technical content and price.

  13. Common Items the Government Buys Architectural: Civil Engineering, Engineering Design and Drafting Cleaning and Custodial: Janitorial Equipment and Supplies, Linen and Towel Services, Parking Lot, Window washing Construction and Remodeling: General Contractor, Roads, Bridges,/ Sidewalk, Roofing / Roof, Door, Window, Ceiling, Flooring / Floor, Fencing / Fence, Painting, Carpentry, Cabinet, Mill Work, Plumbing, Pumps, Pipeline, Sanitation, Drainage, Water-Proofing, Electrical / Electronic, Lighting, Elevators, Escalators, Lifts, Playground Construction and Building Materials: Masonry, Stone, Brick, Tile, Drywall, Plaster, Road Work, Concrete Consulting Services: Grants Writing, Lobbyist, Legal, Litigation, Mediation, Arbitration Environment and Conservation: Surveying, Mapping, Aerial Photography, Environmental Testing, Site Inspection, Asbestos, Hazardous Waste, Trash Disposal, Recycling, Waste Water, Sewage Treatment, Air Purification, Tanks, Excavation, Demolition, Salvage 13

  14. Common Items the Government Buys Financial and Accounting: Accounting, Bookkeeping, Auditing, Credit Card Services, Credit Reports, Medicaid billing, Debt Collection, Financial Consulting, Retirement Plan, Investment Food Services: Cafeteria, Catering, Drink, Vending Machines, Concession Stands Garden and Landscaping: Lawn Care, Mowers, Snow Removal, Sprinkler, Irrigation, Insect, Pest and Bird Control, Herbicide HR Services, Personnel, Staffing, Recruiting, Executive Search, Training, Office and Clerical, Secretarial, Proficiency Assessment, Relocation Computer Hardware: Computer Cabling, Hardware Rental, Repair and Maintenance Computer Software: Information Technology (IT) Consulting, Programming, Computer Security, Firewall, Database, Data Storage, Backup & Recovery, E-learning, Computer or Web-based Training, E-Procurement Display, Graphic Design 14

  15. How can the Government Find You • The government is literally seeking vendors in all avenues of business. Whatever service or product your company provides, the government is seeking it. 15

  16. Steps to Sell to the Government Determine small business program set aside eligibility Identify your product or service Obtain appropriate commodity/service codes Register in federal/state/local contractor databases Find current procurement opportunities Familiarize with Government contract procedures

  17. Steps to Sell to Government Investigate feasibility of Federal Schedule Supply (FSS) and/or State term contracts Credit card purchases – are you set up Explore subcontracting opportunities Determine customers to target - Review federal, state and local gov’t procurement policies and procedures BUILD LONG TERM RELATIONSHIPS HAVE A SOUND MARKET STRATEGY 17

  18. Small Business Program - Federal • FAR PART 19 – Small Business Program • It is the policy of the Government to provide maximum practicable opportunities in its acquisitions to: • small business, veteran-owned small business, service-disabled veteran-owned small business, HUBZone small business, small disadvantaged business, and women-owned small business concerns. • such concerns must also have the maximum practicable opportunity to participate as subcontractors in the contracts awarded by any executive agency, consistent with efficient contract performance. • the Small Business Administration (SBA) counsels and assists small business concerns and assists contracting personnel to ensure that a fair proportion of contracts for supplies and services is placed with small business.

  19. Small Business Set Aside Program - Federal • 8(a)/SDB Business Development Program • SBA application and certification process • Must be small business • 51% owned and controlled by small and disadvantaged individual(s) • 9 year business development program • Small Disadvantaged Business (SDB) Program (no set aside procurements) • 5% goal for federal agencies • Must be small business • 51% owned and controlled by small and disadvantaged individual(s) • Self certification 19

  20. Small Business Set Aside Program - Federal • Historically Underutilized Business Zone (HUBZone) • SBA application and certification process • Must be US Citizen • Must be small business • Principal office must be in a HUBZone and 35% of employees must live in a HUBZone • 3% goal for federal agencies 20

  21. Small Business Set Aside Program Federal • Women Owned Business Program (no set aside procurements) • 5% goal for federal agencies • 51% owned and controlled by a woman(s) • Must be small business • Self Certification • Service Disabled Veteran Owned Business Program • 3% goal for federal agencies • 51% owned and controlled by a SDV • Self Certification 21

  22. Government Procurement DollarsFY 2007 • Federal Procurement • $440 Billion • Small Business Market Share - $60 Billion • State of North Carolina Procurement • $4 Billion a Year

  23. Federal SpendingFY 2007 Dollars1 Oct 06 – 30 Sept 07 Total Small Business Eligible Dollars - $379B Small Business Dollars -$84B or 2.22% SDB Dollars - $25B or 6.58% Veteran - $10B or 2.88% SDVOSB - $14B or 1.1% Woman Owned Business - $13B or 3.41% HUBZone Business - $9B or 2.24%

  24. Federal SpendingFY 2007 Subcontracting Dollars1 Oct 06 – 30 Sept 07 Total Small Business Eligible Dollars - $185B Small Business Dollars -$65B or 35.5% SDB Dollars - $9B or 5.0% Veteran - $5B or 2.79% SDVOSB - $1B or .83% Woman Owned Business - $11B or 5.91% HUBZone Business - $3B or 1.53% 24

  25. Small Business Programs for State and City/County Procurement • Historically Underutilized Business • Don’t confuse with HUBZone • NC Office of Historically Underutilized Business certification • Aspirational goals may vary by state agency, city and county • Construction contracts • Procurement of goods and services • NC Department of Transportation ( • Disadvantaged Business Enterprise (DBE) • Small Business Enterprise Program SBE) • City/County • M/WSBE Programs • HUD/MWSBE Coordinators 25

  26. Small Business ProgramsHistorically Underutilized Business • Statewide Uniform Certification (SWUC) • streamlines the certification process by reducing the number of public sector entities by which businesses must apply for certification. • provides for a centralized, uniform, comprehensive, statewide database of certified HUB/MWBE firms that prime contractors, project managers, purchasing agents, and HUB /MWBE Coordinators can utilize. • All firms that are certified as Historically Underutilized Businesses to participate in Minority Business Programs as minority, women, disabled, or disadvantaged owners will be listed on the unified SWUC Directory. 26

  27. State Spending -- FY 2006 -2007July 1, 2006 – June 30, 2007 • Construction • Total Purchases - $781.1M • HUB Purchases - $100.4M or 12.85% • HUB Purchases – Goods and Services • Total Purchases - $4.8B • HUB Purchases - $372.7M or 7.77% • MBE - $121.4M or 2.53% • WBE - $221.7m OR 4.62% • Disabled - $12M or .25% • Non profit - $2.9M or .06% • Subcontract - $10.5M or .22% 27

  28. Registration – For Federal Procurement • Central Contractor Registration (CCR) ( update annually) • DUNS number – Data Universal Numbering System (free) • TIN – Tax Identification Number • NAICS code (North American Industrial Classification System) • SIC – Standard Industrial Classification • FSC – Federal Supply Classification • PSC – Product Service Code • Banking Information • Primary and Alternate Contact Information • Complete SBA Profile • After registration in CCR is validated • Document your SBA number

  29. Registration – For Federal Procurement 29 • On line Representations and Certifications -ORCA • Website: • To register you need: • DUNS number – Data Universal Numbering System • MPIN • NOTE: Complete registration in CCR and SBA profile and ORCA before completing applications for 8(a), and HUBZone.

  30. Registration – For State Procurement • NC E-Procurement: • Informal and formal • 1.75% fee • Vendor Link: • User Id and password • Tax ID Number • Email address • NIGP Codes • HUB – Historically Underutilized Business can be done at registration

  31. Registration – For City/County Procurement • Check with each City/County Government website for registration requirements • Mecklenburg County: • City of Charlotte: ( 31

  32. Locating Bid OpportunitiesFederal Procurement • Federal Business Opportunities ( • Register business – it is the single government point-of-entry for Federal government procurement opportunities over $25,000. • Government buyers publicize their business opportunities by posting information directly to FedBizOpps via the Internet. • Through this portal, commercial vendors seeking Federal markets for their products and services can search, monitor and retrieve opportunities solicited by the entire Federal contracting community. • Check federal agency websites for Business opportunities • Procurement Forecast – ( 32

  33. Locating Bid OpportunitiesFederal Procurement • General Service Administration ( • contracts for a large volume of goods and services on a worldwide basis for all federal agencies. Products and services purchased by GSA include office supplies, paints, construction, training services, and computer-related supplies and equipment • Plans to introduce a bill that will open the GSA schedules to cooperative purchasing. Under that approach, nonfederal entities (state and local governments) will have access to the same goods and services federa; agencies can buy from GSA schedule contractors. 33

  34. Locating Bid OpportunitiesFederal Procurement • GSA Schedules • Review the list of GSA Schedule Solicitations to determine the applicable GSA Schedule and corresponding solicitation number under which the supplies or services may be offered.  • Click on the appropriate Solicitation Number to be linked directly to the solicitation files in FedBizOpps. • Download the solicitation and follow the instructions in the document 34

  35. Other Bid OpportunityWebsites for Federal Procurement Combined Headquaters Construction Employment and Subcontracting North Carolina Military Business Center: Army Single Face to Industry: Navy: DLA/DIBBS: USASOC: ACA Southern Region Contracting Ctr: 35

  36. Locating Bid OpportunitiesState/County/City • Interactive Purchasing System (IPS) ( • list bid opportunities for state agencies, universities, community colleges, counties and cities • electronic notifications • Search by category, department, bid number or open bids • Check agency websites for Business opportunities 36

  37. Locating Bid Opportunities • American Recovery and Reinvestment Act (Stimulus Projects) • - State Web site describing and tracking federal recovery funds in North Carolina and listing local contract and grant opportunities • - Federal Web site describing and tracking the American Recovery and Reinvestment Act • For NC and more specifically provided by the NC League of Municipalities. • For NC provided by the NC Association of County Commissioners 37

  38. Subcontracting Opportunities • SBA SUB-Net ( • List Contractors and description of work • Doing Doing business with DOD ( • List DOD Prime Contractors • Subcontracting Plans required for: • Commodities and Service contracts $550K or greater • Construction contracts $1M or greater • Certifications (8a), SDB, HUBZone, Woman, Veteran, Service Disabled Veteran) are essential 38

  39. Subcontracting • Investigate the prime contractors • History of project performance • History of paying subcontractors • Know the contract requirements • Get subcontract agreement in writing • Performance and payment terms made clear prior to signing • Know who the contracting officer is • Be aware of when the inspector accepts your work 39

  40. Success - Steps • Learn who buys your products and/or services – Target the right customer • Know something about your customer/audience (website) • Be proactive --- build relationships early and often • Have professional promotional materials • Brochure • Capability statement • Website (updated information) • Small business certification(s) – critical for leverage • Visit Small Business Specialist or Procurement Representatives • Know your competitors • Attend networking events and trade shows

  41. Success - Steps • Have 3 marketing “presentations” ready at all times • Elevator speech • One page capability statement • Few graphics • Company name, website, contact info, locations, small business categories, CAGE CODE, NAICS code and capabilities • Certifications, contracts with POC info, subcontracts, GSA contracts • Full capability statement

  42. Business Liasons – Federal Procurement • Small Business Liaison Officer (SBLO) • Prime contractor employee (Public Law 95-507) • Subcontracting plans have goals • $550K> for goods and services • $1M> for construction • Good strategy for entry into federal procurement • Small and Disadvantaged Business Utilization Specialist (SADBU) • Is not a government procurement officer or buyer • Acts as liaison between business and buyers • Key person for marketing

  43. Federal Procurement Team • Contracting Officers (CO) • Only person that can obligate the government • Procurement Contracting Officer – pre-award decisions • Administrative Contracting Officer – post award decisions • Contract Specialist and/or Administrator • CO assistant in the procurement process • Program Managers • Technical experts • Control budgets • End Users • Initiates the requirement • In some cases recommends the source

  44. State, City, County Procurement Team • Division of Purchase and Contract( • List of state Purchasing Managers and Procurement Specialist • Business Liaisons • Office of Historically Underutilized Businesses • List of HUB and MWSBE Coordinators • Universities, Community Colleges • Cities, Counties, Municipalities • State Prime Contractors • Public School Systems 44

  45. Key Websites Central Contractor Registration: ( ORCA: ( Federal Business Opportunities: ( DUNS: ( NAICS Code: ( SIC Code: ( FSC Code: ( PSC codes: ( ) NIGP Codes – ( 45

  46. Key - Websites • Federal Acquisition Regulation (FAR) • • Vendor Link • • Interactive Purchasing System • • NC Agency Purchasing Manual • • State Construction Office • 46

  47. Key -- websites • Federal Government acronyms • • Research contacts and opportunities • Federal Procurement Data System (FPDS) • • Statistical information on federal contracting • Detailed data for >$25K • Summary data for <$25K

  48. Key -- websites • DOD Prime and Subcontracting Goals • • HUB Spending Report: • • Small Business Administration Goaling Program • 48

  49. Procurement Types – Federal Procurement • Micro-Purchases • Purchases Less than $3000 (supplies), $2500 (services) and $2000 (construction) • Credit Card transactions or purchase orders • Open to large and small business • Competition not required • Approximately 700,000 cards issued • $18 billion in annual sales

  50. Procurement Types - Federal Procurement • Simplified Procurement • Purchases $3000 up to $100,000 • Set-aside for small business only • Informal buys up to $25,000 • Formal advertisement required for purchases over $25,000 • Can be set-aside for 8(a), HUBZone and SDVOSB companies • Request for Quote (RFQ)