The federal fiscal year ends in September, which means that federal agencies have until then to spend the remaining money allocated in their budget — or face losing it forever. Worse, any money they don’t spend ends up reducing their budget for next year, strongly incentivizing government entities to hire contractors and spend every last dime possible.
This period represents an amazing time for construction companies to compete for federal contracts. Lucrative opportunities abound, but they can only be accessed by those with the resources and qualifications to tap into them.
Here are some ways for your construction firm to prepare for this period and dramatically increase revenues through gaining government contracts.
Become Aware of the Best Opportunities
Without a doubt, military contracts and contracts provided by the Army Corp of Engineers represent some of the best contracts available to small firms. In particular, plans for base renovations or newly built structures are often finalized and ready for bids in the summer months leading up the September FY end.
Contracts to look out for include: barracks improvements or expansions, base stores, base infrastructure and public building maintenance.
Register to Be a Part of the Federal Contract Bidding System
Your first step to getting your foot in the door to compete for federal contracts is to register in the System for Award Management (SAM). SAM is part of the General Services Administration (GSA), and it is free to use. Registering allows federal agencies to see your company during contractor searches, and it also streamlines the process of indicating your qualifications to fulfill a given contract.
After registering on SAM, you can then seek to get added to the pre-approved bidder list for GSA to make preparing bid proposals easier and to be considered alongside other contractors.
Make Sure You Have the Right Surety Bonding Limit
The U.S. Miller Act requires that all contractors have performance bonds and payment bonds in place before being able to legitimately bid on federal contracts valued at $30,000 or more. Although it is not an explicit requirement of the Miller Act, federal agencies may also request that you present these bonds as well as a bid bond even if the contract is less than $30,000 in value.
If you have been engaged in a lot of concurrent projects lately, you may need to raise your surety bonding limit to be able to add a federal contract onto your project calendar. You can use specific accounting and finance practices that lessen the perception of financial risk for your company to increase your chances of getting approved for a higher bonding limit.
Unlike the private sector, no response to a bid does not necessarily mean that your chances of getting a contract are nil. You have to invest a fair amount of time and energy into your bids in order to have them considered, but if you keep submitting and take into account the specific factors federal acquisition programs look for, you can eventually get your first government contract.
Best of all, winning one contract can dramatically increase your chances of subsequent successes, so have faith and keep at it!
If you need help obtaining surety bonds or learning more about the needed qualifications for a government contract bid, you can contact us at any time for answers to your questions or to get help increasing your aggregate bonding limit.