Contracting with Government

1. Contracting with Government Discussion from the trenches Cecelia McCloy, President Integrated Science Solutions, Inc. © ISSi

2. Who buys all these products or services? • Cabinets • Cattle • Nuclear Engineering services • Rocket propellant • Processed cheese • Containers • Bricks • Paper • Microbiologic Services © ISSi Alliance West

3. Is the Federal Government a Customer for me? The numbers are impressive • 2006 - $300B in contracting • 23% contracting goal to small businesses • Goals for SDV; Minority; WOBs; Hubzone • Services and Products bought are extensive • BUT -It is difficult to do business with the federal government © ISSi Alliance West

4. It Will Cost You to Play • Marketing will take $$$ and time • Identifying an opportunity to getting a contract can be anywhere from 6 months to two years • Start small – look at subcontracting opportunities • Build your past performance • Bidding can be expensive – Responding to a Full Request for Proposal as prime bidder • $25,000 to $55,000 (SB prime contracts) • Many hours of work with a multiple volume set • Need the right people to bid and to run the contract • Need the right operational systems to perform © ISSi Alliance West

5. Plan • Which agencies buy my services and/or products? • What are my services or products? Past Performance • All agencies have public web pages, review them • Some agencies have procurement forecasts • All agencies require large business prime contractors to have small business plans • Is a GSA contract an option • What should my win strategy be? • Some agencies are friendlier to small businesses then others – learn who they are • Network, Network, Network • Ask – Why would someone want to team with me? © ISSi Alliance West

6. Plan • How to I find opportunities? • Monitoring the Web • www.Fedbizopps.gov • Try a private government bid portal • Work with the Small business representatives from the agencies • Attend Industry Days or Outreach Events for Agencies • Use the Small Business Administration and affiliated organizations © ISSi Alliance West

7. Plan • Identifying – Bidding – Winning • Design your strategy to ensure a Win • What is the true likelihood of a Win • Is there an Incumbent? Is the agency happy with them? • What does it take to win? Best Value? Low Price? • Does this opportunity match my business? • Should I team? • Do I have a history with this customer? Do they know me? Can I do all the work? Strategic Partnering? © ISSi Alliance West

8. Downside to Working for the government • Bidding process is long and can be complicated • You may need to hire help! • There are lots of rules • Federal Acquisition Regulations (FARs) • There are implications for your business processes (accounting, time charging, benefits) • Maybe initial cash flow issues • Margins are not large on government contracts – longevity vs. profits <10% © ISSi Alliance West

9. Benefits of Federal Government Contracting • Stabilize your Cash Flow • Contracts are often of long duration • 2 to 10 years not unusual • Government Experience can raise the bar on your company operations • Hire key personnel • Providing a needed service to your community Alliance West © ISSi

10. ISSi story • First federal contract $300,000 as a subcontractor in March 1999 • First opportunity bid as major subcontractor July 1999 and won but delayed contract startup until Nov. 2000 • First win as prime contractor in March 2005 - Bid was in August 2004 • First invoice paid after initial 70 days • Carried payroll of 22 staff on contract © ISSi Alliance West

11. ISSi story ISSi Gross Revenue © ISSi Alliance West

12. Conclusion • Know why you want to work for the Federal Government or government contractor • Make sure you have identified a viable bid opportunity • Make sure your company can withstand the cash flow issues • Make sure you have the financial and operational systems in place when you win • Don’t hold back - Win © ISSi Alliance West