Expanding Your Business with Governmental Contracts May 25, 2016My BusinessOff

Did you know that the federal government spends more than $400 billion per year on their departmental needs? From office supplies and equipment to outsourced services, the federal government can rack up a hefty bill on business expenses and operational costs. What makes this information beneficial for small business owners is that there is a HUGE opportunity to make money.

Of the billions of dollars the federal government spends every year on contracts, they are required to award approximately 23 percent of all contracts to small business owners. Essentially as an entrepreneur, if you can land a contract with one of the biggest purchasers of goods and services, you’re looking at a pretty decent payday.

Obtaining Government Contracts
If you believe that government contracts could prove beneficial for your small business, you must be prepared to roll up your sleeves and get down to it. There are a few things you’ll need to understand as the federal government isn’t simply going to hand these contracts over to just anyone.

There are resources such as the U.S. Small Business Administration that can help you in registering and aligning your business to be eligible for upcoming contracts. Once you’re registered, working with platforms like BidSync can make it easier for you to locate government contract opportunities, draft proposals, and secure bids.

Benefits to Securing Contracts
When a government agency is in need of services, they release what is referred to as a request for proposal or RFP. This ideally means that the contract is up for grabs. Depending on the type of contract, the size of your business, and the type of business you operate, you can make a proposal and get a chance to secure these contracts. While the process can be time-consuming and frustrating in the beginning, when you see the benefits listed below, chances are it’s worth it.

Dependable Income
One of the most obvious advantages to securing government contracts is the potential income it could bring your way. If awarded the contract, details are negotiated and finalized and payments are received on a regular basis for the duration of the contract. This is a great way to earn steady income for businesses who are new, want to expand, or who have slow periods where they need to fill in the gaps.

Great for Branding & Increasing Portfolios
Anyone who’s been in business for a while knows it can be challenging to secure new clients. Getting consumers to trust you, your company, and your ability to provide the products or services they need can be hard in the beginning. However, when you can advertise or list government contracts your company has, many of the insecurities the customer might have in doing business with you will subside. If the federal government has been doing business with you, you must be a fairly decent business…. Right? Therefore, securing a few government contracts can make your business look a lot more attractive to potential clients.

Increases Your Company Value
Who doesn’t want a valuable company? Well, when you fulfill contracts with the government and do a great job at it, this can work in your favor. So should you need to apply for a line of credit, secure a business loan, attract more investors, or even sell your company, having the ability to say you’ve developed great relationships with government agencies greatly increases your value. The better reputation your company has, the more earning potential which looks attractive to financial institutions and investors.

So yes, you may have to go through a bit of a process to register and bid for government contracts, and it may even take time to secure your first contract. However, when you see the advantages it brings to your business such as increased earning potential, new clients, improved reputation, and overall increase in value, it really is worth a try. With billions of dollars out there for grabs, the opportunities aren’t going to last long. If you’re new to bidding on contracts in general, you’ll want to start by checking out resources such as the U.S. Small Business Administration to learn about requirements and to get registered.

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