In the last installment of our ongoing series on federal IT sales, we looked at some of the processes and rules that are part of doing business with the government. In this installment, we'll describe the basics for finding government opportunities and landing contracts.
Those interested in selling to the government need to become familiar with Federal Business Opportunities (FBO). By 2014, the government plans to subsume FBO and other stand-alone federal acquisition websites under a single system, the System for Award Management (SAM). While FBO is slated for a merger, the functionality described here should remain much the same.
Despite its name, FBO doesn't exclusively contain stand-alone opportunity notices. The procurement process generates a lot of records, many of which land on FBO, and many of which contain useful information. FBO is a crowded, messy place where multibillion-dollar solicitations for advanced technology are published with requests for quotes for wooden shipping pallets.
Luckily, records are searchable via a variety of terms. The search engine accepts Boolean terms, defaulting to "or" searches -- that is, returning back any record that contains even just one keyword. Use "and" to exclude results that contain only one term when doing searches with multiple keywords. Multiple words surrounded by quotes are treated as a single search term, as in "information technology." FBO is also open to web crawlers, leaving the door open to searching via Google with the limiter "site:fbo.gov" after your search term.
Users also can create accounts from which they can set up watch lists, create and save search criteria, run those searches automatically, and respond electronically with quotes or proposals, if the contracting agency is set up for it.
Actual solicitations posted on FBO fall under the category of Combined Synopsis/Solicitation. The category name alludes to a federal law requiring that agencies synopsize the goods or services they want to acquire in the same document as a solicitation. Solicitations themselves often take the form of a request for proposals (RFP) or request for quotes (RFQ), but FBO doesn't categorize solicitation type according to contracting method.
Notices of future procurements -- perhaps the most important type of record you'll find on FBO -- fall under the categories of Presolicitation, Sources Sought or Special Notice. The types of records placed under those categories include draft RFPs, requests for information (RFIs) or sources sought notices (SSNs).
Agencies typically issue RFIs when they're considering a complex procurement for the future (about 12 to 18 months later), but aren't quite sure what they should buy and so canvas for private-sector feedback. SSNs crop up when the government has a tighter handle on its requirements and wants to test the market waters for potential bidders, particularly small businesses. If two or more small businesses respond to an SSN, the agency will often make the anticipated procurement a set-aside in order to meet its socioeconomic contracting goals.
Draft RFPs are the prelude to an actual solicitation. Agencies issue them to gain feedback on weak points and so remove anything that could later cause the procurement to be delayed. Both RFIs and SSNs usually contain language stating that they are for "planning purposes," and that a response "does not obligate the government." Not every RFI becomes a procurement, but Presolicitation participation is a key to contract actions.
Also dumped into the Presolicitation category are notices that the government intends to award without competition a contract to a company for a particular product or service. Such notices are called Presolicitations because the government may yet issue a formal solicitation. You can interpret Presolicitations as highly veiled calls for a competitor company to come forward with something better.
Under the Federal Acquisition Regulation (FAR), agencies must post notice to FBO of every planned federal acquisition expected to result in a stand-alone contract valued at more than $25,000. In fact, what ends up on FBO sometimes is nondescript and sparse, and might appear a day or two later than the more detailed record found on agency-specific procurement websites.
The worst offenders are the military services, primarily because they're accustomed to doing things their way. For example, the Army has the Army Single Face to Industry (ASFI) website, and the Department of Navy its Navy Electronic Commerce Online (NECO) site.
NEXT: Opportunities Worth Less Than $25,000So what about stand-alone contract opportunities not valuable enough for inclusion in FBO? Here's what happens:
* Notice of an opportunity worth more than $15,000 but less than $25,000 must be posted so local vendors can see it. This often means a paper notice tacked onto a publicly accessible "bid board" in a federal building.
* The Federal Acquisition Regulation (FAR) is silent on how federal agencies should handle opportunities worth between $3,000 and $15,000, but the typical practice is for contracting officers to phone and solicit three oral quotes from local businesses -- no public posting of the opportunity required -- particularly if the requirement is for commercial items.
* Any purchase worth $3,000 or less is simply made with a government-issued credit card.
Going after business at this level without a contract vehicle is only worthwhile if you're a small business, since government policy restricts contract awards for commercial items worth between $3,000 and $150,000 to small businesses.
Federal purchases worth less than $3,000 are mostly for workaday stuff. More likely than not, the government will pay for these transactions using government-issued charge cards called SmartPay, which is the official preferred payment method for purchases under the micro-purchase threshold. Any business that already accepts Visa and MasterCard can accept a government charge card. A SmartPay sale is just another plastic card transaction.
GSA Schedule Contract
General Service Administration schedules are multiple-award contract vehicles that create a catalog of government-approved price listings of commercial products or services with prenegotiated terms and conditions from which any federal agency can place an order. State and local governments can buy information technology through GSA schedules, too.
GSA posts schedule prices on GSA Advantage, which is an online ordering system for feds. GSA also runs an e-procurement system called eBuy, which allows agency contracting officers to electronically gather quotes from schedule holders only. A schedule can also gain you admittance to eMall, the Defense Department equivalent of GSA Advantage. Schedule-based RFQs need not be posted on FBO regardless of potential order size, since only stand-alone procurements need to be posted there, and the government doesn't consider schedule purchases to be stand-alone.
GSA schedule holders must accept SmartPay for purchases made under the micro-purchase threshold. You can elect to accept SmartPay for transactions worth more than the threshold. But remember: If you offer a prompt payment discount to government as a condition of your schedule, the discount, plus the credit card transaction fee, can eat away a major part of the slim margins allowed on these contracts.
Having a GSA schedule doesn't guarantee government business -- it's a license to hunt for federal customers. It also has heavy implications for the prices your company can charge to nongovernmental customers. It's possible to end up in a downward price spiral affecting your commercial and government prices.
The preceding information was adapted and digested from the book "The Inside Guide to the Federal IT Market," published by Management Concepts Press. For more information, visit www.insideguidetofederalit.com.
Steve Charles is a co-founder of immixGroup, which helps technology companies do business with government. He is a frequent speaker and lecturer on technology and the federal procurement process. He can be reached at Steve_Charles@immixGroup.com
PUBLISHED APRIL 17, 2013