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A government contract can be a lucrative way for your company to make money in the coming year. With the federal budget increasing annually, expect more chances for your company to earn money in the future.
If you choose to obtain one of the lucrative contracts, be aware that your work must align with dfars compliance standards. Small companies can obtain such contracts, so don’t be afraid to try for one.
Different Types of Government Contracts
There are several different types of contracts you can obtain, depending on the services or goods you provide. Here are some of them.
- A Fixed-Price Contract
A fixed-price contract means you can’t change the price of goods or services once your contract is accepted. It will be your responsibility to make sure that you stay within budget.
- A cost-reimbursement Contract
With cost-reimbursement contracts, the government reimburses you for costs you have incurred, so long as they fall within a fixed ceiling. If you spend more than what’s allowed, you’re responsible for the difference. These contracts are usually awarded to nonprofit organizations for research and development projects.
- An Incentive Contract
Incentive contracts are meant to motivate companies to provide superior work. You can get one of these contracts if you do an outstanding job.
- Contracts for Materials and Time
If officials with the federal government are unsure as to how much time or materials they will need, they will award a time and materials contract. These contracts are short-term agreements that are most often used when handling disasters or emergency situations.
- IDIQ Contracts
IDIQ stands for indefinite delivery and indefinite quality. If officials with the federal government are unable to determine how many products they need, they’ll require one of these types of agreements. IDIQ contracts are typically used when the government needs to make multiple purchases or have many services provided over a specific time period.
How To Get a Government Contract
Although this list isn’t inclusive, these are some of the things you must do in order to get a government contract.
- Register Your Entity with SAM.Gov
You will need to register your business with the federal government in order to be able to do business. Go to the Sam.gov website to do this.
- Get Your Company’s NAICS Code
To help the government identify what goods and services you offer, you will need to look up the right NAICS code. You can find them by visiting the U.S. Census website.
- Market Your Business
Fill out a profile with the Small Business Administration. Doing this will enable government buyers to find your business. Also, create a website and include on it a portfolio of your skills and work history. Then network with other contractors. They can supply you with valuable information on the best way to win contracts.
Wining a government contact can be difficult, and it’s common for a bid to be rejected, especially if you are just starting out. Keep trying. You’ll find that winning a government contract is well worth it.