Small Business Training

Transcription

1 Small Business Training An approach to Government and Prime Contractor Subcontracting Presented by the DOD Southeast Region Small Business Council Bill Cantrell, Council Chair Regional Deputy for Small Business and Assistant Director Army Engineer Research & Development Center Army Geospatial Center OSD Joint Test & Evaluation Program Member, White House Business Council x

2 Small Business Development Training Today s Agenda: Introduction Why Sell to the Government Module I Key Qualifications Module 2 Federal Acquisition Process Module 3 Rules of the Road Module 4 Small Business Goals Module 5 The Government Solicitation Module 6 Marketing to the Government and Prime Contractors 2

3 Why Sell to the Government? The US Government is the largest buyer of goods and services in the world. Reliable customer Open competition Small Business Programs Spends when economy is down State and local governments are a very large marketplace. May be less cumbersome than Federal Regulations Regional preferences may exist 3

4 Government Subcontracting Over $400 Billion Dollars Govt Contract Prime Contractor Over $240 Billion Subcontractors Sub Tier Contractors Remaining approximately $160 billion is reported in simplified acquisitions, P Cards, Inter Agency Purchases and Micro Purchasing 4

5 How Can Small Businesses Participate? The Federal Government buys from small businesses $40 Billion each year is contracted to small businesses 5

6 How can a small business compete? Congressional mandates to set aside for small business Federal Acquisition Regulations (FAR) attempt to level field Resources dedicated to small business Federal: Small Business Administration, Small Business Development Centers State: Procurement Technical Assistance Centers, State Development Authority Local: SCORE 6

7 How do I know I am ready to sell to the Federal Government? Critical Success Factors Financially stable/adequately capitalized Demand for your product or service Adequate time to devote to Government contracting Pricing and past performance 7

8 Small Business Training Module 1: Key Qualifications for Small Business 8

9 Module 1: Key Qualifications for Small Business How to Determine if your Business is Small The Small Business Administration (SBA) has established size standards based on your industry $ revenue or employee can and do change 37 categories based on North American Industrial Classification System (NAICS) Codes Details can be found at 9

10 Module 1: Small Business Key Qualifications Government Agencies or Prime Contractors will need to know who you are, what you have done, for whom, and how well you did it Have your answer ready: Clearly define your product or service Clearly define your capabilities Know your small business category Know the agency s mission Don t lead with your socio-economic status 10

11 Module 1: Key Qualifications for Small Business Small Business Categories Small Business (SB) Small Disadvantaged Business (SDB) & 8(a) Woman-Owned Small Business (EDWOSB & WOSB) Historically Underutilized Business Zone (HUBZone) Veteran-Owned Small Business (VOSB) no preference in DOD Service-Disabled Veteran-Owned Small Business (SDVOSB) 11

12 Module 1: Key Qualifications for Small Business The Small Business must be 51% owned and operated by the individual(s) who qualify for any categories. For Example: a "woman-owned business" is a business that is at least 51% owned by a woman or women who also control and operate it. "Control" means exercising the power to make policy decisions. "Operate" means being actively involved in the day-to-day management. 12

13 Module 1: Key Qualifications for Small Business SBA Certifications Confirmation of certification by the SBA is required by prime contractors and federal agencies to allow them to receive credit for purchases made to 8(a) and HUBZone firms. SDB is self certification as of Oct 2008 All other small business categories self-certify except HUBzone VA has special legislated rules for Vets/SDVets The certification process Contact your state PTAC or visit sba.gov for more information on how to apply for certification. 13

14 Module 1: Key Qualifications for Small Business Step 1: Central Contractor Registration Registering in CCR (note move to SAM) Go to Mandatory for all current & potential federal vendors Creates a Commercial and Government Entity (CAGE) Code that identifies your business within the federal purchasing/ payment system 14

15 Module 1: Key Qualifications for Small Business To register for CCR, you will need: D&B DUNS Number: for help SBA Certification For 8(a) Status: For HUBZone Status All other SB categories can self-certify; WOSB requires special steps for documentation To renew annually by accessing your information with your TPIN & DUNS # 15

16 Module 1: Key Qualifications for Small Business Step 2: Register at On-line Representations and Certifications Application (ORCA) Creates a single place for your small business representation & certification info Eliminates entering data with each bid/proposal (update annually) Examples: Debarred? Woman Owned? TIN? Affirmative Action? You can represent by hard copy 16

17 Representation of SB status Carefully read all the requirements that apply to the status that you are representing your business as You will be prosecuted for perjury if you falsify your SB status and Uncle Sam will go after monetary damages in addition to jail time This is one area where the federal government doesn t seem to have budget problems 17

18 Module 1: Key Qualifications for Small Business Get Informed Step 3: Understand the Federal Government contracting process Find opportunities Learn the rules Learn how to prepare a bid Learn how to perform on contracts Learn how to build on success 18

19 Module 1: Key Qualifications for Small Business There are several sources of information and assistance: The PTAC office in your state or region The SBA & Small Business Development Centers Small Business Liaison Officers (SBLO) at prime contractors Small Business Specialists at Federal Agencies 19

20 Module 1: Key Qualifications for Small Business Step 4: Develop a Marketing Plan Prime Contractor Subcontractor Both? Does the Federal Government buy my product or service? Do prime contractors buy my product or service? Only research will tell! 20

21 Module 1: Key Qualifications for Small Business What you need before you pursue government contracts/subcontracts Adequate capitalization Drive, determination, & patience Competitive advantage Demand for products/services Adequate Pricing and margins Effective quality system Current business plan Bonding, insurance and security clearance (if required) Computer Literacy, Internet capacity 21

22 KNOW YOUR CUSTOMER! 22

23 Small Business Training Module 2: The Federal Acquisition Process 23

24 Module 2: The Federal Acquisition Process Federal Acquisition Process differs from commercial purchasing Highly regulated Open and Fair Competition Contract clauses are take-it-or leave-it Uncle won t sign your contract agreement Specifications are stringent Government may cancel for cause or convenience Mandated socio-economic programs Penalties for noncompliance Subject to Government audit 24

25 Module 2: The Federal Acquisition Process What is the Federal Process? Pre-award - Determination of Need - Analysis of Requirement Solicitation & Award - Solicitation - Evaluation - Negotiation (usually) - Award Post-award - Performance of Work - Payment & Accounting - Modification - Closeout - Termination 25

26 Module 2: The Federal Acquisition Process Types of government solicitations Simplified Acquisitions and GPC Sealed Bidding (less) Negotiated Procurements (more) 26

27 Module 2: The Federal Acquisition Process Simplified Acquisitions Account for 90% of transactions Purchases less than $150 K $ value increases for contingency ops & defense/recovery from nuclear/bio/chem/radiological attacks The $6.5 mil exception expired end of 2011 $2k for Davis-Bacon and $2.5k for Service Contract Reserved for small business if purchase is >$3,000 Micro purchases less than $3,000 85% of Government purchasing actions 27

28 Module 2: The Federal Acquisition Process Sealed Bidding A rigid procurement process Not open to negotiation For non-commercial supplies or services greater than $150K Clear and detailed specifications generally Uncle tells you how to do it Awarded on price factors To responsive/responsible bidders only Being used less often today 28

29 Module 2: The Federal Acquisition Process Negotiated Procurements Most flexible but most complicated procurement Many forms 80% of contracts exceeding $100K Requests for Proposal (RFPs) Evaluation criteria cited in solicitation Contracting Officer (KO in DOD) may negotiate Preferred over Sealed Bids 29

30 Module 2: The Federal Acquisition Process Electronic Procurement Opportunities Examples: Federal Business Opportunities (FBO) is the electronic, government-wide portal for federal procurement opportunities that exceed $25,000 DLA Enterprise Support RFQ, RFP, and award postings from the Defense Supply Centers 30

31 Module 2: The Federal Acquisition Process Getting Paid Prompt Payment Act (FAR Subpart 32.9) Government invoice payment is the 30th day after the designated billing office receives a proper invoice from the contractor or receipt of goods or services, whichever is later (exceptions FAR ) Electronic funds Transfer (EFT) QuickPay Program directs Fed agencies to cut 30 days to 15 for small businesses 31

32 Module 2: The Federal Acquisition Process Purchase Card (P-Card) program Purchases of individual items under $3,000 or multiple items with an aggregate under $3,000 ($2,000 construction) are micro-purchases dollar limits can increase temporarily Micro-purchases do not require competitive bids or quotes, and agencies can simply pay using a Government Purchase Card (credit card), without the involvement of a procurement officer as long as the price is deemed fair and reasonable 32

33 Module 2: The Federal Acquisition Process GSA Schedules Program Method of simplified acquisition helps federal buyers purchase faster, easier, at lowest prices GSA establishes government-wide contracts with vendors to provide commercial supplies and services Generally 5 years with three 5 year option periods of indefinite delivery & indefinite quantity (IDIQ) Not a guarantee of sales! You must market your firm DOD has limitations on using GSA without a justification signed by a Flag Officer or equal 33

34 Small Business Training MODULE 3: Rules of the Road 34

35 Module 3: Rules of the Road Federal Contract Law Other Laws that Affect Contracting/ Dealing with Government Federal Acquisition Regulations (FAR) Agency Specific Regulations (DFARs, etc.) Your solicitation and contract 35

36 Module 3: Rules of the Road FAR (Brief Outline/ Highlights) Subchapter A General (Parts 1-4) Part 2 Definitions Part 3 Ethics/ Conflicts of Interest Subchapter B Competition (Parts 5-12) Part 6 Competition Requirements Part 8 Required Sources Part 9 Contractor Qualifications 36

37 Module 3: Rules of the Road Subchapter C - Contracting Methods and Contract Types (Parts 13-17) Simplified acquisition, sealed bidding, contract by negotiation, types of contracts, special contracting methods Subchapter D - Socioeconomic Programs (and other laws affecting contracts) Part 19 Small Business Program Labor laws, other laws, privacy, FOIA, Buy America, foreign acquisition, other special cat. programs 37

38 Module 3: Rules of the Road Subchapter E - General Contracting Requirements (Parts 27-33) Patents, data & copyrights, bonding, insurance, taxes, cost accounting standards, contract cost principals & procedures, contract financing, & protests, disputes and appeals. 38

39 Module 3: Rules of the Road Subchapter F - Special Categories of Contracting (Parts 34-41) Major system acquisition, R&D, construction / architects / engineering, service contracts, federal supply schedules, IT, & utilities Subchapter G - Contract Management (Parts 42-51) How relationship is managed Admin.&audit, modifications, subcontracting, Govt. property, QA, transportation, value engineering, termination, extraordinary actions, & use of govt. sources 39

40 Module 3: Rules of the Road Subchapter H Clauses & Forms Part 52 Solicitation Provisions and Contract Clauses Part 53 Forms 40

41 Module 3: Rules of the Road Other areas of interest Transfer of technology with foreigners Security clearances Government ethics/ conflicts of interest Making claims against the government 41

42 Module 3: Rules of the Road Requirements for government contracting and subcontracting The flow down requirements and/or statement of work in a prime contract may require the small business subcontractor to make organizational adjustments to reduce the risk of non-performance Examples: quality, accounting systems, security 42

43 Module 3: Rules of the Road Do I need a lawyer or other professional to understand this stuff? Probably not, but it depends Scale/ complexity of the deal The scope of what you are putting at risk You are required to perform or Uncle Sam can make you pay for us to get someone else to do it Be careful what you wish for Novelty of the deal Your PTAC is your best friend 43

44 Module 3: Rules of the Road Free vs. paid assistance You have free help out there, but it can realistically take you only so far. If successful, you need to purchase talent, either in-house or consultant. Be an educated consumer. 44

45 Small Business Training MODULE 4: Small Business Goals 45

46 Module 4: Small Business Goals Public Laws and their impact on small business A series of Public Laws govern the small business contracting goals of Federal agencies as well as the sub-contracting goals of prime contractors Commonly referred to as set-aside programs and subcontracting plans Reality: Goals are treated like requirements and are dependent on the availability of qualified small business firms 46

47 Module 4: Small Business Goals Socioeconomic Goals that Affect Competition (examples) Use small business (FAR Part 19) Pay prevailing wages (FAR Part 22.10) Provide employment opportunities for U.S. citizens (FAR Part 25) Equal employment opportunity (FAR Part 22.8) Maintain a drug-free workplace (FAR Part 23.5) Provide preferences for veterans (FAR Part 22.13) Provide handicapped accessibility (FAR Part 22.14) 47

48 Module 4: Small Business Goals Government agency, prime contractor, and small business relationships Large prime contractors with contracts > $650K ($1.5 mil construction) are required to submit small business subcontracting plans to the Government (FAR ) Prime contractors negotiate goals in those plans and are monitored by review of bi-annual reports in esrs (formerly SF294/SF295 hard copy forms) No privity of contract exists between the subcontractor and the buying agency 48

49 Module 4: Small Business Goals Preferences for small business Small businesses in certain categories can receive some preference as a prime contractor, when the small business capability meets the procurement requirements identified in the solicitation Preference programs are not entitlements Small businesses help Government agencies and prime contractors meet their small business goals 49

50 Federal Government Small Business Contracting Goals Small Business 23% Women Owned SB 5% HUBZone 3% SDB (note Rothe ) 5% 8a (note DOD) 5% Service Disabled Vet 3% 25% 20% 15% 10% 5% 0% Sm all B usiness Sm all B usiness W omen O wned H UBZone SDB 8a Service Disabled 50

51 Module 4: Small Business Goals How does a small business market itself to the agencies and prime contractors? All Government agencies and large business primes have goals to be met, but Your SB category should not be the primary focus of your marketing pitch Your SB category may help get you in the door but Your ability to perform is most important SB perference programs are not entitlements 51

52 Small Business Training Module 5: The Government Solicitation 52

53 Module 5: The Government Solicitation Solicitation/Contract elements UCF = Uniform Contract Format A. Solicitation/Contract Form B. Prices/Costs C. Specifications/Statement of Work D. Packaging & Marking E. Inspection & Acceptance F. Deliveries or Performance G. Contract Administration Data H. Special Contract Requirements I. Contract Clauses J. List of Attachments K. Representations, Certifications L. Instructions to Offeror M. Evaluation Factors for Award 53

54 Module 5: The Government Solicitation Successful Proposals Responsive, all elements of the solicitation addressed and followed Responsible demonstrates capability Competitive pricing Organized and concise (award is not based on weight of your proposal ) 54

55 Module 5: The Government Solicitation Evaluate your proposal (PTAC can help) Meets all elements of the solicitation? Supporting documentation is available? All certifications and required documents are signed and included? Submitted in accordance with solicitation instructions and evaluation criteria? Does your program plan meet the requirements and is it executable? 55

56 Module 5: The Government Solicitation Resources for Small Business PTACs ( Prime Contractors SBLOs Federal Agency Small Business Specialists ( US Small Business Administration SBDC or state level equivalent 56

57 Small Business Training Module 6: Marketing to Federal Agencies and Prime Contractors 57

58 Module 6: Marketing to Federal Agencies and Prime Contractors Preparing to market to federal agencies and prime contractors Obtain a D&B DUNS (Data Universal Numbering System) number Register in CCR (Central Contractor Registration) Register in the Small Business database in CCR; select the SBA logo on last screen in CCR to ensure you get into the other database Determine correct NAICS (North American Industry Classification System) code 58

59 Module 6: Marketing to Federal Agencies and Prime Contractors Identifying potential customers Visit Fedbizopps at Visit subnet at Contact local PTAC, SBA, SBDC Research Federal agency websites Research past awards Contact prime contractors for subcontracting opportunities Attend outreach events Attend Matchmaker events 59

60 Module 6: Marketing to Federal Agencies and Prime Contractors Small Business Research & Development Programs ($$) Small Business Innovative Research (SBIR) programs Small Business Technology Transfer (STTR) program Defense Advanced Research Projects Agency (DARPA) Broad Agency Announcements (BAA) Other Federal agencies R&D programs 60

61 Module 6: Marketing to Federal Agencies and Prime Contractors GSA General Services Administration Expedited procurement system developed by GSA and used by many Federal agencies for the procurement of goods and services (State agencies may use for Information Technology) Acquisition priority over full solicitation when applicable For more information: GSA Atlanta at

62 Module 6: Marketing to Federal Agencies and Prime Contractors Is the Federal agency or prime contractor really your customer? Do research to determine the following: Are your products/services being purchased by Federal agencies or prime contractors? Are you able to compete profitably? Do you understand Government contracting procedures? Is the pace of Government contracting compatible with your business plan? Can a preference program benefit you? 62

63 Module 6: Marketing to DOD and DOD Prime Contractors Summary Contact your local PTAC Identify your target agencies and contact the Small Business Specialist Contact prime contractor SBLOs (Small Business Liaison Officers) Learn about small business and federal contracting on Attend Matchmaker and Outreach events Be persistent in your follow-ups 63

64 Important Information The material presented in this training and the advice given by the trainer are intended to give you things to think about as you prepare to be a government contractor. The materials are not intended to be a substitute for the actual laws, regulations, procedures, policy and directions governing your relationship and conduct with the government or its contractors or agents. Not only are things subject to constant revision, they may also be subject to interpretation that only a competent authority or professional can provide. Do not rely on this presentation as an authority. Please read the most current law, regulation, procedure, policy, direction or contract language and if there is any question as to what it means, seek clarification from a competent authority in the government or seek the help of a competent professional. *Nothing in this presentation should be construed as a guarantee of a contract award. 64

65 This training was brought to you by: The US Department of Defense Southeast Region Council for Small Business Education and Advocacy 65

66 For a copy of this, to ask a question about a slide, or ask for more information send an to: william.d.cantrell@us.army.mil Chair, DOD SE Region Small Business Council 66