Work for Uncle Sam

I don't mean give up your business and try to land a job with the US government or the local government. Rather, I'm encouraging you to look into bidding for government contracts. On top of that, the federal government wants to award almost a fourth of its contracts to small businesses especially those that are minority-owned and women-owned businesses. Plus, the government has over $500 billion worth of contracts available as a result of the stimulus package.

According to the Wall Street Journal, the government has awarded $8.1 billion contracts with $1.9 going to small businesses. States and local governments don't necessarily share the goal of awarding 25 percent of contracts to small businesses, or perhaps, they are aiming higher. So look to your state and local government for opportunities.

The Reality of Government Contracts

You might be seeing dollar signs and a healthy cash flow, but also prepare to do a lot of paperwork. The government has to follow a process to keep the contract process fair. So businesses need to write up a proposal that responds to the government's request for proposal (RFP).

Once you get signed up and do a bid or two, you might decide to make pursuing government contracts your business' source of income. Many small businesses don't have the resources or time to invest into government contract bidding. Those who are minority-owned, women-owned, veteran-owned or a disadvantaged business (this is a business owned by someone who is socially and economically disadvantaged) would have a better chance than other small businesses.

Established businesses with a full load of clients may not want to pursue this. Government contracts might be ideal for the aforementioned businesses that are just starting out, don't have many clients or want to see the business grow.

Going for the Government Contract

You won't find all opportunities in one place especially since local, state and federal government aren't tied. One place to go for federal contract opportunities is www.FedBizOpps.gov and others listed. The US Small Business Administration explains the steps to looking for opportunities and applying for them.

A few more resources:

• www.recovery.gov: Official government site for stimulus package information.
• www.recovery.com: Breaks out contracting opportunities by states.
• www.usaspending.gov: Information on government spending.
• www.agc.org/recovery: Information for general contractors and construction businesses.

Be sure to update all your business plans and goals if you decide to focus on government contracts. You may need extra resources and working capital to get started, so you want to be ready to make your case for a loan or other source of funding.