Tag: private sector contracting

Government Programs to Help Small Businesses Export Products and Services to Foreign Markets!

Posted on by Eric Coffie

Export excellence with these government programs to help small businesses export products and services to foreign markets!

EXPORTING FOR SMALL BUSINESSES

American-made products are respected and coveted around the world and exporting goods and services to other countries is good for the United States economy and to all small businesses. 

However, while large businesses often have the experienced staff to successfully export their products or services, small businesses need extra guidance and support in order to understand the complexities of exporting successfully.

This is why it’s no surprise that governments at all levels pitch in to help small businesses in the US.

In fact, the departments within the federal government, especially the  Department of Commerce and the Small Business Administration (SBA), participate in enabling small businesses to bring products and services to foreign markets.

With this, the best place to start is at the International Trade Administration’s Export Solutions, a portal that pulls together the resources from 19 federal agencies that help businesses with exporting.

EXPORT EXCELLENCE!

1. Learn how to export.

If you want to compete on the world stage, you will need to learn the ins and outs of successful exporting.

You can do this through the SBA’s growing library of videos, podcasts, online courses, and other resources. Learn how to do your international market research now!

2. Understand the complex world of exporting.

Every country has their own licensing and standards requirements. Finding the right licenses and adhering to the right standards will ensure a successful exporting business. 

With this, the International Trade Administration’s Export Solutions provides a convenient landing page that outlines licenses, standards, sanctions, and training that exporters need to navigate through the international market.

3. Understand the market.

The United States Department of Commerce has an International Trade Administration that performs market research.

They provide over 100,000 industry and country-specific market research reports for US-based companies registered on their Export Solutions portal.

4. Find and connect with partners and buyers.

Through a variety of programs offered by the US Department of Commerce, small businesses can find potential customers through a Trade Leads program, receive trade fair certification to appear in foreign trade shows, search for partners, and meet foreign buyers in US trade shows.

5. Manage your financials.

It costs money to initiate an exporting business. With this, the SBA offers 3 loan guarantee programs:

  • The Export Express Program streamlines the lending process and backs up to 90% of a loan from a lender so small businesses can borrow up to $250,000 to fund a variety of exporting initiatives.
  • The Export Working Capital Program guarantees lenders up to $1.5 million of a $2 million loan so exporters have a working capital to fund the various costs required in exporting.
  • The Trade Loan program guarantees lenders up to $1.5 million of a $2 million loan so exporters can start exporting or become more competitive if they have been adversely affected by imports.

Get more information about these finance programs (including the temporary 2009 Recovery Act fee waiver) at the SBA’s website.

Apart from that, you can also check these organizations for financial solutions:

With all of these, there are also other insurance products that include multi-buyer policies, short-term policies, and political risk policies, depending on the destination and type of exporting transaction. If you want to learn more about this, visit this link.

THINGS TO CONSIDER

Note: The resources listed above are for federal government exporting use only.

Most states provide their own additional resources to help companies within their state export to the international stage. Be sure to Google the name of your state plus “export assistance” or visit your state’s government website for export guidance.With this in mind, if you want to learn more about doing business with the US government around the globe, then join us here at GovCon Giants. Just visit our website and other social media platforms or check the new GovCon Edu where you learn everything about government contracting!

Public Sector Contracting versus Private Sector Contracting

Posted on by Eric Coffie

Here’s an outline of the key differences in dealing with contracts between the federal government or the public sector and the private sector. 

FINDING CONTRACTS

The federal government typically operates procurements through the System for Awards Management and the Acquisition Central which centralizes several acquisition and procurement activities. 

Meanwhile in the private sector, some larger companies centralize procurement, but most deal with it in a decentralized way at a regional or departmental level.

GETTING THE CONTRACT

To ensure fairness, maintain high standards, and deliver value to the US taxpayers, the federal government has a strict procurement process in place.

Contractors need to send a proposal in response to a Request for Proposal (RFP) posted on a procurement site. Then, the Contracting Officer is typically delegated the full buying authority necessary to make the purchase in federal government buying decisions. 

Federal government services are less sensitive to the economy simply because taxes are collected regardless of economic conditions, however, businesses need to qualify, even annually, in order to maintain a position of “good standing” as a government service provider. 

On the other hand, private sector contracting varies dramatically and can often be accomplished through personal connections rather than sales effort because the contracts are highly sensitive to shareholder influence.

Private sector contracting might be sold through any number of sales techniques from cold-calling to sales presentations. Contractors may even frequently require the sign-off of higher levels of authority, each who need to be “sold” on the product or service.

Hence, in the private sector, a business’ track record and contract may be enough to acquire business, but in doing business with the government, qualification differs, depending on the agency served and the products or services delivered.

ENGAGING ON THE CONTRACT

Federal government agencies are often highly bureaucratic, so each agency carefully manages its own “jurisdiction”. As a result, private sector contractors transitioning in the public sector are sometimes surprised to discover just how “political” and “pigeon-holed” their works were.

Then, in terms of the successful completion of a project, in the private sector, contracts are considered complete based on performance-enhancing or bottom-line-enhancing Key Performance Indicators (KPIs).

On the other hand, the federal government may be occasionally cost sensitive during the selection of their service provider, but their KPIs are typically not tied to performance or the bottom line. Rather, they are tied to time, budget, measurable completion of the project, or some other indicator.

MAKING MONEY

Margins are usually higher in the private sector since the federal government rewards work to the lowest bidder. However, change orders and longer-term contracts make federal government work lucrative to companies that are able to work within the margins.

Payment is also different between these two sectors. Due to bureaucracy and pre-established systems, businesses can expect longer timelines on payment (1-6 months) from the government compared to the private sector where a 30-day payment schedule is typical.

SUMMARY

Breaking into the federal contracting marketplace isn’t always easy to do as it requires careful adherence to the pre-established process as well as creative navigation of the bureaucracy. However, companies that can establish connections as government contractors usually enjoy long-lasting opportunities.

With this in mind, if you want to learn more about doing business with the government or anything about doing government contracting, then join us here at GovCon Giants.

Just visit our website and other social media platforms or check the new GovCon Edu where you learn everything about government contracting!