Small Business Bidding 101: How to Start the New Year with a Bang

It’s that time of year again when small business owners set their sights on new goals for the months ahead. Are you looking for ways to get your name out there? Grow your customer base? Or expand into new verticals?

If that’s the case, bidding on government opportunities is a great way to take your business to the next level. While the process may feel intimidating, it’s actually easier than you think to throw your hat into the ring as a government contractor.

Whether you’re a first-time bidder or familiar with government bidding, in this post, we’re breaking down everything you need to know to put your best foot forward and set your business up for success in 2023.

Opportunities for small and disadvantaged businesses

Did you know that one out of every 10 dollars of federal government spending goes to suppliers? The U.S. government is the world’s largest customer. And governments across both Canada and the U.S., at the local, state, and federal levels, post 200,000+ bid opportunities on Bonfire each year.

Government projects run the gamut from IT to construction to consulting services and beyond — and, much of the time, agencies struggle to find the right supplier for the job. Not only are they looking to expand their network to include more qualified suppliers, but thanks to new federal requirements, they’re looking to award a significant percentage (at least 10%) of contracting dollars specifically to small or disadvantaged businesses.

Understanding small business contracting rules and requirements

Unfortunately, the rigorous nature of public sector procurement policies deters many small businesses from bidding on government opportunities. Governments are accountable to taxpayers, so it makes sense that they’re required to follow stringent rules about how to purchase products and services. They need to ensure fairness in the process, competitive pricing, legality, and optimal outcomes for constituents.

To help you get started, here are the top things to keep in mind as a small business when it comes to government contracting rules and requirements. The U.S. Small Business Administration (SBA) contracting guide and Government of Canada procurement guide also offer a wealth of information on this topic.

Small business qualification

To compete on U.S. federal government opportunities for small businesses, whether as a prime contractor or subcontractor, your business needs to meet specific size standards set out by the SBA. If you qualify and meet all of the other basic requirements, you can register as a government contractor and start bidding on government opportunities using Bonfire Premium Vendor right away. 

Contracting assistance programs

The U.S. government has a range of programs in place to support historically disadvantaged small businesses, including women-owned, minority-owned, and veteran-owned businesses, as well as HUBZone program participants. In addition, the 8(a) Business Development program supports socially and economically disadvantaged small business owners. If you’re eligible to join this program, you can get access to mentorship, training, and technical assistance designed to give you more equitable access to federal contracting opportunities.

The Canadian federal government also offers programs and services for businesses to support your participation in public sector bid opportunities.

Legal regulations for federal contracting

Before you decide to participate in government contracting, you’ll want to familiarize yourself with all the laws and regulations your small business needs to comply with. The U.S. federal government’s purchasing process is governed by the Federal Acquisition Regulation and there are specific rules related to small businesses. Other regulations you need to follow as a government contractor include the Buy American Act, the Trade Agreements Act, relevant labor standards (Service Contract Act, Contract Work Hours, Safety Standards Act, etc.), and more. 

The Canadian government also follows its own procurement policies and guidelines.

Manufacturing rules

If your small business is looking to supply goods to a U.S. government agency, federal procurement laws require you to perform at least 50% of the cost of manufacturing the items. However, it’s a good idea to familiarize yourself with the non-manufacturer rule. Under that policy, you may be allowed to supply products manufactured by another small business, and this rule may be waived if no small businesses manufacturers are available.

Subcontracting limits

To pursue a U.S. federal contracting opportunity, you may need to partner with a subcontractor to complete the work. If you plan to go this route, be sure to familiarize yourself with the subcontracting limits for small businesses. These award conditions are in place to prevent ineligible businesses from using small or disadvantaged businesses as a way to access set-aside contracts. Depending on the nature of the work, the small business prime contractor must perform anywhere from 15-50% of the cost of the contract.

Other requirements

Depending on the government agency you’re planning to work with, there may be other certifications, insurance policies, or requirements you need to meet to begin bidding on projects. You can get a sense of these requirements by reading over the bid documents for the projects that match your business. For example, if you’re looking to contract with the U.S. Department of Defense (DoD), you’ll need to meet their cybersecurity requirements (learn more at Project Spectrum).

Start Bidding Today

There are more opportunities than ever for small and disadvantaged businesses to win lucrative government contracts and nurture lasting relationships with public sector agencies across North America.

Are you ready to gain access to over 200,000 new government opportunities — and bid on the best ones to grow your business this year? Join Bonfire Premium Vendor today to start bidding immediately and unlock growth for your business overnight. And, if you’re looking for more information on bidding best practices and programs available to support small businesses, check out our latest e-book, The Ultimate Guide to Government Bidding Online