Products Partners Blogs Contact Let's talk What to Consider When Applying for a Government Contract Nov 23, 2021 Did you know the US government spent more than $680 billion on contracts in fiscal 2020? This is the highest contractual spending by the federal government on record. Securing a government contract can have a tremendous impact on your business growth. In fact, the government can become the best clients you've ever had business with. Government contracts have many benefits. They range from good pay, reliable income, long contracts to high business value. However, securing a government contract is easier said then done. There are lots of regulations, procedures and rules dictating how to transact with the government. Your business must navigate through the complex bidding process and pass. Don't forget the stiff competition with many businesses seeking a healthy revenue stream. While there are many hurdles, it doesn't imply your business can't win the bid. But are there considerations to make when applying for a government contract? Keep reading to find out. Know the Types of Contracts Before getting started, know the different types of government contracts. Different types will have different requirements. For the federal government, the main types are cost reimbursement and fixed-price contracts. In cost-reimbursement contracts, there's the determination of total allowable costs after the project completion. The contractor gives the estimated total costs before the contract starts. This becomes the ceiling beyond which final costs should not exceed. In fixed-price contracts, the contractor provides services or supplies for a specific price. The set price is non-adjustable based on costs incurred by the contractor. Others include letter contracts, incentive contracts, time-and-materials contracts and indefinite-delivery contracts. The type of contract will vary according to the timing and degree of risk assumed by the contractor. And the nature of profits the contractor will get for achieving expected standards. Before you get started, understand the available types of contracts. This will guide you on how the contract will affect your business, the benefits and drawbacks. Check Your Business Performance While the federal government offers a wide variety of contracts, you can't bid in any field. The government requires contractors to be experts in the field they are bidding. This guarantees quality and efficiency in offered supplies or services. When pursuing a contract, be an expert in that field. For instance, you must prove your expertise in the field. This should happen if you are bidding for the construction contract. It would help if you showed the previous infrastructure works completed and related to your bid. The best thing is, there is almost something for everyone. As far as you are carrying out a legit business, the government needs your services or supplies. If you've been a government contractor, they check your past contract performance. Check on Contract Requirements Different government contracts will have varied requirements. It's important that before bidding, read through the solicitation with a critical eye. Get every detail, terms and condition that you should fulfill. For instance, some contracts need a business to sustain itself until after payment. Again, the requirements vary depending on the contract, and you want to be sure you can fulfill them. When it's your first time, the details in solicitation documents can be overwhelming. You may want to find an advisor who can elaborate or make you understand what they mean. Government Auditing Do you know bidding will involve business audits and investigations? Government auditors scrutinize books of account as per the firm, federal standards. Also, some contracts warrant an audit by Defense Contracting Audit Agency. Recently, financial scrutiny in government contracts has been more intense. This is to ensure compliance with financial reporting standards. Are you thinking of applying for a government contract? Consider finding the right professional to get you ready. To get yourself started in government auditing, you may consider attending a seminar. You get trained about government auditing in the contracting process. Invoicing and Payment Terms Government contracts differ when compared to other standard contracts. One of the key differentiators with government contracts is invoicing and payment. Remember any mistakes in invoicing can result in further delays. Also, some contracts have special invoicing requirements. This includes where the contract requires that you keep your funding on track. After reaching 75%, they need the contractor to notify the government failure to which penalties occur. Read the contract and understand every responsibility you have as a contractor. Also, if you win a government contract, don't forget certified payroll reporting. This involves accounting for everything paid to the employees when working on a government contract. Certified payroll reports can be a very time-consuming and laborious task. The Department of Labor reports that on average, it will take companies 55 minutes to complete one report. They must be submitted on a weekly basis to ensure that all workers are not being paid less than the proper Davis-Bacon prevailing wage rate for work completed. Both contractors and subcontractors file the reports, and the government assumes the oversight role. The authorities verify that workers involved in the contract are fairly paid with respect to the prevailing wages. Liability Insurance Do you have liability insurance for your business? If you don't, you may not qualify for some contracts. Most government contracts will need contractors to have liability insurance. But, check the required type of insurance coverage when applying for the contract. Time and Resources As a business owner, you will spend hours and resources to seek and manage government contracts. For instance, in federal contracts, you need to complete many certifications and representations. These range from accounting rules, environmental standards and even compliance to business size. The documents ensure compliance with the set regulations and laws in government contracting. They form the most detailed part of the bidding process that consumes a lot of time and resources. There are legal implications to this. This is despite the lots of time you spend completing the paperwork. First-time applicants should seek professional help when pursuing a government contract. This relieves your stress and pressure as you have someone to guide you through. Consider the Above Factors When Applying for a Government Contract Government contracting is a huge task that takes lots of time and resources to complete. Also, applying for government contracts doesn't guarantee you'll get it. But, checking requirements before pursuing a government contract increase your winning odds. The above considerations are necessary when you are applying for a government contract. Are you looking for a certified payroll reporting provider? At Points North, we are here to help. We pride ourselves on years of experience to offer clients compliance reporting. We also offer data aggregation solutions. Build and manage a better workforce with integrated HR solutions from ADP Marketplace partners like Points North. < Older Post Certified Payroll Reporting LEARN MORE ACA Reporting LEARN MORE Payroll Data Aggregation LEARN MORE Attendance Advisor LEARN MORE There will be no additional extensions for ACA reporting in 2022 Employers should make sure they and their service providers are ready to give employees with health care reporting forms and submit them to the IRS on time, according to the IRS. Deadline extensions will not be granted for 2022. The ACA requires large applicable employers (ALEs) to submit reporting forms to the IRS and distribute them to workers. OPEN ENROLLMENT FOR 2022 PLAN YEAR HAVE BEGUN The 2022 federal open enrollment period began last week and will continue until January 15, 2022. Consumers will be able to pick from a number of plans, as well as lower prices. According to a news release from the Centers for Medicare and Medicaid Services (CMS), there will be 213 participating insurers selling plans for 2022 year. We'll find the right solution for you. We'll help you decide on the best solution for your company. Simply click the button below to fill out a form or just give us a call today. Message Us Or Call Us Directly CONTACT US 888.561.2072 218.726.1195 218.726.0893 (Fax) info@points-north.com sales@points-north.com support@points-north.com careers@points-north.com 371 Canal Park Dr #210, Duluth, MN 55802 USEFUL LINKS Home About Products Partners Blogs Contact FOLLOW US © 2021 All Rights Reserved | Powered by AutomationLinks | Privacy Policy