IMAGINE YOUR SMALL BUSINESS losing millions of dollars in lucrative contracts, paying heavy fines, or even being prohibited from selling to your largest customer—all for violating rules you didn’t know existed. It sounds like a nightmare, but when it comes to doing business with the federal government, it is a reality countless small business owners face.
If Uncle Sam is one of your small business’s customers, you’re not alone. The federal government spends $500 billion annually to buy goods and services from contractors, and thanks to special rules requiring agencies to award contracts to small businesses, nearly a quarter of those procurement dollars go to small companies. Contracting with the government can be lucrative—but if you don’t know the key rules and regulations, it can also be very risky.
When the government is your customer, you must learn a whole new rulebook, very different from the one you may be used to in the commercial marketplace. It’s a big rulebook—thousands of pages of dense text, spread out over a hodgepodge of federal statutes and regulations. And, as counterintuitive as it sounds, the rules are actually more complex for small businesses than for large companies. Not only does your small business have to follow most of the same government contracting regulations as big players such as Boeing, Lockheed, and IBM, but you must also obey a special set of regulations that apply only to small business contractors.
Of course, behemoths like Boeing have in-house legal departments to help them navigate their way through the regulatory maze.