Selling to the government with Jane Stewart

Summary:

The federal government spends over $600 BILLION every year on goods and services. 23% of those purchases are set aside for small businesses!

PTAC can help determine if the government buys what you have to offer then guide you through the federal procurement process. PTAC is funded by the Department of Defense to provide FREE government contracting assistance to small businesses.

Jane Stewart has been with the PTAC program for 22 years and is a Level 3 Certified Procurement Professional through the Association of Procurement Technical Assistance Centers.

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Transcript of Biz Chat Ohio’s podcast 2.10: Jane Stewart

Hello, everyone. Welcome to BizChat Ohio, the podcast bringing you big ideas for small businesses, and the best of small business news and industry trends from Ohio’s thought leaders. This podcast is made possible by Lakeland Community College and the Ohio Small Business Development Center. I’m your host, Cathy Walsh, director of the Small Business Development Center. And I’m joined by my co-host Gretchen Skok Disanto, director of the Lakeland Community College Entrepreneurship Center, and business advisor for the Ohio Small Business Development Center.

Hi, everybody. I started working with small businesses in Northeast Ohio 25 years ago. And I immediately was amazed by how many programs exist in Ohio to help businesses grow. Yet the vast majority of small businesses aren’t aware of those programs. One of our go to programs here at the Small Business Development Center is the Procurement Technical Assistance Center, which is also referred to as PTAC. And the team at PTAC helps businesses who are looking to sell to the government. Now as you all can imagine, the government buys all types of goods and services from businesses each year.

So for many businesses, pursuing government contracts is an excellent growth strategy. Plus the great thing about working with the government is it always pays its bills. Now, it may not pay in a week, but it always pays its bills. Our guest today is well recognized government contract expert. And I’ll turn everything over now to Cathy to introduce her.

Yeah thanks, Gretchen. So as Gretchen mentioned, the federal government is an excellent prospective customer for small businesses, and it spends over $600 billion with a B billion every year on goods and services. 23% of those purchases are set aside for small businesses. Our guest today is Jane Stewart, who has been with the PTAC program for 22 years, and is a level 3 certified procurement professional through the Association of Procurement Technical Assistance Centers. PTAC can help determine if the government buys what you have to offer, and then they can guide you through the federal procurement process.

PTAC is funded by the Department of Defense to provide free government contracting assistance to small businesses. Welcome Jane. Thanks for joining us today.

Thank you so much. I appreciate the invitation. I’m happy to be here.

So I think most people think of contracting out to the government as something for bigger companies or very select industries. But how available is government contracting for the average entrepreneur or small business owner? Well like you mentioned, the government buys practically everything. I have seen government contracts for everything from very high tech computer or weapons system all the way down to I recently saw a solicitation put out looking for pheasant eggs.

Pheasant eggs?

Pheasant eggs, yes. So and everything in between. I think that was with the Department of Interior the parks services. Or something but 23% of all government contracts are set aside for small businesses. That’s a huge amount. And then within that, there are additional goals that every agency has to award contracts to 8A certified businesses, women owned businesses, HUBZone, and service disabled veteran owned. So there is opportunity. And in addition to the federal government having those goals, the big prime contractors also have similar goals to award to small business.

So there’s definitely opportunity.

Can you tell us really quick what is 8A certified? You mentioned that.

I’m sorry, the government is full of acronyms. The 8A program is a socioeconomic business development program that is managed by the Small Business Administration. And 5% of government contracts are set aside for the 8A program. I also mentioned HUBZone. HUBZone is based on the location of the business. And that’s also an SBA program.

So if anybody wants to know more about any of those programs or see if they fit, they can certainly get a hold of you or one of your counterparts, and get that additional information, right?

Absolutely. We can help through the entire certification application process.

I’ve got another question. So when we’re talking small business, does PTAC define that as 500 employees or less? Is that how that works with those 23% set asides?

It depends. The SBA, the Small Business Administration, are actually the ones who determine business size. And those are just defined by the NAICS codes, the North American Industrial Classification codes. Generally speaking, manufacturing businesses go by the number of employees. Generally, it’s 500 employees or less is a small business. A service provider such as a construction company and IT company, those are determined by annual revenues. And that varies anywhere from about $6 million in annual revenues up to $35 and $30 million.

Let’s say I’m a small business, I fit the parameters for doing business under those what we just discussed. How do I begin selling to the government? Well, first of all, you want to contact your local PTAC office, and then we can help you through the entire process. We have various market research tools where we can identify what government agencies have purchased the product or service the company offers. We can find out how frequently they make the buy, at what price, and who the competition is. Once we determine that there is a fit for the business and government contracting, there are a couple of requirements.

One of them is the System for Award Management, or SAM. SAM is a vendor registration that is the absolute requirement for all companies wanting to do business with the government. SAM will assign you what’s called a cade code, as well as your unique entity identifier. Those two items are the absolute requirement for government contracting. You cannot be awarded a contract or get paid for a government contract without an active SAM registration. Then after going through the SAM registration, we can help to develop a marketing plan.

We always encourage our clients to create a capability statement, which is essentially a one page resume of the company who they are, what they are, what they do, how they do it, who they’ve done it for, and why I should do business with you. Then once the company has a good strong capability statement, we can start to make a plan on getting it distributed, identifying the agencies that could be potential customers, and help them come up with the plan to do some effective marketing. We can also identify how a particular agency buys. Some agencies put out open procurements on a regular basis.

Others prefer to do their purchasing through the GSA multiple award schedule, or some other, they’re called GWACs, just be Government Wide Acquisition Contracts. So we can help identify if any of those are relevant for a particular business, and then we can help them obtain those contracting vehicles.

OK so it sounds like you can help determine if anybody’s looking for my product or service, correct? Like if I’m a small business owner, you will help me even determine if it’s possible or needed. And how do I know what to charge? Are there guidelines for that or do you offer help for that?

Well, that’s probably the one thing that we can’t really tell a company is how to price their product. A business has to know what their costs are, what their overhead, their long term costs, short term costs. When companies need help with their financials and helping to determine pricing, I generally send them to the SPDC for that type of assistance.

I mentioned earlier that I think one great thing about doing business with the government is I don’t think you’re going to have to track them down month after month to get payment. They will pay. But there are some folks that say, hey, it takes forever. What are your thoughts on that? Is that true or is that just a urban legend or myth out there?

Well, there certainly are a lot of urban legends where it comes with our government. But no, the government will pay within 30 days. They are required by law to pay after a correct invoice that’s received. If payment is not made within 30 days, they will pay interest. And I’ve had clients who have received interest. I mean, it’s not a huge amount, but every little bit helps.

I guess maybe another myth that we need to dispel would be that working with the government is just too hard. There’s so much paperwork. There’s so much more work. It’s so demanding. Or the amounts of product they want are just so huge I’ll never be able to comply with that. Do any of these sometimes fall true, or are these myths as well that working with the government is just too hard and it’s too confusing?

Well, it is hard. But then again being in business is hard. I don’t think it is any more difficult to deal with the federal government than it is dealing with any of the large prime contractors, like Boeing or Lockheed Martin. There is a learning curve. The good thing about government contracting is everything is laid out for you. Every clause in the solicitation document will indicate exactly what is expected. There are no surprises.

You have to maintain an adequate accounting system in case that you do receive an audit. Not all companies receive a government audit. That’s going to be for more specific types of government contracting, like a cost plus contract where all of the pricing details have to comply with the requirements. There are military standards and specifications that manufacturers have to comply with. And you have to remember where those are concerned, the lives of our service members are relying on the quality of product that a company provides.

It is difficult but there is an awful lot of help and guidance that is available at absolutely no cost to any small business.

I just want to talk a little bit more about your services. Earlier you talked about how you will help businesses, you establish the accounts they need, for example you know account SAM. You’ll help them with their capability statement, with marketing research, all of that. Is there anything else that you provide out of your center? For example, if I remember correctly you help folks receive certifications, like minority certifications and such. So maybe could you tell us a little bit more about that and anything else that you think our listeners should know about today with regards to the services out of PTAC.

Well we can help with all of the various certification programs. We can help identify which programs a company is a fit for, which ones they qualify for. Every level of government has their own certification programs so we can help figure out which ones would be the most beneficial to a particular business. Then once we’ve identified those, then we can help through the application process. We are not involved in the actual certification but we can help with the application. I think one of the most important services that we provide is our daily bid matching. The daily bids, every day, our clients receive email notifications of opportunities that hopefully are a fit for their company.

We put together a list of keywords, NAICS codes, federal supply codes, and anything else we can think of. And then based on that search criteria, it searched against all of the open procurements that are out there on a federal, state, and local level. Every bit is different. Every agency does their buying a little bit differently. So we take a real hands-on approach, and we can help through the entire process. And then hopefully we’ll get to celebrate with our clients after they receive an award.

Speaking of celebration, could you tell us one or two success stories that you’ve worked on. And I know you’ve been along there a long time, so you probably have far too many to talk about, Gene. But I can tick off the top of my head I know some wonderful businesses you’ve worked with. So would you mind sharing one or two?

Sure. Probably my favorite success story is a small company in Geneva, Ohio that I assisted. And this was quite a few years to go. The company was called Nordic Air, and they manufactured environmental control units, air conditioners, and heating units. They found their first government contract through our daily bid notices, and we helped them through the proposal process and they got the award. Well unfortunately, the units that were made failed in the field, not because of anything that Nordic Air did, simply because that unit was not meant to be in Iraq and Afghanistan.

So when the units started having problems, they came back to Nordic Air, and the owner had a wonderful can do attitude, and they re-engineered those units so they could meet the harsh conditions. And the new units were fabulous. They performed exactly how they needed to perform in that environment. So then they got another contract. And we’re talking like a $30-$40 million contract. When I first started working with them, I think they had 22 employees. And then they after several expansions, they ended up with over 200 employees.

The Marine Corps, who was the buying activity for these environmental control units, they wanted the products to be on GSA schedule, the General Services Administration schedules. GSA is sort of like the amazon.com for the government world. They had gone to a consultant to get them on GSA schedules and it was rejected twice. After that, the person I worked with, Bill, he was getting very frustrated. So at that point, I had never done an entire GSA schedule. I offered to do it, got approved the first time through. And that GSA schedule added to their sales because they had all of the accessories, all of the replacement parts on their schedules so any Marine Corps buyer could go to GSA website, fill up their shopping cart with what they needed, and they were done.

It’s a very fast and efficient way to buy. Unfortunately, or fortunately depending on your perspective, the owner eventually sold Nordic Air, and now it is HPT, which is a large company. But I always like to claim that as my best success story.

Well the owners are probably very grateful for your assistance in helping them grow their business, make it a wildly successful business, and then they were able to step away probably at their choosing. So that’s awesome. Awesome for them.

And they were great people to work with, and I’m looking for the next one. The next one will come along. But we help all types of businesses. And last year the Ohio PTAC, our clients were awarded almost $1 billion in government contracts. That is huge.

That’s a lot of revenue for the state.

Right I mean, some companies somewhere are getting these government contracts. So why not try to bring all of that right here in our own backyard?

One thing I’m thinking about too, I know you also help people who are service businesses and they may not be the things we typically think of. Like you’re talking about with Nordic air or even pheasant eggs, that’s a product. But can you give us a couple of examples of services that businesses have sold to the government?

Sure, janitorial services. Buildings have to get cleaned and maintained. IT services. A lot of IT is not done internally and it will be outsourced. Repair, repair of vehicles. Many facilities will have a fleet of cars for the staff. Well, they don’t maintain the vehicles. That’s outsourced. There are many, many services that the government will buy. Tree trimming services. I have a company who does tree trimming.

The only services that they don’t really buy are like personal type services, hair salons, nail salons, that type of thing. But pretty much anything else, there’s probably a market for it.

One other thing I know some of the clients that maybe we’ve referred to or we’ve worked in conjunction with, I know that the government does prefer that businesses have been in business and have a track record of at least a couple of years. But I know there’s exceptions to that as well. So can you just talk about the businesses background and how that works as far as getting into the contracts.

Well I think the most important thing is that they do have some past performance. The government wants to know that you have provided the product or service previously, that you’ve successfully provided it, and because that will be an indication that you can provide it for the government buyer. Being in business the length of time isn’t nearly as important as the quality of your business. Show that you have a proven track record.

Does the government ever require background checks or credit checks? Is that ever part of the process?

Background checks can be required when the work is done in a government facility. Every employee in your company will have to go through a background check. Credit checks, not so much. Unless it’s a very large contract and they might do a pre award audit to make sure that the company has the resources. Construction, bonding is required just like in the commercial world.

If any of our listeners are interested in finding out more about your programs, your certification, assistance, whether or not they’re a fit, how do they find you? Or how do they find the PTAC here locally in Ohio?

Well you can go to my website. My website is PTAC.Ohio.edu. on our website, you’ll find a map where all of our PTAC offices are located. We have nine in the state of Ohio. You’ll also see our client registration form. You can fill out our client registration, and then the appropriate counselor in your area will receive it, and that will get the ball rolling. Once we have that will reach out to schedule a meeting and determine how we can best help your company.

And I want our listeners to know that we’ve at the SPDC have a lot of clients over to Jane or other counselors, and they are always welcoming and always willing to answer your questions. So there is no silly question. I know that and I know that you can answer the questions for the people that are out there, and to give them the best advice. Is it worth the money, and the time, and the effort, or is this something that maybe now is not the best time to do that? So you’ll be honest with them and I know that.

Like I said, no question is too silly or too dumb to ask if I can that you’re willing to help whoever and with whatever their question is. So we really appreciate that.

Absolutely. That’s why I’m here.

Jane, thank you so much for being with us today. We hope that having you as a guest today has gotten our listeners thinking about growth opportunities that exist with doing business with the government. We don’t want to have all our eggs in one basket, so this is a great way to start diversifying your revenue streams. But thanks again for being with us, and thank you for being available to our clients.

My pleasure. I’ve enjoyed spending this time with you and if I can ever be of any assistance, please, do not hesitate to reach out.

Thanks Jean. Cathy and I hope that we send you your next Nordic Air.

Well I’ll hold you to that, OK?

That’ll be our goal over here at the SPDC.

OK.

Thanks.

Thanks for listening. Look for BizChat Ohio on Apple Podcasts, Google Play, or Spotify, and subscribe to receive our latest episodes and business blogs at BizChatOhio.com. If you would like to learn more about the Ohio Small Business Development Center at Lakeland, please visit our website at www.LakeLandCC.edu/SPDC.