The Perks of Working as a Subcontractor

Aug 10, 2017 11:22:53 AM / by USFCR

Sometimes the path to contracting success is more circuitous than we'd like it to be.

And by "we," we mean you, or, if not you, then the company for which you work, a company that may want to complete a System for Award Management registration, research available opportunities, and bid on these opportunities, each time hoping that the contract specialist and/or government buyer plucks your bid out of the stack and decides to give you the contract.

This happens. Of course this happens. Contract specialists and/or government buyers award contracts every day to prime vendors who then, in some cases, work with a subcontractor (or more than one subcontractors, depending on the contract).

Don't believe me? Check out (or, if you're interested in our proprietary system, the Advanced Procurement Portal), and you can see for yourself the contracts awarded to businesses around the country -- and, in some cases, businesses around the world -- each one, at one point in their history, exactly where you may be, taking the first steps to becoming a government contractor.

But nowhere is it written that you have to jump in with both feet, angling to win large government contracts, or even any government contracts as a prime vendor. At least not at first. Not that there's anything wrong with aiming high. Many new businesses land lucrative contracts simply because of the products and services they offer. That can and does happen. So please don't read this as our attempt to dissuade you from government contract work.

Our firm was based on the belief that all small businesses deserve their fair share of government contracting dollars, and we continue to believe that today.

But an often overlooked resource for businesses interested in government contracting is accepting work from a prime vendor as a subcontractor. The U.S. General Services Administration (GSA) recommends companies interested in doing business with the federal government, but not sure if it will be lucrative, simply "try it out first."

In recent guidance, the GSA said that businesses "should strongly consider subcontracting."

"As a subcontractor, you can perform part of the work on another company's contract without dealing directly with the government," the GSA said. The agency also shared four "perks" of subcontracting, which it based on what the U.S. Small Business Administration (SBA) recommends businesses keep in mind.

The Four Perks of Subcontracting

Fewer Administrative Obligations

Subcontractors, according to the SBA, won't have to deal with the government directly. The prime contractor is solely responsible with this communication, and he or she works directly with the contracting officer at the agency that awarded the contract. Subcontractors have very little administrative responsibilities -- just those that are required between you and the prime contractor.

Lower Business Development Costs

The SBA also believes that working as a subcontractor results in enjoying lower costs to do business. Why? Because someone else is taking care of capture management, identifying and assessing potential opportunities with the government, and outlining/developing the best approaches to going after them.

Getting More Work

Subcontractors who offer one or more types of specialized services that can be applied broadly as a small piece of a larger project, but can't fulfill a contract's full requirements, can partner with a prime vendor and gain experience (which we'll get to in a minute). Many government contracts, according to the SBA, call for a range of services and/or products, and business owners can benefit by potentially earning more work across a broad range of contracts that need your specific services and/or products rather than spin their wheels trying to win contracts that they may not be able to fully fulfill.

Gaining Past Performance

Working with partners (e.g., prime contractors) help business owners gain valuable past performance, which government buyers want to see when evaluating your business to receive a contract award. You gain this past performance by completing government work, which you do as a subcontractor. Listing subcontracting experience under past performance is valuable -- this experience shows a government buyer that you are versed in working as a government contractor and able to meet deadlines. Having a credible record improves your chances for winning a contract award, according to the SBA.

The Bottom Line

You've likely heard it before, and I'll say it again: There is no one right way to becoming and succeeding as a government contractor. The path from start to finish is not the same for all businesses. The starting point is (I'm interested in government contract work), as is the ending point (Congratulations, you've received a contract award), but getting there is part of the process. Subcontracting is one avenue to consider and, if you feel it will benefit you, pursue. You can easily identify potential subcontracting opportunities by reviewing opportunities in FBO (as you would when looking for contract opportunities). When you see a contract has been awarded that calls for your services and/or products, reach out to the business that received the contract, introduce yourself, and find out if there is potential subcontract work available.

Also, some contracts -- especially larger ones -- require prime vendors to work with subcontractors. Other than doing your homework, there is no easy way to identify these opportunities. But the cards are not stacked against you, regardless of your size and number of years in business. The government wants small businesses to work with it, and to succeed. Think about it. One way of making America great again is investing in small business owners, and how better to make these investments than by making opportunities available that the government -- and our country -- need to be completed.

We're here to help. From completing the steps necessary to register as a government contractor, to identifying and bidding on available opportunities, we are here to help you succeed. Think of us as an outside agency with the experience to help you navigate the contracting process. There may not be one right way to win a contract, but everyone, from time to time, needs someone in their corner, cheering them on and making sure they have what they need to best position themselves for success.


Written by USFCR

US Federal Contractor Registration (USFCR) is the largest and most trusted System for Award Management (SAM) registration and renewal firm. USFCR also provides set-aside qualifications, including women-owned, veteran-owned, disadvantaged (8a), HUBZone and other federal contracting services, technology, and training.