The federal
is the largest contractor in the United States. This does not
mean that getting work from the government is an easy task. Landing a contract
with the government is not quite the same as contracting out your product or
service privately. Doing business with the government is a process that
involves considerable work up front before a contract can be signed.

This report provides consultants and contractors with
an overview of the steps involved in obtaining a contract to work for the
federal government. State and local agencies will have their own rules, of
course, but many of the steps will likely be the same.

Federal purchasing agencies

Three characteristics set government spending apart from
private business spending. These are important to know when attempting to land
a government contract:

  • Government
    contracts are heavily regulated to curb misappropriation of funds and
    ensure uniform policies and practices across agencies.
  • The
    contract terms are the product of careful drafting by teams of government
    attorneys and have often received distinct meaning through past contract
  • Government
    contracts follow a very different procedural path than those of private

(An Overview: Government Contracts Law Compliments of The Legal Information Institute)

The U.S General
Service Administration
(GSA) is the purchasing agent for the U.S.
government. It is one of three central management agencies in the federal
government. The GSA purchases goods and services around the world for federal
and civilian agencies, the military, federal courts, and Congress. It employs
approximately 14,000 people and has an annual budget of nearly $16 billion. The
GSA also provides services to support the work of the government, negotiating
contracts that account for $40 billion in goods and services and include
everything from toothpaste to stealth bombers. It is through the GSA that
consultants and contractors apply for contracts with the federal government.

The main business of the GSA is carried out by three
services: the Federal Supply Service (FSS), the Public Buildings Service (PBS), and the Federal Telecommunications Service (FTS). When bidding for
a government contract, contractors deal with the FSS.

The FSS handles the supply and procurement
responsibilities for a variety of consumer goods. The FSS uses a schedule
program that is similar to regular commercial buying practices. It provides
commercial products and services at volume-discount prices. The government,
however, does not utilize “middle men”;— the orders
are placed directly with vendors.

Getting started

Listed below are the steps that need to be taken when
beginning the process of applying for a GSA Federal Supply contract:

  1. Browse
    the FSS Web site for contractor related information.
  2. Identify
    the Federal Supply Schedule that covers your product or service.
  3. Obtain
    a copy of the Federal Supply
    solicitation for the product or service on the Internet.
  4. Obtain
    a Dun & Bradstreet reference
  5. Complete
    all information in the solicitation.
  6. Be
    ready to negotiate your best offer.

FSS contracts and government solicitations

The FSS offers two types of contracts: Single Award Schedule
and Multiple Award Schedule. Single Award Schedule contracts are made with one
supplier for a specific product, at a stated price for delivery to a
geographical area. Multiple Award Schedule contracts are given to multiple
companies supplying comparable products and services at fluctuating prices. The
theory is that the variety of vendors allows the government to select the
lowest overall price for a valued item.

Government solicitations are distributed though the Electronic Posting System. You
can reply to a solicitation using the Standard Form 1499. Some information
required to complete the form includes:

  • The
    basic solicitation.
  • A
    commercial price list and catalog containing the products.
  • A
    manufacturer’s price list.
  • Documentation
    to support the difference between the discount offered and the best
    discount available.
  • A
    letter of supply from the manufacturer of the products being offered.

Price analysis

When deciding whether to grant a contract, the government
performs a price analysis in order to reach a fair price with a potential
contractor. Some factors that affect the price analysis are the current price
for the good or service, the government’s estimate, and recent awards. Other
pricing factors may include:

  • Past
    and projected value of the item or service, and the current dollar amount
    of the purchase.
  • Current
    market conditions.
  • The
    extent of the product’s competition.
  • The
    inventory of the product or service.
  • The
    difference in price offered to the government and other buyers.
  • The
    most favored customer’s estimate.
  • Special
    concessions, terms, and conditions.
  • Price
    adjustment provisions for the product or service.


During negotiations, the main purpose of the government’s
contracting officer is to come to a consensual agreement with the offering
party. The government’s main objective in awarding a contract is to get the
offering party’s best price, so this becomes a key part of the negotiation
process. If the contract is awarded, a proposal revision is requested of the
contractor. This document confirms the terms and conditions agreed upon by the
two parties. The contracting officer will also present to the contractor a copy
of the contract and a copy of the catalog/price list as accepted by the

Commerce Business Daily

Another source for information about government contracts is
the Commerce Business Daily
(CBD). The CBD is issued by the U.S. Government Printing Office and published
daily on the Web by the Community
of Science
. The publication provides information about government
procurement actions, contract awards, and sales of government property. The CBD
also features an Alert Service that allows users to create custom searches. The
CBD is updated every day, and the user is notified of new announcements by

In addition to these features, the CBD also offers:

  • Full-field
    search capability.
  • Browse
    capability for current and back issues.
  • Direct
    links to full-text articles.
  • Customized
    CBD Alert Service.

GSA’s Small Business Centers

District of Columbia

Business Service Center (WCA4)

Program Support Division

7th & D Streets, SW, Room 1050

Washington, DC 20407

Tel: (202) 708-5804

Fax: (202) 205-2872

Connecticut, Maine, Massachusetts, New Hampshire,
Rhode Island, Vermont

Business Service Center (1AB)

T.P. O’Neill, Jr. Federal Building

10 Causeway Street, Room 290

Boston, MA 02222

Tel: (617) 565-8100

Fax: (617) 565-8101

New Jersey, New York, Puerto Rico, U.S. Virgin

Program Support Division (2AR)

Business Services, Room 18-130

26 Federal Plaza

New York, NY 10278

Tel: (212) 264-1234

Fax: (212) 264-2760

Delaware, Maryland, Pennsylvania, Virginia, West

Program Services Division (3ADS)

Wanamaker Building

100 Penn Square East, Room 829

Philadelphia, PA 19107

Tel: (215) 656-5525

Fax: (215) 656-6404

Alabama, Florida, Georgia, Kentucky, Mississippi,
North Carolina, South Carolina

Office of Enterprise Development (4E)

401 West Peachtree Street, Room 302

Atlanta, GA 30365-2550

Tel: (404) 331-5103

Fax: (404) 331-1813

Illinois, Indiana, Michigan, Minnesota, Ohio,

Business Service Center (5ADB)

230 South Dearborn Street, Room 3714

Chicago, IL 60604

Tel: (312) 353-5383

Fax: (312) 353-5385

Iowa, Kansas, Missouri, Nebraska

Office of Enterprise Development (6ADB)

1500 East Bannister Road, Room 1160

Kansas City, MO 64131

Tel: (816) 926-7203

Fax: (816) 823-1167

Arkansas, Louisiana, Texas, New Mexico, Oklahoma

Office of Enterprise Development (7CPP)

819 Taylor Street, Room 9A00

Fort Worth, TX 76102

Tel: (817) 978-3284

Fax: (817) 978-4126

Colorado, Montana, Utah, North Dakota, South
Dakota, Wyoming

Business Service Center (8PB-B)

Denver Federal Center

Building 41, Room 145

P.O. Box 25006

Denver, CO 80225

Tel: (303) 236-7408

Fax: (303) 236-74503

Arizona, California, Hawaii, Nevada

Office of Enterprise Development (9ADB)

450 Golden Gate Avenue, 5th Floor, Room 6514

San Francisco, CA 94102

Tel: (415) 522-2700

Fax: (415) 522-2705

Alaska, Idaho, Oregon, Washington

Office of Enterprise Development (10AB)

400 15th Street, SW

Auburn, WA 98001-6599

Tel: (206) 931-6599

Fax: (206) 804-74887

Satellite Office

Business Service Center (9ADB-L)

300 N. Los Angeles Street, Room 3259

Los Angeles, CA 90012

Tel: (213) 894-3210

Fax: (213) 894-3473

Federal Supply Service Information Center

1941 Jefferson Davis Highway

Crystal Mall Building 4

Room 104

Arlington, VA

Tel: (703) 305-6477

DSN: 327-1022

Other helpful contracting links:

Central Contractor Registration:

Federal Market Place:

Financing for small businesses:

Small Business Association: