How to Qualify for Government Work as a Prime Contractor

Every year, the federal government awards billions of dollars to prime contractors to perform work. Since Congress passed the Infrastructure Investment and Jobs Act in 2022, billions more will be awarded in projects in the years ahead. Becoming a prime contractor can set you up to handle this work.  

The federal government’s goal is to award 23% of government-wide prime contracts to small businesses. A total of 16% of all government contracts will also go to disadvantaged businesses, women-owned businesses, HubZone businesses, and service-disabled veteran-owned businesses. Overall, this accounted for $144 billion in 2020. 

Winning government work step-by-step

The American Rescue Plan signed into law in March 2021 authorized another $100 billion to “rapidly deploy new contracting solutions to procure goods and services necessary to facilitate America’s recovery.” 

Then, the Infrastructure Investment and Jobs Act, signed into law in October, authorized $550 billion in new spending for repairs and modernization to a wide range of infrastructure needs. Since all these investments will happen over the next five years, there’s a great need for contractors who can manage complete projects as prime contractors.

1. Assess your business

You might think of prime contractors at the federal government level as huge firms, but that’s true mostly for megaprojects. There are still plenty of small prime contracts available to small businesses. Besides offering your services as a prime contractor, you can also join with other contractors to form a prime contractor team as a joint venture.

When deciding whether to get into government prime contracting, the first goal is to assess your business. The government wants to work with established companies that have performed reliably in construction. If you feel your business meets that criteria, keep in mind that getting your first contract might take a couple of years. So, make your government contracting goal a realistic one. 

2. Register for government work

Once you are committed, here are the first steps to becoming visible to agencies searching for contractors:

• Get your DUNS, a nine-digit identification number for each of your locations.
• Decide where your service fits in the North American Industry Classification System (NAICS) code (general contractors fall in the 236XXX range).
• If you want to apply for contracts under the Small Business Administration programs, you should confirm your business meets the size requirements.
• Register your business with SAM (System for Awards Management), which is the database government entities use to find contractors.

3. Learn the rules

Get acquainted with the federal contracting rules in the Federal Acquisition Regulation, or FAR. This is essentially the rule book for contracting with the government. Pay particular attention to Subchapter F – Special Categories Of Contracting, Part 36, Construction and Architect Engineering Contracts.

You need a general understanding of the government rules and expectations. Subchapter F will help you understand the process the government expects you to use when bidding and performing on contracts with fixed price and design-build delivery methods. If you are going for small business programs, also get familiar with 13 CFR 125.

4. Streamline business operations

The government will look for signs that you are competent in running a business. You’ll be expected to have business systems in place like an accounting system, earned value management, estimating system, material management, property management, and purchasing. 

Since construction is so dependent on project management, you should be able to show you have a system for that. Because of its API integrations, Procore’s project management system actually allows you to tie other business systems to your project management. This can help with compliance and reporting, two other crucial aspects of government contracting.

5. Play to your strengths

Government agencies build a wide variety of projects, from housing to highways. They are looking for contractors with the demonstrated ability to deliver the type of construction project out for bid. Look for opportunities that play to your strengths and experience.

Creating a joint venture is another avenue that contractors have found success with. You may choose to partner with a firm that has completed the type of government contract you are interested in, and prepare a bid together.

Firms that lack the experience needed for a particular type of project may also hire someone (an individual employee or an entire team) that brings a strong background in that work. For example, road construction is a completely different beast from residential or even commercial construction. Hiring a superintendent that has delivered multiple state or federal highway projects can be an effective way to meet the qualifications required.

Perhaps you aren’t ready to try for prime contracting with the government. Another path to prime contracting is starting out as a subcontractor with existing prime contractors. You can find these opportunities at the GSA’s Subcontracting Directory for Small Businesses, the Department of Defense Subcontracting Opportunity Directory, and the SBA’s Directory of Federal Government Contractors With a Subcontracting Plan.

6. Set your company apart

Look for opportunities to stand out. Being able to differentiate your company through technical excellence, proposing novel solutions to problems, or offering more value increases your chances of winning a government contract.

An important aspect of performing as a prime contractor is hiring subcontractors. In fact, many prime contracts will require a large percentage of the work to be handled by subs. You should keep in touch with all your current and former subs as well as develop strong relationships with new ones. The bigger pool you have of potential partners, the better the chances of landing a contract and of completing it well.

7. Explore bidding opportunities

When you feel prepared to start bidding, then you can use Sam.gov or GSA Schedules websites to find requests for proposals and contracts looking for bids. You’ll want to focus only on those projects that match your skills. Try to set a goal for a certain number of proposal responses or bids every quarter. Spend some time every month reviewing your progress while looking at ways to streamline your system and improve the quality of your submissions.

Your experience, innovation, competitive pricing, thorough understanding of government contracting, and a successful track record in your construction sector will set you up for success in government contracting. Keep and improve on those while doggedly pursuing contracting opportunities.

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