Recession Proof Your Business Now!

On Oct 7, 2009 The New York Times published a Small Business Guide to getting government contracts.

There are many federal contracting opportunities for small businesses, but to take advantage of them you have to know the ins and outs of the government’s contracting rules and regulations. Of the more than 20 million small businesses in the United States, only about 500,000 are currently in a position to do business with the federal government. That’s not because they are the only ones capable of doing the work; it’s because they know how to get the work.

Continue Reading: “Getting Government Contracts”

Recession Proof Your Business Now!

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Recession Proof Your Business!

It is truly amazing how much money the government spends contracting with businesses.  At a time when companies are cutting back because of lack of business, the government is spending more than ever…nearly $500 Billion will be spent this year alone!

The U.S. government is required by law to award contracts to civilian businesses. Nearly 40% of all contracts MUST be given to SMALL businesses like yours.

If that is not enough:

• ALL federal purchases between $2,500 and $100,000 MUST be Set-Aside for Small Businesses
• The government is required by regulations to pay small business in 30 days.
• Federal agencies have a statutory obligation to reach out to small businesses and to purchase from them whenever possible.

Recession Proof Your Business!

Here are five steps to winning a government contract:

1. Understand the System: The government’s procurement process is not easy to navigate.  You have to become familiar with its rules and regulations.  The Federal Acquisitions Regulations is like a maze.  Before you start bidding on government contracts, you must learn this process first. 
   
   Don’t assume just because you are dealing with government it is not business as usual.  The government will look at your business organization and see if you are qualified to support a government contract.  Therefore, make sure you get your company in order before you start bidding.  Get your processes, staffing, financial status, track record and performance straightened out first.
2. Take Advantage of the Set Aside Programs: In 1994, The Federal Government passed the “FASA” or “Federal Acquisition Streamlining Act”. The goal was to simplify and streamline how the government purchased goods and services valued at less than $100,000. Under this act ALL federal purchases between $2,500 and $100,000 MUST be Set-Aside for Small Businesses

Additionally the set aside programs help:
• Women-owned businesses: A woman-owned business is one that is owned and controlled 51% or more by a woman or women.
• A small disadvantaged business: A small disadvantaged business is one that is 51% or more owned, controlled and operated by a person who is socially and economically disadvantaged. African Americans, Hispanic Americans, Asian Pacific Americans, Subcontinent Asian Americans, and Native Americans are presumed to meet this standard. Other entrepreneurs can qualify by showing, via a “preponderance of the evidence,” that they are disadvantaged.
• A veteran-owned business: This is a business that is owned 51% by a veteran.
• A service-disabled veteran-owned business: This business is owned 51% by one or more service-disabled veterans. The Veterans Administration confirms the disability.

3. Register as a Federal Contractor: To bid on government contracts, you need to register with the Central Contractor Registry (CCR). This is your company’s profile and the starting point for all government contracts.  This is where you make the best representation of your business and present your “brand”.
4. Find Bidding Opportunities: Learn to navigate the FedBiz Opps, Dibbs and Other Programs.  Become acquainted with each agency’s contact person, they are your greatest point of contact.  Attend the SBA’s “Business Matchmaking” events.  This is where small businesses can quickly meet with government and corporate procurement officers.  Business Matchmaking, is like a traveling road show of procurement opportunities.
5. Bid: The steps above will get you to the contracts, but you still have to bid, build credibility, and sell the government on the idea why your business is best qualified to win the contract.  Pitch your product or service…in other words; you have to sell it just like any commercial transaction.

Recession Proof Your Business!

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Sometimes I imagine President Obama knocking on my door and asking me…”Hey Jackie, you meet an interesting part of our demographics and would like your opinion on how to fix this unemployment problem”

Let’s see:

• I am South American (Hispanics are the fastest growing sector of our population)
• I am female (more women are starting businesses than men)
• I am an entrepreneur (small businesses provide the largest number of employment)
• I am highly educated (more and more women are graduating from college)
• I am a single mom (phew, thank goodness this trend is going down!)

So, to continue the story of my wild imagination, I would tell President Obama:

1. First get rid of banks. They are nothing more than self-serving institutions only looking out for themselves. As long as small businesses have to depend on them to create employment…this country is doomed.
2. Give lending powers to the SBA and allow them to lend directly to small businesses.
3. Do not use credit rating or asset pledge to lend. Instead use employment conditions. In other words, for every $50k of lending a small business needs, they would have to hire one American employee.
4. To avoid misuse, the SBA would link directly to the small business’ on-demand access to key metrics/analytics performance tracking systems, such as COGNOS Express. This business intelligence system would track the performance of both, your business and the employee. If the employee does not perform, then you are allowed to trade the employee for another one…as long as you provide 1 employment for every $50k of lending.
5. To make it even safer that you are not hiring your “cousin” just to prove employment. You would have to tie your analytics systems to your financial statements, which in turn would be tied to your tax returns…no funky business here.
6. Everything would have to be transparent. You want the money, you can have the money, but on your end you would have to:
   a) provide employment
   b) perform!

Now, think of the benefits of doing this. We would:

• Provide lending to small businesses
• Create employment
• Create an entire new booming field in the business intelligence industry
• Eliminate doomed institutions such as our inefficient banks
• Create high performing small businesses and lower their demise statistics

…how simple is that Mr. President? Just do the math…how many jobs would the bank’s bail out money had generated, had you used this simple system to fund small businesses?

Oh, and by the way, in case you are interested on knocking on my door to hear about my imaginative ideas, please do not hesitate to contact me.

So you want to start a business and have some pretty good ideas of what you want to do.  There is only one slight problem; you have not funds to get it going.  You figure, after gazillion years of relationship with your banker, it is time to cash in.  Armed with your business proposal you head out to borrow funds.  Oops, you find out the bank is not lending.  So you just wasted all those years building a relationship with your banker, which during tough times is pretty much…meaningless!

Well, you say, let me get a home equity line to get my business going.  You fill out an application; submit tons and tons and tons of documents.  Wait for the appraisal to come in and…oops, you have no equity!  And your credit is not as perfect as the banks now want it.  Hum, you think, I have to get my business going, what do I do now?

So, you decide you are going to raise private funds.  Attracting Angel Investors sounds like a pretty good strategy.  So you buy the latest “Business Plan” builder software, a few books on angel investment and private equity funding and off you go.  You spend precious weeks, maybe months aligning your strategic documents to make a sales pitch to some deep pocket angel investor.  You are absolutely 100% sure, he will open up his wallet the second he hears your wonderful business pitch.  Time keeps on ticking and no angel investor has gotten back to you yet.

By now, months have passed and you still do not have a business, or funds or really nothing but a burning idea.  Your savings are depleting fast.  Your credit cards are maxing out.  Panic sets in.  Reality is not looking good…now what?

Well, first of all, the biggest misconception out there — which I believe comes from outdated books and information from the dot.com era – is that no one will even bother to look at your business unless YOU make it successful first.  It does not have to be in a large scale.  In all fairness, why should people risk their money on you, if you have no track record?  Would you invest in someone without proof that they can succeed?  You have to prove yourself first.  The time when you just wrote a compelling business plan, approached investors, and got money are looooonnnnngggg gone.  And for the looks of it, it may never come back.

So you may be wondering, what can you do now?

1. If you do not have money or business training, start with the lowest possible risk.  Selling online affiliate products is probably the best way to start a business while reducing risk and building business acumen.
2. Set money aside before you start your business.  Save enough to cover all your expenses for at last 6 months to a year.  This way you do not panic 3 weeks into your business venture because you do not have money to pay the water bill.
3. Start small, build up.
4. Start on a shoe-string.  Forget about the fancy offices, or the latest phone system.  Watch you expenses like a hawk.  Costs have a funky way to get out of control when you are starting out.
5. Use all the available free tools.  There a numerous, powerful open source applications you can use to build and grow your business.  All you need is a computer and internet access.
6. Once you start bringing money in, and as soon as you can afford it, hire help and start delegating.
7. Bringing customers AND retaining them should be your number one priority at all times.
8. Concentrate on working ON your business, not IN your business.  Build systems.
9. If you have something that is patentable…go for it.  Investors love patents.
10. Once you have sales coming in.  Patents if possible.  And proof that your business has growth potential…then and only then, approach private equity investors.

If you are interested in learning how to build a VIRTUAL BUSINESS so you can start your business on a shoe-string, then just enter your email address in the form below for instant access to the ““How to Build a Virtual Business Architecture” training video…

As I read “The Match King: Ivar Kreuger, The Financial Genius Behind a Century of Wall Street Scandals “, I realize, history repeats itself. The players may be different, but the story is pretty much the same. What happened in 1932 is almost verbatim what is happening today. Housing prices plunged, lending markets froze, foreign markets crashed and many nest eggs were empty shells. Does that sound familiar?

There is one big difference between then and now. Thanks to the evolution of technology, people no longer have to be victims of the greediness and recklessness of the markets and the old institutions. In today’s market anyone with talent can make it big. The playing field has been leveled in ways never seen before. No longer do you need thousands of dollars of funding to start up a company, nor do you need to know movers and shakers to make it big. All you need is passion, time and perseverance and just about any skill or talent you have can become a force to be reckoned with.

Although unemployment is a major problem today, people only need to understand they do not have to be victims to the rifts of the markets. With a little knowledge, each and every single one of us can become a major market player. The massive changes taking place, will rock just about every institution on the planet and if you don’t take charge of your life now, you may soon go down with all the sinking ships.

But you may be asking, how do I go about it? It is true; the learning curve can be time consuming, confusing and overwhelming. There is so much information out there, where does one start? If you want to find out how I did it (and how YOU can do it too), enter your email address in the form below for instant access to the ““How to Build a Virtual Business Architecture” video…