Doing Business in the U.S.
According to SelectUSA.gov, the United States is consistently ranked among the best internationally for its overall competitiveness and ease of doing business. Backed by a regulatory environment that is particularly conducive to starting and operating a business, U.S. business culture encourages free enterprise and competition. As a stable democracy with a transparent and predictable legal system, all companies – regardless of national origin – compete on an even playing field. Here we discuss Doing Business with NYC, Doing Business with NYS and Doing Business with the Federal Government.
Doing Business with NYC
New York may be a city of 8 million stories, but at its core is a story of universal success. Because here in the city that never sleeps the hustle never stops.
It’s easy enough to see for yourself: if you can catch a New Yorker at the right moment there’ll be that same twinkle in their eyes that lights up the skyline from the New Jersey Turnpike.
This city is the leading purveyor of office space for Fortune 500 companies. It’s also the home of the nation’s publishing industry, financial markets and media groups. Over 2 million New Yorkers use the subway everyday just to commute to work. And another million or so hitch a ride to the many landmarks and neighborhoods, which attract tourists all year round.
New York may be home to a booming economy that ranks 5th as the most entrepreneurial in the world, but all this success is reflective of the city’s foundations—its diverse and thriving businesses.
By no coincidence, New York City is also one of the largest contracting jurisdictions in the nation. Each year the city spends over $20 billion in contracting dollars on small businesses. This opens up a potential goldmine—but only if you know the ins and outs of doing business directly with the city.
But in order to be hip with all things NYC, you’ll need a Payee Information Portal (PIP) account for starters. The City’s Payee Information Portal is an integral tool, used in various stages of the procurement/contracting process. This will be where business owners will be able to manage their contracts, view invoices and ultimately collect payments, just to name a few of its uses.
Registering a PIP account requires basic information on your company, including your business name, its tax identification number, and contact information. You will also be required to select the particular commodity codes which reflect whatever goods or services your business provides. The commodity code listing can be found here.
With your PIP account accepted and verified, you’ll want to start looking for contracting opportunities with the City Record. This website publishes announcements, solicitations, contract awards and notices for public hearings. Although it is a subscription-based platform, it’s the most common means of finding contracting opportunities for your business—but there are free options as well.
PIP would be the most useful alternative. Once your account has been activated, your business will start to receive notifications of upcoming bids and requests for proposals, as agencies are able to use PIP to send prospective vendors direct solicitations, so be sure to check on your account often.
This is also the perfect time to do some basic market research to ensure there’s a demand for your company’s products or services. Check out published contracting plans on the City Record or agency websites to get a better idea of what the City has been buying.
Also important while conducting this research is to familiarize yourself with the legal procedures involved in contracting. The Procurement Policy Board’s (PPB) web page will direct you to all the rules, amendments and transcripts you’ll need to become a real legal cognoscenti.
After your contract has been accepted by an agency, the City will begin negotiations for its final terms. There is a chance this will include a contract public hearing, but this is on a case-by-case basis and is a generally painless process.
Note that any vendors who have been awarded contracts valued at over $100,000 are required to complete and submit Vendor Exchange System (VENDEX) forms for the contracting entity and its principals; this information will be used by the City when they perform their responsibility review. Remember that the City is required by law to review each contract, as well as each subcontractor who might be in on the deal, so their skillset and integrity will be scrutinized.
The PPB also dictates that your business performance is legally required to be evaluated at least once a year. They use a pass or fail, “Excellent” or “Unsatisfactory” system that analyzes three criteria: the timeliness and quality of your company’s performance, along with your fiscal administration and accountability. These results will be sent to you for a chance to review and respond, before they’re posted on VENDEX. All performance evaluations are then compiled into an annual report.
With your first contract completed, and the City’s payment tucked away in your PIP account, your business will have undergone a rite of passage. But that doesn’t mean your work is done: now is precisely when you should continue trolling agency websites and the City Record for more contracts. Leverage your past experience to make the second and third contract smoother—and hopefully more ambitious—efforts. Because now, just like the lights that outshine the stars in Times Square, when you do business with New York City you’ll become a part of something greater.
Doing Business with NYS
The Empire State isn’t just a goldmine for potential businesses to set up shop. New York spends billions of dollars each year on a myriad of goods and services, from paper clips to construction work, to help our state run like a fine-tuned machine. During the last fiscal year alone the State Comptroller, Thomas P. DiNapoli, and his office reviewed more than 38,000 contract transactions valued at $37 billion.
Doing business with the State can have real potential for prospective companies—but only if you understand its procurement process and the laws associated with it.
As is always the case when dealing with our government’s complex bureaucratic systems, the first order of business is obtaining the appropriate licenses and permits. The New York State’s Online Filing System and Department of State’s Division of Licensing Services offer these services. It’s also important, regardless of whether your business decides to work with the government, because, according to the Small Business Administration (SBA), many owners and entrepreneurs overlook these basic requirements. They’re unaware of what the law requires, which is why the SBA offers links to state-specific license and permit information. And while you’re online, it’s a good idea to verify if your company qualifies as a minority or women-owned business.
According to Empire State Development’s website, their mission is to “promote equality of economic opportunities for minority and women-owned business enterprises (MWBEs) and to eliminate barriers to their participation in state contracts.” In some instances, this can mean that the State will award contracts without a formal competitive bidding process, so long as you qualify as an MWBE, small business, or service-disabled veteran-owned business. You can apply through this website for a certification; if you think your business is eligible, put this at the top of your to-do list. Once you’re up-to-date on the status of your business, it is the time to become a vendor and start bidding on government contracts. Companies can pursue contract opportunities through many different channels.
State agencies are required to notify the public about procurement opportunities valued at over $15,000. All notices are published in the New York Contract Reporter. According to the website, there have been over 200 contracts posted within the last 7 days; 848 contracts are available in total.
A number of New York agencies and public authorities also post their bid opportunities on their websites. Be sure to read the notice of procurement attached to each contract as it provides specific instructions on applying, eliminating a lot of the guesswork involved. New York State’s Office of General Services (OGS) has an Online Vendor Bid system that lists various IT, goods, and services contracts as well.
Businesses may also want to check Open Book New York’s website, where every department and agency that does business with sub/prime contractors is listed. Prime contractors, who typically deal with much larger order sizes than the usual small business owner can handle, often post smaller, bite-sized portions of their contracts here to be filled by small business owners such as you.
Making successful bids can be difficult for newcomers. You have to shoehorn your way into the competition, often against well-established and entrenched players. Pricing acts as the fulcrum of any deal, so there can be considerable pressure to raise or lower your prices, and a balance isn’t always so easily found. Too high of a price will knock you out of the competition, while too low a cost could might you a contract, but it could also ruin your business. There’s also the matter of in-sourcing, where jobs and contracts are given to government employees to perform, which can shut many small business owners out of a lucrative opportunity.
Even if you acquire a contract, you aren’t safe: your competition can resort to bid-protesting, too. It’s become much more common in today’s competitive environment. Competitors can make a bid protest as a claim that the deal was flawed, or that some aspect of it seems suspicious and needs investigating. The petition may not hold water, but contractors should be wary of the legal costs such protests portend, as it’s a common ploy to muscle small time contractors out of a deal.
To circumvent all of this, actively search for contracts to stay ahead of the competition.
Be sure to carefully review the specifications of each order, the delivery instructions— essentially the logistics of the contract itself. And don’t wait until the last minute. Be proactive. Reach out directly to designated solicitation contacts if you have any questions; remember that New York State’s procurement lobbying law imposes restrictions on communication during the actual procurement.
After the State receives your bid, it will evaluate it using what is called a FLIP procedure—the Financial and organizational capacity of your business, Legal authority to do business with New York, the Integrity of your business’s chain of command, and past performance prior to bidding—so consider all these facets that your business will impress upon the contracting officer reviewing your application
After being awarded a contract, the next step is a formal agreement between both parties which may require approval from the State Attorney General if the dollar threshold of the contract exceeds $50,000. The Office of the State Comptroller is also responsible for disputes related to how contracts are awarded, which means they’re the ones who give the final verdict on all bid protests. Hopefully, it won’t come to that. Once a contract has been completed vendors and businesses may receive their contract payments through several different options. These include secure ACH, or e-payments (a new feature that requires a simple registration), after which you’ll be able to check on the status of any payments, pending or otherwise. Or you can go the traditional route and take your check in the mail.
From the Thousand Islands-Seaway to the Adirondacks New York State is brimming with opportunity and open for business. Don’t just live here—do business here, too.
Doing Business with the Federal Government
The federal government spends billions each year on almost every product and service under the sun. But don’t think this is solely with corporations. The federal government does its best to work with a variety of diverse business types. Meaning that no matter how big or small an enterprise is there’s a good chance the government wants what they’re selling.
There are opportunities abound to become a sub or prime contractor for the federal government, but only if you know where to look: the government operates through a myriad of different agencies, bureaus, field units and districts. And each entity works with its own budget and mission. Finding the right fit for your business may seem overwhelming at first, however.
Before you start counting your money in the bank, or even applying for contracts left and right, you’ll have to register your business by creating a profile on System for Award Management (SAMS). The federal government uses this site to find potential contractors to do business with.
Another important first step will be to identify your North American Industry Classification System (NAICS) and Federal Supply Classification (FSC). In order for the federal government to identify product/service listings and procurements it uses these codes.
With all this information at your disposal now is the time to make sure the government has a demand for your business. Conduct basic market research by searching through the FBO.GOV site. They offer a federal contract search engine that helps to fine tune your search and connect you with potential deals more expeditiously.
One important thing to note is that there there are a variety of different contract types that the General Services Administration (GSA) offers. According to their website, the GSA establishes long-term government-wide contracts to commercial firms to provide access to over 11 million goods/services. And their contracts are as diverse as the businesses they deal with. The two most common kinds of contracts the GSA offers are Blanket Purchase Agreements (BPA) and Government Wide Acquisition Contracts (GWACs). BPAs simplify the process of repeat orders, giving customers increased buying power, as it takes advantage of quantity discounts. GWACs establish task and delivery contracts for IT use by other agencies within the federal government.
Just being able to complete an order may not be enough to get you noticed by the federal government. It’s possible you’re in with the wrong kind of competition. Go to sba.gov to find if your business is eligible for certain certifications, such as an 8(a), SDB or HUBZone certification. These certifications may grant your business access to set-aside contracts, which the federal government saves for small or minority owned businesses so that competition is fair.
It can be hard fighting for your fair share with fully-fledged and international companies. Make sure you take advantage of every possible opportunity. In the meantime, bid often and regularly on different contracts. Because of the federal government’s scale, contract requests can come in at all hours of the day, so stay vigilant and don’t be afraid to hit refresh on your browser. The federal government generally takes between 30 to 120 days to review submissions. Contracting Officers (COs) handle each individual proposal. They take into consideration a business’s past performance references, the proposal’s pricing, terms, technical acceptability, as well as the overall responsibility and responsiveness of the business itself.
You’ll want to present your capabilities directly to the CO or agencies hoping to purchase your goods/services. With each proposal that you submit, remember that their time is valuable, so be brief but convincing that your business has the most cost-effective solution to their requirements.
Applying for government contracts can prove to be an arduous process. But don’t lose hope. The federal government allocates around a fourth of its contracts to small businesses. In 2016, with $82.8 billion spent by federal agencies, that meant around $18 billion was spent on small businesses alone.
As Lourdes Martin-Rosa, American Express OPEN adviser in Government Contracting, said in a phone interview with Small Business Trends, “The only thing the federal government really manufactures is money. So if they’re going to purchase anything, whether it’s zippers or furniture, it’s going to come from a private entity. And hopefully in most cases that’s a U.S. business.”
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