A Tier-by-Tier Breakdown of GSA’s $12B Marketplace

In Federal Contracting we generally put small businesses into three tiers based upon the complexity versus labor management required.  I always like to call this the skill verses hustle tradeoff. A GSA Schedule instead, you must switch from a "Hustle" strategy to a "Price & Convenience" strategy.

Here is how you use the GSA Schedule to dominate Jumpstart your Small Business through Federal Contacting:

Tier 1: High Barrier (IT / Consulting) – 4,870 Vendors / $9.2B Annual Sales

The Strategy: "The Best Value Play"

Average Sales: $1.8MM YR

In Tier 1, the government isn't just looking for a "small business"; they are looking for a low-risk expert.

• The GSA Move: Apply for a GSA Schedule under the "Startup Springboard" program. GSA usually requires 2 years in business, but Springboard allows IT companies to use the professional experience of the founders to get on the schedule early.
• How you win: Once you are on the GSA Schedule, your rates are "pre-negotiated." You go to an agency and say, "You don't have to put this out for a 6-month bid. I'm on the GSA Schedule; you can buy my hours in 48 hours using eBuy."
• Profit Margin: Stays high (15%+) because you aren't fighting 100 other companies in an open bid; you are only fighting the other 5-10 people on that specific GSA Schedule.

Tier 2: Medium Barrier (Security / Logistics) – 885 Vendors / $2.0B Annual Sales

The Strategy: "The Partnership Play"

Average Sales: $2.3MM YR

Tier 2 often requires expensive equipment or specialized bonding that a startup might not have.

• The GSA Move: Use a Contractor Teaming Arrangement (CTA). This is a special GSA rule where two GSA holders can combine their skills to bid on a big job.
• How you win: You find a large company that has the trucks or the guards but is "too big" to win a small business set-aside. You (the GSA holder) act as the lead. You bring the GSA "contract vehicle," they bring the "boots on the ground."
• The Barrier: You get the "Past Performance" of a giant company on your resume without having to own 50 trucks yet.

Tier 3: Low Barrier (Janitorial / Facilities) – 609 Vendors / $863MM Annual Sales

The Strategy: "The BPA (Blanket Purchase Agreement) Play"

Average Sales: $1.4MM YR

In Tier 3, the government buys these services like clockwork. They hate bidding out a new cleaning contract every year.

• The GSA Move: Target a BPA. A BPA is essentially a "Charge Account" the government opens with you on your GSA Schedule for 5 to 10 years.
• How you win: You don't bid on one-time jobs. You market to a local Federal Building Manager and show them how a GSA BPA saves them from doing paperwork every month.
• Scalability: This is how you hit your highwater mark for revenue. One BPA for a large military base can be worth $2M/year for 5 years.

A GSA Schedule can be a great way to create value through federal contracting. If you have ever wanted to grow your business or provide some stability to your income statement a GSA Schedule Contract can help. Give us a call and in about 10-minutes we can go over the qualifications.