Companies that meet the criteria of a disadvantaged business enterprise (DBE) are highly sought after on government bidding sites. When trying to stay competitive and profitable as a DBE, it is advantageous to go after these types of contracts; if not, you could leave money on the table. Especially when working in larger markets, where inclusion is a priority, your chances of being selected increase significantly if you qualify as a DBE.
The current administration is focusing more on increasing the share of procurement dollars going to underrepresented businesses, including minority-owned and women-owned businesses. In the U.S., a focus on infrastructure projects on a federal and local level and other government contracts is estimated to be an investment of $862 billion in 2024, which is a 2.6 percent increase from 2023. The description of the new federal budget details the investment in improving buildings, structures, infrastructure, and major equipment. Over 40,000 projects have started since the passing of this legislation. Efforts in Canada to support underrepresented businesses are just as strong, with the construction industry expected to grow 2.7% between 2025 to 2027 with industrial, commercial, and institutional or ICI sector leading the charge. Additionally, the infrastructure sector will grow to $31.3 billion in 2024, up from $30.4 billion this past year.
We’ll discuss the details more below, but if your business qualifies, certify and secure your seat at the table. Once you’re there, a firm commitment to your networking and bidding process could place profits on your plate. There are tips you can use to help put yourself at the table and ensure that you stand out. Before jumping into a government bid, let’s walk through what you need to know.
Disadvantaged business enterprise (DBE) is a broad term used to call out the groups of underrepresented general contractors and subcontractors represented on a job site who own at least 51 percent interest in their company. The inclusive list includes race and ethnic diversity, gender identity, veterans, small businesses, neurodiverse groups, and more. Make sure you double-check the requirements of the local entities in your market regarding what classifies you as a disadvantaged business. Eligible businesses should be certified and registered for government construction programs and projects to strengthen your profile and stand out as a qualified competitor in the marketplace.
Get invited to the Table.
The first step to being invited to the table is to get your business certified for government minority contracts.
Federal programs like the Office of Federal Contract Compliance Programs (OFCCP) and Disadvantaged Business Enterprise (DBE) exist to combat discrimination, protect workers, and provide chances to get properly certified to bid on government contracts. The process may vary depending on the program, but certification typically lasts for a year. Suppose you’re talking about bidding on government projects in larger metropolitan areas. In that case, you’re going to apply, get certified as a DBE business, and then you’re on the approved bidders list. These lists are maintained within some of the bid management tools that general contractors use, so when they invite others to participate in a collaborative bid, your business will show up as an option.
General contractors preparing to submit a bid on government projects that have a DBE requirement will refer to the specifications document for each project to determine the set aside requirements. The GC will ensure you’ve met the bid requirements set aside through a bid management tool, relying on information in the tool and/or submitted as a part of your bid proposal as to whether you’ve qualified as a DBE. They’ll typically generate a report that shows your efforts to secure the desired level of representation and include it as part of the bid proposal. As you’re navigating these processes, never underestimate the power of networking and the difference proactive outreach makes to your bottom line.
Take Your Seat
You may have experienced some general contractors who send invitations to bid to disadvantaged businesses as a formality, but they may not use them for the actual bid or for the project. To counteract that possibility, once you take your seat at the table, make it known that you deserve to be there. Your most helpful tool may be your bid proposal. Do you know how to write the proper proposal? Or how to submit pricing? Good bid preparation requires a lot of time and effort. It involves everything from reading and fully understanding the plans and specifications to accurately estimating labor, materials, and equipment costs.
Here are a few Pro Tips:
- Perform accurate takeoffs and measurements.
The goal of using a takeoff tool is to create an accurate scope of work. The estimate is then created by adding the details of labor, materials, and equipment required to execute the project. Finally, you’ll have to add the burdens, overhead, and profit you desire to create an accurate bid.
- Complete all bid forms and documents.
Required documents and paperwork can be anything from bid bonds to acknowledging receipt of any addenda. It will pay off to be thorough in this process, even triple-checking your work to ensure that every I is dotted, every T is crossed, and every checkmark is accounted for in your documents. An incomplete bid proposal could negate all your work up to this point and disqualify you from the contract opportunity. The bid should also include a list of inclusions and exclusions to clarify its purpose.
- Reach out & Ask questions.
If you have questions about the project’s scope, you should reach out and ask in advance. It is one more opportunity to show interest in the project and create trust and credibility.
Bid & Make Bread
Once you’ve formulated relationships and crafted a worthy proposal outlining your experience, it’s time to land some government contracts. Staying competitive is a multilayer process that includes ensuring your team’s productivity isn’t lacking, that you’re staying knowledgeable of advanced techniques and modern materials, that you’re investing in your equipment, and strengthening your takeoff and estimating skills. By following these steps, you’ll bid on projects with the confidence, time, and financial resources to perform the work and complete the project.
Want to learn about federal, state, and local government construction opportunities in your area? Several organizations and programs exist to help disadvantaged businesses across the US and Canada.
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