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| Montgomery Inc.: Bidding Wars |
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Network aims to reverse losing trend in federal contracts
Now experts in government contracting warn that Maryland companies are increasingly losing competitions for federal jobs. This summer, Eagle Eye Publishers completed a report for the Montgomery County Chamber of Commerce showing the value of federal contracts awarded to companies in the Maryland suburbs of Washington dropped by 2.4 percent from 2005 to 2007. That stripped Maryland businesses of $289 million of work. The report defined suburban Maryland as Montgomery, Prince George’s, Frederick, Charles and Calvert counties. Contracting dipped 2.3 percent in Montgomery and 4.4 percent in Prince George’s. During the same period, contracts going to Washington, D.C. companies jumped 9.8 percent or $1.3 billion. Contracts going to Northern Virginia firms rose 1.1 percent or $3 billion. Officials at the Montgomery County Chamber are hoping to reverse that trend. In August, they formed the Government Contracting Network. Lead by Montgomery County and Northern Virginia experts in federal contracting, the network is slated to host information sessions with federal officials, organize workshops on key business systems and provide other resources to make Maryland businesses more competitive. The proposed events range from free workshops and webinars to half-day, $90 information sessions with senior federal officials and prime contractors. “We want to win more contracts. That’s the end game,” said Barbara Ashe, executive vice president of the chamber. “It is our hope we can actually make a difference in 12 months.” “In Maryland, we previously haven’t put the networks in place to support a federal contracting community,” said Larry Davis, a partner with the Rockville investment bank Aronson Capital Partners LLC and a member of the Government Contracting Network’s organizing committee. “Typically if you want to attend networking events or information sessions about federal contracting, you have to drive across the river to Northern Virginia.” Realizing that Montgomery County companies are most likely to compete for information technology contracts, the network has already scheduled information sessions with the chief information officers of the National Aeronautics and Space Administration, the Department of State, the U.S. Army and the Army Corps of Engineers. It is also organizing sessions on core back office topics for federal contractors, such as accounting systems, digital time sheets and other pieces of information technology needed to meet reporting requirements on federal jobs. “A lot of small businesses have their heads down and their elbows up, working hard at what they do well, and they don’t have those back office procedures in place,” said Joe Jezior, a principal with TBS Technology and Business Solutions in McLean, Va. and a member of the network’s organizing committee. “We want to give people a roadmap to good business infrastructure.” That infrastructure can do more than help companies comply with daunting federal requirements, he said. “A lot of companies that get into government contracting are shocked by the level of tracking involved. But once they get into that tracking, they end up converting their commercial business to that system too because [it] helps them identify efficiencies and improve their profit margins,” Jezior said. Organizers hope the network’s events will also help businesses find companies to partner with on federal bids and learn about challenges other contractors have faced, Ashe said. Federal contracts, which typically run five years, can give small businesses steady income, said Arnold whose company has landed $100 million in federal work since 2000. But it can take 18 to 24 months to develop the connections, knowledge and bid to win a single contract, he said. And those efforts can easily be thwarted by political whims. Master Key, he said, spent years meeting with Indian Health Service officials in Washington, Texas and New Mexico in an effort to land a contract. Just as the contract was to be bid, however, the department cancelled the project. Even winning a bid can create challenges for a small company. In 2005, Master Key won its largest contract to date — a $30 million deal with the National Institutes of Health (NIH). A 40-person shop at the time, Master Key needed to hire another 40 people in six weeks to handle the work. “You’re trying to double your company in less than two months and you don’t even have an HR department because as a small company you couldn’t afford one,” Arnold said. “But those are the kinds of problems you want to have.” |
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