How to win your first federal contract

The federal government buys almost everything a business can sell — software, gravel, translation, catering, lab equipment, roof repair, training, uniforms, IT support. It spends hundreds of billions of dollars a year doing it, and by law a meaningful share of that is supposed to reach small businesses. None of that makes the first contract easy. It makes it available, which is a different thing.

What follows is the sequence that actually works, in the order it actually happens, with honest time estimates. The single biggest reason new contractors fail is not that they lose bids. It's that they run the steps in the wrong order and give up during the gap.

Step 1: Register before you need to (allow 1–4 weeks)

You cannot be awarded a federal contract without an active registration in SAM.gov. Registration is free. It is also slower than you expect, because it involves validation against IRS and banking records that you do not control the pace of.

Start it now, before you have found an opportunity you want. Contractors who wait until they see a solicitation with a three-week deadline discover that their registration will not clear in time, and they sit out the one opportunity that got them interested in the first place.

You will need your legal business name and physical address exactly as they appear on your IRS records, your EIN, your bank routing information, and a rough idea of your NAICS codes. You will come out the other side with a Unique Entity ID (UEI) and a CAGE code. Both are free. Anyone charging you several hundred dollars to "handle your SAM registration" is a reseller, not the government — this is one of the most common scams aimed at new contractors.

See our SAM.gov registration guide for the step-by-step version.

Step 2: Decide what you are actually selling (1 day)

This sounds obvious and it is where most new contractors are vague. "We do IT" is not a market position. "We do Microsoft 365 tenant migrations for organisations under 500 seats" is.

The reason precision matters here is mechanical: the entire federal opportunity system is indexed by NAICS code. Your codes determine which opportunities you see, whether you count as a small business for a given solicitation, and how a contracting officer classifies you when they go looking for someone like you.

Pick a primary code that genuinely describes your core revenue and a handful of secondary codes for adjacent work you can credibly deliver. Do not list twenty codes because they are free to list. A capability statement claiming twenty unrelated competencies reads as a company with none.

Our NAICS code finder will get you to candidates from a plain-English description, and the guide to choosing NAICS codes explains the size-standard consequences, which are the part people miss.

Step 3: Aim much smaller than you think (ongoing)

This is the step that changes outcomes.

New contractors go looking for the biggest opportunity they can plausibly perform. It's a natural instinct and it is close to the worst possible strategy, because large competed contracts are exactly where you are least competitive: they are usually recompetes with an incumbent who has been performing the work for five years, has the relationships, has the pricing history, and has past performance you cannot match.

Federal purchasing has thresholds, and they matter enormously to a new entrant:

• Below the micro-purchase threshold (currently $10,000 for most supplies and services), a government buyer can simply buy from you. There is no competition requirement in the normal sense. A government purchase card transaction is a real federal contract.
• Between the micro-purchase threshold and the simplified acquisition threshold (currently $250,000), acquisitions are, with limited exceptions, reserved for small businesses, and the procedures are dramatically lighter than a full competed procurement.
• Above the simplified acquisition threshold, you enter the world of formal source selection, evaluation factors, and proposals measured in tens of hours.

That middle band is the on-ramp. It is where a company with no federal past performance can compete on merit, price and responsiveness rather than on a five-year track record. Sort by value and work upward — do not start at the top.

Thresholds are set in the Federal Acquisition Regulation and are adjusted for inflation periodically, so confirm the current figures on acquisition.gov before you rely on them.

Step 4: Find opportunities systematically, not occasionally (30 minutes a week)

The failure mode here is checking for opportunities when you happen to think of it, which means you find things with four days left on the clock.

Set up a repeatable weekly sweep:

1. Search your primary NAICS codes for open contracts and note anything closing in the next 30–45 days.
2. Search awards in your codes — not just open opportunities. Awards tell you who your real competition is, what these contracts actually go for, and which agencies buy what you sell. This is the single most under-used data source available to new contractors.
3. Watch for sources sought notices and requests for information. These are pre-solicitation market research. A sources sought notice is the government publicly asking "are there small businesses who can do this?" — and your response to it can directly influence whether the eventual solicitation is set aside for small business at all. Responding costs an hour and it is the cheapest possible way to shape a procurement in your favour.

On this site, browse by NAICS, by agency, or by set-aside program, and use closing soon as your weekly deadline check.

Step 5: Get certified only if it fits (0–12 months)

Set-aside certifications — 8(a), WOSB/EDWOSB, HUBZone, SDVOSB — restrict competition to a smaller pool. They do not win contracts. They change the number of companies you are competing against.

Do not build a strategy around a certification you do not already qualify for. Do pursue one you do qualify for, because the effort is front-loaded and the effect is permanent for the term of the certification. Our set-aside programs guide compares them honestly, including which ones are worth the paperwork.

Step 6: Bid selectively and write to the evaluation criteria (per opportunity)

When you find something worth pursuing, the discipline is simple and almost nobody follows it: read the evaluation criteria first, and write your proposal to those criteria in the order they are listed.

A federal proposal is scored by an evaluation team working from a specific set of factors. They are not reading for narrative quality. They are looking for the thing they are required to score, and if they cannot find it quickly, you lose points you actually earned. Our guide on reading a federal solicitation covers this in detail, and the bid/no-bid framework covers what to walk away from.

What the first year realistically looks like

Here is the honest timeline, based on the pattern that repeats across new contractors:

Month	What's happening
1	SAM registration submitted, NAICS codes chosen, capability statement drafted
2–3	Registration active. Weekly opportunity sweeps begin. First sources-sought responses. Nothing has been won.
4–6	First real bids submitted. Probably lost. Debriefs requested and read.
6–9	First small win — often a simplified acquisition, often smaller than hoped, often from an agency you had a conversation with.
9–12	That win becomes citable past performance. The second bid is meaningfully stronger than the first.

The gap at months two to five is where most companies quit. It looks like nothing is working. What is actually happening is that a pipeline is being built and none of it has matured yet. The companies that succeed are, more than anything else, the ones that were still running weekly sweeps in month six.

Three things that shorten it

Talk to people before the RFP. Contracting officers and small business specialists at agencies are allowed to talk to you during market research, and most agencies have an Office of Small and Disadvantaged Business Utilization whose actual job is to help small businesses find their way in. Use it.

Subcontract while you wait. Large prime contracts generally carry small business subcontracting plans, meaning the prime has goals it is measured against. That is real federal past performance, obtained faster. See subcontracting as a way in.

Always request a debrief. When you lose, you can ask why, and on most competitive awards the government will tell you. There are short deadlines to request one — typically a few days after notification — so ask immediately. A debrief on a lost bid is the highest-quality feedback you will ever get, and it is free.

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ContractBeam aggregates public federal opportunity data. It is not affiliated with any government agency and this guide is general information, not legal or acquisition advice. Thresholds, program rules and deadlines change — verify anything you're about to rely on at sam.gov, acquisition.gov or sba.gov.