Our proximity to the capital puts us in a unique position in the business world. Many businesses in Northern Virginia and Maryland provide services to the U.S. government in some form or another. These often lucrative contracts give businesses a steady workflow and a placeholder in the local market. While servicing a government contract can make business interesting, earning the contract is a feat in itself. How do businesses obtain government contracts?
When looking at who is awarded government contracts, a study published in Small Business Economics shows that business owners who are among a social, racial or ethnic minority group are less represented than their white counterparts. According to the 2010 U.S. Census, 52 percent of people in the Washington D.C. metropolitan area fall into one of four minority groups. Why are minority business owners underrepresented in the world of government contracts?
People in minority groups may have access to fewer life resources
SBE points out that individuals in minority groups often do not have the same educational opportunities, access to financial resources or social networks to pursue business careers as Non-Hispanic Whites. These factors lead to fewer minority business owners with access to fewer resources.
Language in the Small Business Act of 1963 encourages the government to seek out contracting opportunities with minority-owned businesses, but factors within the contracting market itself often work against this notion. Minority businesspeople are also competing with veteran-owned groups who are given the same opportunities and other businesses that use short-term tactics to take advantage of the system, according to SBE.
How can minority business owners better their chances at earning a government contract?
Diversity in business ownership creates a market with unique offerings. Business owners who understand their market and the unique selling proposition of their company are often in the best place to stand out among the businesses vying for more than 30,000 contracts, according to Inc.
The next challenge for business owners comes in understanding the contract itself. While owners know the nature of their business, the legal benchmarks that come with fulfilling a contract may not be as easy to comprehend. When this challenge arises, local business owners can count on the help of a business law attorney.
Understanding the inherent challenges of owning a business can put minority owners in a better position to compete for government contracts.