Finding new customers is one of the biggest challenges faced by any businesses, especially in a challenging economy like we're facing today. So what if we told you that one of your largest potential clients could be as close as your nearest city hall or county or federal courthouse?

Each year, government entities at the local, state and federal levels award hundreds of billions of dollars in contracts to businesses in practically every industry under the sun. If you haven't considered working with the government, you could be missing out on a steady stream of income from a reliable customer.

At the Federal Level

In 2006, small businesses won a total of $77 billion in federal contracts, or 23 percent of the $340 billion in federal government contracts that was eligible for small business competition. Unfortunately, fewer than three percent of all small businesses nationwide participate in government procurement programs. Many believe there's too much bureaucracy and red tape involved in dealing with the government, or they simply aren't aware of the many opportunities that exist.

Recently, however, the federal government has actively pursued a more small-business-friendly strategy. For example, each federal agency now has goals for working with small businesses. In addition, request for proposals (RFPs) and request for quotes (RFQs) have been simplified and shortened – from up to 30 pages to as short as nine or 10 paragraphs.

There are a number of online resources available to help you get in the federal procurement game, including:

• Federal Business Opportunities, or FedBizOpps.gov is the federal government's one-stop virtual marketplace – a single point of entry through which businesses can post, search, monitor and retrieve procurement opportunities solicited by the federal contracting community.

• PRO-Net/CCR is the primary contractor database for the federal government, where registered users can search for government contracts up for bid.

• The Federal Procurement Data System-Next Generation maintains a database of millions of government procurement transactions going back decades. Here, you can order reports detailing what the federal government has bought from whom and for how much, where items were manufactured or services were performed, and more.

• Procurement Technical Assistance Centers provide training, seminars, one-on-one guidance and matchmaking events covering every phase of government contracting, at little or no expense. PTACs helped businesses win more than $14 billion in federal government contracts last year.

At the State and Local Levels

Here in Georgia, there are numerous opportunities for companies to do business with state and local government entities.

This starts with the state's Vendor Registration System, a free web-based system provided by the Department of Administrative Services' State Purchasing division that enables vendors to complete a profile and identify their products and services. The system uses the National Institute of Governmental Purchasing (NIGP) codes for easy registration and identification of vendor products and services.

Both state and local government entities can search the VRS by commodity, service, geographic location and small or minority business status. Vendors can opt to be notified via e-mail when bids and procurement opportunities that meet their specifications become available.

In addition, state and local government entities post contracts on the Georgia Procurement Registry, which vendors may access free of charge to search for new business opportunities.

Living in the Government Space

AnyTransactions, Inc. is a small Decatur-based tech company that specializes in providing voice recognition solutions, including a monitoring device for electronic supervision called roboCUFF. "We live in the government space – state and local government entities are our primary customers," says Vice President of Research & Development Chuck Johnson.

For companies that are new to government procurement, Johnson recommends starting out small, at the regional or county level. "This helps you get established in the government realm; then through experience and word of mouth, you can get more exposure at the state level. The bidding process is also more flexible – if the purchase is under a certain dollar amount, the entity might be able to hire you without a bid."

As you'd probably guess, price is a big factor with government entities – you should be prepared to sharpen your pencil, shave your costs and perhaps earn a little less profit that you normally would. But it's not the only factor, says Johnson: "Government entities are usually required to look not only at price, but also at the size of the company, how many years it has been in business, and its experience in delivering on the scope of the particular project."

Johnson says it's important to understand the entity's budget cycle so you know when to submit your bid. "In the government space, everything runs on yearly budgets, so make sure you know when budgets are finalized so you submit your bid on time. And be prepared for a longer sales cycle than you may be used to."

It's also critical to know who the decision-makers and influencers are. "This could be people out in the field or on the front lines – maybe lower-level people than you might think," says Johnson. "Also, make it as easy as possible to implement and integrate your solution. Most of these people are extremely busy, so your solution needs to be easy to understand and cause minimal disruptions. Have a compelling reason for why what you have to offer is better than what they're currently doing."