As of June 1st, Tech BizSolutions, Inc. has merged with PBC, Inc of Denver to form a new company called ReliAscent, LLC. ReliAscent will still offer all of the same services that Tech BizSolutions and PBC offered individually. In addition, ReliAscent will offer services based on the synergy of bringing these two successful organizations under one roof. For instance, PBC has very detailed technical accounting knowledge to add to the Tech Biz accounting knowledge base. Tech BizSolutions has a wealth of contract management knowledge to add to the base of PBC's knowledge of government contracts. PBC has focused on the SBIR/STTR market in the past and brings intimate knowledge of this contract vehicle to the offering. Tech BizSolutions has offered services to all types of government contractors including Broad Agency Announcements, IDIQ contracts, GSA schedules, Seaport-e contracts, EFAST contracts and other contracting vehicles. PBC brings a strong working knowledge of the 8(a) program and other specialized contracting vehicles.
DCAA COMPLIANCE BLOG
Your Source for DCAA News and Government Contracting Information
How do small businesses survive in the world today, especially when they are primarily government contractors? The government has such a twisted path of regulations concerning contractors and then they control the amount of fee or profit that the small business can earn. There is definately a cost in doing business with the government that many businesses don't realize when starting. One of the constants we have noticed over the years is that experience in government contracting makes a difference. Small businesses usually can't afford to hire someone with experience on their staff but they can hire a consultant and outsource this experience level on an "as needed" basis. We have found that fully outsourcing back office services such as bookkeeping, accounting, payroll, contract management and even HR or purchasing can be valuable to the small business. This allows those services to be performed by "experts" in the area and allows the members of the small business to focus on the tasks that they are experts at - thereby increasing their value to the bottom line. A web hosted accounting system is a great tool for this scenario because both the outsourced consultant as well as company management can access the financial records at any time. The following video outlines some of the benefits of such a web hosted solution, just imagine the cloud shared application is your accounting system!
- Cash flow: Cash flow is the lifeblood of a small government contractor or subcontractor. Managing cash for a small government contractor requires knowledge of government contract types and specific clauses related to contract payment. Negotiating the most favorable terms may mean the difference between long term success or failure of the contract and possibly even the firm.
- Pricing: Pricing in the proposal stage of a contract is crucial. Knowing how to leverage government cost rules when budgeting and pricing new proposals will directly affect cash flow after the award of the contract. With all the FAR regulations and other flow-downs on most government contracts it is critical that the small business has an expert CFO that can anticipate and construct pricing models that will be in the best interests of the firm going forward.
- Compliance: Depending on your mix and dollar amounts of the contracts, your financial and business systems may be heavily scrutinized by the government. Most small businesses simply don't have the expertise to survive the scrutiny if it focuses on your firm. An experienced outsourced CFO can provide that expertise and stability.
- Profitability: Success as a government contractor means monitoring profits and threats to performance on a job-by-job basis. Understanding the special contractual obligations imposed by government work is key to assuring this success. Understanding all of the government's complex matrix of requirements and applying them strategically can also lead to the maximization of a limited "fee" under government contracting guidelines.
- Company Vision: An outsourced CFO provides a "second set of independent eyes" on your business that assures the best possible long term strategy. This helps control costs because you pay for only the CFO duties that you need and don't need to pay 6 figures to receive the benefit of this position. A part-time CFO makes you look "bigger" and helps assure the government of your ability to survive and grow in the market. Also, by hiring a consultant you may have the benefit of more than one CFO at the outsourced agency that can "poll" their ideas and strategies resulting in a better final strategy for the small business. To top it all off, this is an allowable expense for government contractors.
The government plans to cut $2.4 Trillion from the budget over the next 10 years, beginning in the 2012 budget. It is expected that up to $900 Billion in cuts could be included in the 2012 budget. The Defense department could see over $28 Billion in cuts in 2012 with an expected $350 Billion over the next 10 years. Federal agencies and departments are "running scared". Contractors should be too as many current programs either will not exist or may exist in a reduced form in the next budget. The Federal Budget is a large pendulum that swings from one extreme to the other. We have enjoyed almost 10 years now of increased spending that can only be viewed as a boom. Now there is a correction. Sometime in the future the pendulum will swing back, we need to survive in the meantime. Here are 5 strategies that small businesses can use to help mitigate their risk in this uncertain time;