The federal government spends over $750 billion on contracts every year. State agencies across the country spend hundreds of billions more. And the U.S. has roughly 3,000 counties, 13,000+ school districts, and 19,000+ municipalities — plus water districts, hospital districts, transit authorities, and community colleges — all buying from private businesses every single day.
These three markets — federal, state, and local — are not the same market. They have different portals, different certifications, different timelines, and completely different buyer behaviors. A strategy that works in federal contracting can be entirely wrong for state procurement, and a state playbook will get you nowhere in local government.
By the end of this module, you will know which market — or combination of markets — gives your specific business the clearest path to a first win.
Federal. State. Local. Three buying systems that move at different speeds, follow different rules, and reward different strategies. If you've sold to a Fortune 500, a regional firm, and a local school district at some point in your career, you already know that markets behave differently — the same is true here, with higher stakes and more paperwork.
DoD, VA, GSA, DHS, NASA, and hundreds more. Every contract over $25,000 must be posted publicly. Largest dollar values, most small business programs, and the most formal process.
Portal: sam.gov
Every state has procurement agencies that buy through a centralized portal — TxDOT, HHSC, DIR in Texas; NCDOT, NC DHHS, ITS in North Carolina; Caltrans, DGS in California. Lower competition than federal, faster timelines (30–60 days), and most states run small-business certification programs that unlock category-specific spending goals or evaluation preferences.
Portal: Your state's centralized procurement system (e.g., Texas SmartBuy/ESBD, NC eVP, Cal eProcure)
Cities, counties, school districts, hospital districts, water authorities, transit agencies, community college districts. The most overlooked market — and for new businesses, often the best place to win your first contract. Local entities typically run procurement through one of a handful of national platforms.
Portals: Bonfire · IonWave · OpenGov · BidNet Direct · DemandStar
Review federal and supported state/local notices matched to your profile. Eligible matches can arrive by email. Check the original notice before deciding what to pursue.
Every state has a substantial federal footprint — military installations, VA medical centers, federal civilian agencies, NASA centers, national labs, research facilities. Your state has its own list. Pull up USASpending.gov, filter to your state, and you'll see exactly who's buying within an hour's drive of where you live.
Micro-Purchase Threshold ($10,000): No competition required. A contracting officer can buy from whoever they choose. This is where relationships matter most — and where new businesses can win fast before they have much past performance.
Simplified Acquisition Threshold ($350,000): Lighter requirements, fewer administrative hurdles, far more accessible to new businesses. Your first contract target should almost certainly be under $350,000 — ideally $50,000–$150,000. That range is competitive enough to build real past performance, small enough that agencies aren't running a 12-month procurement process.
Every federal contract over $25,000 must be posted on sam.gov — that's a legal requirement, not a suggestion. Which means if you have your search alerts set up correctly, you'll see every relevant opportunity the moment it posts. That level of market visibility simply doesn't exist in commercial sales.
Higher contract values, more formal requirements, longer timelines. If your services are technical and you operate nationally, federal is likely in your future — but may not be your right starting point.
The U.S. has roughly 19,000 incorporated municipalities, 3,000+ counties, 13,000+ school districts, plus thousands of special-purpose entities — water districts, hospital districts, transit authorities, community college districts. All of them buy constantly. Most contractors ignore the entire layer.
Most contractors focus exclusively on federal. Local contracts sit in a far less crowded competitive environment.
Solicitation to award is often 3–8 weeks vs. 6–12 months federally. Get your first win on the board faster.
You can meet the procurement officer in person. Relationships are built face-to-face, not through formal channels.
Local contracts are often $20,000–$150,000 — the ideal range to build past performance and cash flow.
Key portals: Bonfire (used by hundreds of local entities including counties, cities, and school districts in NC, CA, GA, AZ, and beyond) · IonWave (large school districts and county governments across the South and Midwest) · OpenGov (Boise ID, Carmel IN, smaller cities and special districts nationwide) · BidNet Direct and DemandStar (aggregators covering tens of thousands of local entities across all 50 states)
Understanding the government's buying process tells you exactly where to invest your energy. If you've ever been part of a corporate budget cycle — someone identifies a need, gets it approved, runs it through procurement, vendors respond — you already know the rhythm. Government does the same dance with different titles and more paperwork. Here's the six-phase version.
Most contractors only see opportunities when they hit Phase 3 (the solicitation drops). By then, Phase 1 and 2 have already happened — the program manager has written the SOW and a Sources Sought has come and gone. The Coming Back to Market feed in your Intelligence Pipeline shows you federal contracts that agencies have disclosed will recompete in the next 12–36 months. That's contracts in the Phase 1–2 window, before any Sources Sought drops. The incumbent is named. The contract value is known. The expected award date is published. You position now — not when the RFP forces you to react.
Three people determine your fate at every agency. If you've ever navigated a corporate sales cycle, you know the difference between the user (who has the problem), the champion (who advocates internally), and the buyer (who signs the contract). Government works the same way with different titles and tighter rules about when you can talk to whom.
Every federal agency is required to have one. Their job: connect small businesses with upcoming contracts. They know what's coming before it hits sam.gov. This is your first call at any new agency. Find them at osdbu.gov — the government-wide directory of every agency's Office of Small Business Programs — or search "[Agency Name] Office of Small Business Programs."
The government employee who has the problem your business solves. They influence — and often write — the requirements in the solicitation. Meeting the PM before the RFP is released is the highest-value activity in business development. A PM who knows your name is a competitive advantage no proposal skill can replicate. The path to the PM: start with the SBS → attend agency industry days → respond to Sources Sought notices (the CO shares your response with the PM) → request a capability briefing. Each step earns the next.
The only government employee legally authorized to sign contracts and obligate funds. COs are regulated during active procurement — all questions go through formal Q&A once an RFP releases. Before the solicitation: they can meet with vendors freely for market research. One distinction new contractors get wrong: after award, your day-to-day contact is typically the Contracting Officer's Representative (COR) — a government employee assigned to monitor your work, approve invoices, and document your performance. The CO retains legal authority; the COR manages the relationship. Always know who your COR is.
Use this as a starting point. As your business grows, you'll pursue multiple markets simultaneously.
| If your business… | Start here |
|---|---|
| Sells IT, cybersecurity, or consulting | Federal civilian agencies (VA, GSA, DHS), then your state's IT procurement office (e.g., Texas DIR, NC ITS) |
| Does construction, facilities, or maintenance | Local government — cities, counties, school districts, hospital districts in your region |
| Sells products, supplies, or equipment | Your state's centralized procurement portal, then sam.gov + GSA Schedule later |
| Is veteran-owned (service-connected disability) | VA — has Veterans First policy; SDVOSB set-asides across all agencies |
| Is woman-owned (51%+ ownership) | WOSB set-asides federally + your state's small-business certification for state work |
| Is SBA 8(a) certified or actively pursuing it | 8(a) sole-source contracts up to $4.5M (services) / $7M (manufacturing) — bypasses competition entirely. Covered in Module 5. |
| Is brand new to government contracting | Local government first — faster timelines, lower competition, right-sized contracts |
Go to usaspending.gov and search your NAICS code. Filter by your state. Look at the 10 most recent contract awards in your space. Which agencies bought it? What did they pay? Who won it? When does the current contract expire? This 20-minute exercise will tell you more about your market than most contractors learn in their first year. Pro tip: a contract ending in the next 6–18 months is a live opportunity — the agency is already planning its re-competition. The incumbent isn't guaranteed to win. Get on that agency's radar now, before the solicitation posts. (The Intelligence Pipeline's Coming Back to Market feed automates exactly this search and surfaces matches against your profile daily.)
Not sure which market is right for you, or want to talk through what you found on USASpending? Alex can help you interpret the data.
A real scenario from the field. No answer permanently locks you out — but the consequences below are real. Choose one, then see what unfolds.
You run a small IT support company. A county purchasing manager emails you saying they need your services, the budget is $28,000, and you should just send a quote and they'll get it approved. No formal RFP is mentioned. You're excited — this feels easy.
Make a choice above, then continue to the knowledge check.
Three quick questions to lock in what you just learned. Click any answer — right or wrong, you'll see the full explanation. The goal is retrieval, not a grade.
Module 2 covers the business setup steps that unlock your eligibility — legal structure, EIN, banking, and the financial infrastructure agencies will verify before awarding you a contract.
Before you move on, make sure you've picked your target market and agencies. Alex can help you pressure-test your choices.
1. NAICS Check — You picked your target market. Now you need the codes that match your business in that market. NAICS Check finds them in 60 seconds. Without the right NAICS codes, agencies looking for what you sell can't find you in SAM.gov, and the Opportunities Feed can't match opportunities to your profile.
2. Exclusions Check — A 30-second precaution before you spend any time on registration or bidding. Confirms you (and any company you've acquired) are not on the SAM exclusions list. Most contractors skip this and discover the problem after they've already invested in a proposal. Don't be most contractors.
3. My Journey — Log your target market choice and the 3 agencies you named. The course tracks your progress against the bootcamp from here forward, surfacing the next right action when you're stuck.
The Intelligence Pipeline in your dashboard surfaces signals that operationalize what Module 1 just taught you. Two feeds matter most right now:
Coming Back to Market — federal contracts agencies have disclosed will recompete in 12–36 months. This is Phase 1–2 of the buying process surfaced before any Sources Sought drops. The incumbent is named. The expected award date is published. You position now, while the CO is still doing market research.
Contract Vulnerability — once you know your three markets, this feed shows incumbents at risk (poor CPARS, WARN Act layoffs, agency dissatisfaction signals). A vulnerable incumbent is a leading indicator for a faster, more competitive recompete.
Most contractors only see opportunities when they go to bid. Pipeline subscribers see them when the contracting officer is still inside the agency, writing the SOW. That's the entire competitive edge.
Module 2 covers the legal, financial, and operational setup the government will verify before awarding you anything. Get this right once — and it stays right for years.
Module 2: Business Foundation →