Protecting Your Small Business When Seeking Business Partnership Opportunities

Whether you are a small business that is starting out or one that has been around for several years, at some point it becomes essential to make and establish partnerships along the way with companies that will add value or be an arm extension to your business. Most firms to have the innate fear of setting up partnerships because they feel like they don’t know other firms as well, they’re afraid to give away too much information, or they just don’t want to be taken advantage of by other firms. While these are valid and understandable fears, there are actions you can take to protect the integrity of your valuable information, your resources, and your products. Creating partnerships often allows small businesses to take on projects they would not have been able to qualify for on their own, allows them to gain marketing momentum, and also share on some of the costs of doing business.

Before you enter into any detailed conversations with another business regarding partnership opportunities, value-added services, products you offer, and types of resources at hand, the first piece of legal documentation you should request to sign is a Non-Disclosure Agreement (NDA) or Confidentiality Agreement (CA). Essentially, this agreement signed by both parties delineates the key items that both parties will be protecting, such as technical documents, intellectual property, business processes, client or project specific information, confidential information (CI), etc. By signing this agreement, both parties agree to discuss confidential information about their business and both agree not to disclose the information shared for a specified period of time.

Once you and the prospective business partner have agreed that the relationship would be of mutual benefit to one another, it is advisable that before you begin executing any business activities that you set the terms of the business relationship with a partnership agreement. This can be in the form of several types of agreements, the most common to include:

• Teaming Agreement (TA) for joint ventures
• Subcontractor Agreement (SA) for services one partner will provide another
• Master Services Agreement (MSA) for setting terms of future transactions
• Reseller Agreement for allowing one partner to resell products/services of the other partner

You should always seek professional legal advice prior to signing any contracts and prior to attempting to write one on your own. As a small business, capital resources may be limited, so as an alternative, instead of procuring legal assistance for every contract you sign, it may be helpful to procure the assistance of a lawyer to provide a set of templates of such contracts that you can use on multiple occasions. Again, depending on the subject and terms of the business partnership, you will need to use your best judgment and seek legal advice. However, don’t let the fear of partnering with another business stop you from seeking new opportunities. These opportunities can be very rewarding in many aspects and will allow you to build your business in ways you may not otherwise be able to with the resources and capital at hand.

Wendy Dueri is the Director of Business Operations for JHC Technology.  She can be reached at wdueri(at)jhctechnology.com or connect with her on LinkedIn.

How to Find an Entity’s Small Business Status on SAM.gov

In 2012, the Federal Government released SAM.gov in an effort to consolidate CCR/FedReg, ORCA, and EPLS. The System for Award Management, better known as SAM, provides access for all types of companies to create business records that describe their business types, service and products offerings, and allows the Federal Government to engage and do business with these corporations in a more streamlined manner.

Recently, JHC Technology, Inc. submitted an RFP to a Federal Government Agency. As we hope all contracting officers do their due diligence, the reviewing contracting officer from the agency contacted us to verify our small business status. Having previously successfully registered our small business with SAM and being a SDVOSB verified by the Department of Veterans Affairs, we all looked at each other with a raised eyebrow and asked the same question – why can’t the contracting officer just look up our small business status on SAM.gov and figure out that we really are a small business? It turns out that the answer is not clearly evident on any company’s profile in SAM. It actually requires the contracting officer, and anyone else looking for this information, to dig a bit deeper into the site to find out.

SAM does not actually post the small business concern in the general information tab of a company’s profile because the small business classification depends on the North American Industrial Classification (NAICS) code the business utilizes. In SAM, each NAICS code has a revenue cap assigned that determines whether a company is considered a small business under that code. So while you may consider yourself a small business under the SBA general standard, SAM has a different classification in mind.

So, how do you find an entity’s small business status?

1.      Go to https://sam.gov

2.      Search for the entity under “Search Records”

3.      In the next screen, enter either the company name, the DUNS Number or CAGE Code for the business you are trying to find.

4.      On the search results page, click on “View Details” for the entity you need to view

5.      In the left menu bar, click on “Reps & Certs”

6.      Scroll down to 52.212-3 or 52.219-1 and click on the provision. In some browser versions, this does not appear to be a hyper link. Scroll your mouse over the provision and click on it anyway and this will expand the record.

7.      Scroll down to view the NAICS table, where you will see listed the company’s NAICS  code, name of the code, any exemptions, the revenue size standard that sets the cap for small business, and whether the company is a small business under that particular NAICS code.

Additionally, written under the table in section (1) and (2), you will be able to see if the business is a small business as a whole as well as whether the business is a veteran owned small business. Below is a sample of the NAICS chart you will see:

 

According to SAM, contracting officers are required to check the certifications created by each business when considering a contract award. While it may be understandable for many reasons why each contracting officer needs to complete this verification, it begs the question of whether the Federal Government has educated and trained the contracting officers on the use of their brand new site. Luckily, our contracting officer contacted us to inquire about our small business status, however, I think we would have all been very disappointed if we lost this bid based on the unclear nature of the SAM site.

Wendy Dueri is the Director of Business Operations for JHC Technology.  She can be reached at wdueri@jhctechnology.com or connect with her on LinkedIn.