Federal Government Contracts Under 25,000 for Small Businesses - How the Government...
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How the Government Awards Smaller Contracts
The federal government procurement system for contracts under
$25,000 isn’t overly extensive or competitive. The government
generally makes hiring decisions for smaller contracts through
micro purchases or simplified acquisitions. Both of these
methods are relatively streamlined, compared to the more formal
process of requests for proposals, quotes and invitations.
Micro Purchase Market
The micro purchase market enables federal managers in the field
to buy goods and services under $2,500 quickly and easily.
Managers normally make these purchases with a government credit
card, although a purchase order can also be used. Government
credit cards—GSA SmartPay cards—are widely used and are the
government preferred method of payment.
Accepting credit card payments offers government contractors a
variety of benefits. It eliminates the use of purchase orders,
which means fewer forms to complete. It speeds up payment
processing and reduces billing, collection and other
administrative costs. But more importantly, accepting GSA
SmartPay, allows companies to remain competitive and become
strategic suppliers to government purchasing card users.
Using credit processing to capitalize on the micro purchasing
system is easy. You simply set up a merchant account that
allows you to accept credit cards. Then conduct business with
your local federal agencies the same as you would with your
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