Sandra Walls is President and CEO of AIL Logistics Solutions, a multimillion-dollar, Memphis-based, service-disabled veteran-, woman- and minority-owned company that provides diverse logistics and technical support solutions to government and commercial clients. A retired Lieutenant Colonel in the United States Air Force, Ms. Walls joined the company after serving 22 years on active duty as a logistics officer, managing supply and fuels accounts while making military history everywhere she commanded. She offers a real-world perspective on government contracting based on leveraging her military experience and built on doing what it takes to excel.
Q: What propelled you into the government-contracting world?
It was a carryover of my military experience; I was in the Air Force for 22 years. I’ve worked in a contracting agency. And my goal in developing my business was to take what I learned on active duty and continue providing those services in a for-profit capacity. Our company was first established by a group of military veterans with the intent of supporting and providing organic support capabilities to the Department of Defense (DOD), primarily in the fuels arena. Our plan from the beginning was to engage in federal business, primarily with the DOD. The business has continued to evolve, although we have diversified and are doing commercial business as well.
Q: How difficult is it to become a government contractor?
It’s actually easy to become a government contractor. You register your business by first obtaining a Dun and Bradstreet number and then entering your business information into SAM.gov, the primary database for vendors doing business with the federal government. That’s a piece of cake. The challenge, as in the commercial world, is doing all of the things required to operate and market your business. The government process can be a little bit longer, and it’s very, very intensive. But once you get started, and you get to understand the process, it becomes easier.
Q: What advice would you give someone who is considering orienting their business toward earning government contracts?
There are pros and cons. On the government side, there are some benefits. For example, when others were having problems during the recession, and most of my business was with the federal government, my contracts did not go away. The worst case is when we do go through budget issues and they still don’t make decisions, but rarely have I had any of my contracts impacted dramatically.
There are other things they do well. When larger companies offer a request for proposal, some are less detailed in specifying what they want to see. For example, government contracts will specify the minimum items expected in a response to their RFP. They also provide their criteria on which they’ll evaluate you. If you miss all that, then it’s bad on you, because they’re telling you upfront what their expectations are. In the commercial world, they may not do that. So oftentimes, when bidding as a small business, people may get thrown out because they don’t have that level of depth and experience in understanding how to write an effective, winning proposal.
However, on the commercial side, I don’t have to deal with the tons and tons of paperwork. I don’t have to wait months for an answer on whether or not I will bid. I don’t find it a challenge waiting on budget decisions to know when I will make an offer. It’s not as painstaking a process.
Q: Do companies that work with the government have a pretty even balance between government contract and other work, or do a majority focus on one area or the other?
Based on the companies I’ve dealt with and met, there’s not a lot of diversity. They’re either all commercial or all federal. On the federal side, there are some programs based on designations such as 8(a) certified small-business, woman-owned, veteran-owned, disabled-veteran owned, minority-owned, Native American-owned, etc. The government must set aside a certain percentage of contracts for businesses with these designations. 8(a) is a wonderful nine-year business development program – I graduated from it last year. It’s another opportunity to grow your business.
But oftentimes, a lot of business owners get into that space and don’t venture outside it. They don’t diversify into the commercial side, so when they graduate from the program, they’re not prepared to compete in the outside world. Some are not following through on its guidance or recommendations, because the program is really structured to support your transition from reliance on 8(a) sole-source contracts. It encourages you to compete in different environments and to diversify your business in both federal and commercial markets. And there’s a plan you should submit nearly every year to address how you’re going to do that.
Q. What types of contracts are most important to your business?
Most of my business is now coming from the commercial side, whereas before more of my business was coming from the federal. I’ve got both sides that I’m working at the same time, and I now have one person who does the government contracting and another who works the commercial contracts.
Q: What are your thoughts on prime contracts? Are they worth pursuing?
They’re worth it. Being a prime contractor is good in that you’re the train driver. I prefer to grow and to be respected as a prime contractor – to stand on my own, to be able to do what I have to do. As you build your experience and your past performance, you’re better positioned to go out on your own, rather than depending on someone else to get you in the game. I’m not against being a subcontractor at all, as long as the money is there, and I’m allowed to do my job. Regardless of whether I’m a prime or a subcontractor, I focus on making sure I’m serving my client and giving them the quality of support and service that they deserve.
Q: What is the value of being a subcontractor versus a prime contractor?
It depends on where you are and the nature of the work you’re doing, but I think it’s always a good idea to try to do some subcontract work. It helps you learn what’s involved, and it’s important to diversify your business. There are definite advantages to being a sub. Work to build a relationship with a prime contractor so that wherever they go, they take you with them. I know a woman in Texas who has grown her business just by being a subcontractor. She’s operating in the $50-$60 million range by forging those relationships.
Part of our strategic goals has been to team with people in reciprocal relationships, where I can be a subcontractor to them, and they can be a subcontractor to me. Large businesses typically cannot bid on a small contract unless they’re in a joint venture/protégé relationship. It pays to position yourself with a company where you can have that reciprocal relationship. That’s ideal.
Also, when you meet a prime contractor, like a large company that’s willing to make you part of their team, make sure you don’t get boxed in. If they see you as a supplier of only one kind of product or service, you’ll end up a one-time player. They should have the confidence in your skill set and your ability to do the work to keep you in their bids.
Q: What challenges are involved in responding to a solicitation?
Initially, the paperwork requirements may be frightening, but once you get into it and understand all the different sections, you get used to it and it’s not as hard. Certain parts of a solicitation never change. For instance, you have to declare your socio-economic certifications, whether you’re woman-owned, minority, service-disabled veteran, in a HUB zone, all of the above. Those are blocks that you check, and some of it is automated and online, so a contracting officer can look up that information or you can submit it with your proposal.
The biggest challenge is responding to the technical piece, normally in Section C – the Statement of Work. That’s where you have to really “answer the mail” – tell them how you’re going to go about doing the job, what processes are you going to put into place to make the system work, or how will you improve their processes or enhance their bottom line. Whatever they ask you to do or provide, do it. If you don’t provide the information requested, you may get kicked out of the running.
Q: Do you have a proposal writing team to handle that work? If so, do you recommend that approach?
We’re not large enough to have that kind of dedicated proposal writing team. Depending on the size of the contract, you can find people who make a living putting together proposals, but in my experience, it’s an expensive undertaking for a small business. As we’ve evolved, we’ve applied that concept internally. We may assign a proposal manager to be responsible for the proposal, to capture the data from different possible areas and then consolidate it into a document that everyone reviews and plays a part in preparing. Now that I have a dedicated person on the government side of the business, he’s helping to pull together proposals and he loves to do it, so that’s brought a lot of value as we’ve grown. And, there are some agencies, like SCORE through the Small Business Administration, that will provide support, but they don’t write the proposal for you. They can provide some guidelines, help direct you, but for the most part, you have to wing it. You learn from experience.
Q: Unless you win a contract, how do you know if your proposals are on-target?
One of the cool things with federal contracts is something I haven’t seen on the commercial side: Contract officers are required by law to give you a debrief, offering feedback on how you did. Some things they are not privy to tell you. But their assessment can help you do better in terms of improving the quality of your proposals and help you better prepare for the next one.
Q: How difficult is to obtain security clearance for contracts that have security requirements?
The Federal Acquisition Regulation (FAR) requires a DD Form 254 to be incorporated in every classified contract. It specifies the security requirements and the classification guidance necessary for the contractor (or a subcontractor) to perform on a classified contract.
So, under the contract, the contractor has to roll down a DD Form 254, and you can submit credentials for your clearance if you don’t already have a facility clearance or the appropriate clearance for that contract. What I’m finding now – unlike before – is that a lot of government agencies will want you to already have a clearance. You can get it as a subcontractor, if you come under a prime contractor who can roll down the DD 254 requirements, and you can start the process to get the clearance. But, if you don’t have a contract, you’re not going to get the clearance.