RE: How to become a "Contractor" not a "Sub-Contractor"

[Finley Marsha <Finley -dot- Marsha -at- PBGC -dot- GOV>]

Andrew et al:

It's Sunday evening, and I'm at work writing some subcontracts... Yes,
Andrew, the first few years can be a bit scary!  I've certainly agreed with
99% of what you've said...My business is a sole proprietorship, and I plan
to change to full "C" Corp next year.  Negotiation with a gov agency as a
proprietorship was a challenge - they were not familiar with the
differences, so they had some unrealistic expectations!

I responded to Dave direct, but thought it might be worth repeating...

I recently signed a 'prime' contract with a gov agency.  I had worked as a
sub-contractor for 2 yrs, when the agency decided not to renew the contract
with the prime for which I worked.  They approached me and asked if I'd like
a sole-source contract...  We went through thy bid & negotiation process May
- July & I signed on 1 Aug.

That was the process  Here are the caveats:  If you want a contract with a
gov agency, be prepared for it.  You must have a complete set of books by
which you can justify your rates ('because I WANT it' doesn't work...).  If
you are still an individual, immediately become a company (even a
sole-proprietorship) and establish both an identity and a financial profile
as a company.  

No one keeps all the money.  Self-employed people pay an extra tax that
employees don't. Overhead in this business is high - I just bought new
computers, so I know!  Your overhead (general & administrative) will be much
large than you will first plan.

Bottom Line:  Do  a great job.  Look  out for your client.   Keep yourself
technically proficient. Invest in your own training.  Be a bargain.  They'll
recognize it, eventually.

Marsha S. Finley                             202 326-4100 x 3910
"That'll do, Pig. That'll do." Farmer Hoggett in Babe

			


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