Breaking into the federal marketplace is no small feat. While many entrepreneurs and business leaders set out to become government contractors, most underestimate the complexity and competitiveness of the process. Between navigating registrations, writing proposals, and understanding and adhering to compliance, it’s easy to make critical mistakes that stall your progress before you ever win your first contract.

The good news? 

These mistakes are both common and avoidable. Whether you’re starting your journey or you’ve already taken a few early steps, understanding where most companies go wrong can save you months of wasted effort and put you on a faster track to success.

In this article, we’ll break down the top 10 mistakes startups make when trying to become government contractors. From overlooked registration errors to strategic missteps that cost you valuable opportunities, we’ll help you recognize and sidestep the pitfalls so you can compete with confidence.

The 10 Mistakes Startups Make When Trying to Become a Government Contractor

To kick things off, here are the 10 mistakes that startups consistently make:

  1. Skipping the strategic research phase
  2. Registering incorrectly in SAM.gov
  3. Ignoring DSBS and Capabilities Narrative
  4. Chasing every opportunity
  5. Using generic or poorly written proposals
  6. Failing to build relationships before bidding
  7. Misunderstanding compliance requirements
  8. Not differentiating from competitors
  9. Underestimating the time and resources needed
  10. Giving up too soon after an initial loss

Let’s check out each of these in more detail.

Skipping the Strategic Research Phase

One of the biggest mistakes we see from startups, especially those new to government contracting, is jumping straight in without doing the necessary foundational research. It can be tempting to start pursuing opportunities immediately. However, without a clear understanding of how government agencies purchase, from whom they buy, and what they truly need, you’re setting yourself up for frustration and missed opportunities.

Before you spend time on registrations or RFPs, your first step should be mapping out the competitive landscape. This mapping involves understanding the basic government contractor requirements, but more importantly, knowing how to align your capabilities with real demand.

Here are a few key areas to research:

  • Target agencies: Which departments or branches purchase what you offer?
  • Contract types: Are you best suited for simplified acquisitions, GSA schedules, or set-aside contracts?
  • Buying cycles: When do your target agencies release solicitations? What’s the typical procurement timeline?
  • Competitor positioning: Who else is selling into these agencies, and what makes them successful?

Skipping this research doesn’t just lead to wasted time; it can also result in mismatched bids, overlooked opportunities, and proposals that fail to impress before review.

Registering Incorrectly In SAM.gov

For most companies, the first step to becoming a government contractor is registering in SAM.gov. But this seemingly straightforward process is where many businesses go wrong. A single error, like a mismatched business name or the wrong NAICS code, can delay your eligibility or even result in full rejection.

SAM.gov registration errors are more common than you’d think. 

Some of the most frequent issues we see include:

  • A Unique Entity ID (UEI) that doesn’t match your legal business name or IRS records
  • NAICS codes that don’t accurately reflect your offerings or align with the contracts you want to pursue
  • Outdated contact or address information, which can block communication with contracting officers
  • Skipping important designations like small business or disadvantaged status

The key to success is double-checking every field for accuracy and ensuring your SAM.gov profile is consistent with other government databases. If your registration doesn’t match your DSBS profile or tax records, it can trigger red flags and slow down your progress. 

Taking time to get this right from the outset puts you on solid ground and ensures agencies can find and consider your business.

Ignoring DSBS and the Capabilities Narrative

Once your SAM.gov registration is complete, you’re automatically listed in the Dynamic Small Business Search (DSBS) system, but that doesn’t mean your profile is doing any heavy lifting. Many businesses overlook this step entirely, assuming registration alone is enough. But if your DSBS profile is incomplete or your capabilities narrative is too vague, you’re practically invisible to the people you’re trying to reach. 

DSBS profile mistakes are one of the most overlooked barriers to winning federal work. Contracting officers and agency small business specialists use this database to identify potential vendors well in advance of an opportunity going public. If your profile doesn’t clearly explain what you do, who you serve, and what sets you apart, they’ll simply move on.

When you’re learning how to register for government contracts, remember this: 

Your DSBS narrative is your ‘first pitch.’

Make it specific, keyword-rich, and tailored to the kinds of contracts you’re targeting. A strong capabilities narrative helps agencies understand how your solutions align with their needs, increasing your chances of being contracted for sole source or set-aside opportunities.

Chasing Every Opportunity

When it comes to first-time government contracting, enthusiasm often gives way to overreach. Many new vendors believe responding to every open RFP increases their chances of winning. But in reality, chasing every opportunity is one of the fastest ways to burn out your team and damage your win rate.

The government contracting process is resource-intensive. 

Crafting a competitive proposal requires thorough research, strategic planning, compliance checks, and tailored messaging. If you spread your efforts too thin across too many bids (especially those that don’t align with your strengths), you’re likely submitting weaker proposals that fail to resonate with evaluators.

Instead, shift from a ‘volume mindset’ to a ‘focus mindset.’ Identify the agencies and contract types that align closely with your capabilities. Take the time to understand the requirements of each opportunity you pursue thoroughly. A targeted, well-researched proposal will always outperform a generic one, and focusing your energy in the right places is how you build long-term success in government contracting.

Using Generic or Poorly Written Proposals

One of the most common and costly mistakes in government proposal submissions is relying on generic, copy-paste responses to calls for proposals. Many startups reuse the same boilerplate language across multiple bids, hoping that a ‘one-size-fits-all’ approach will be sufficient. It isn’t. Contracting officers can immediately spot a proposal that is too generic and lacks specificity, and they quickly move on from these.

If you want to stand out in a crowded field, you must tailor every submission to the agency’s specific needs and the scope of work that’s outlined in the solicitation. This tailoring means demonstrating a clear understanding of the problem, offering a solution that aligns with the agency’s mission, and supporting it with relevant past performance. 

Learning how to win a government contract means mastering the art of proposal storytelling. It’s not just about compliance, it’s also about persuasion. Take the time to research the agency, speak their language, and connect your capabilities directly to their objectives. 

A focused, well-crafted proposal doesn’t just check the boxes; it builds trust and confidence in your ability to deliver.

Failing to Build Relationships Before Bidding

One of the most common government contracting pitfalls is treating the bidding process like a cold sales pitch. Many businesses spend hours crafting proposals for agencies they’ve never spoken to, hoping their submission alone will somehow carry them across the finish line. But in government contracting, relationships matter more than you may realize.

Cold bidding rarely yields results. Contracting officers are risk-averse by nature. They prefer to work with vendors they know, have heard of, or who have been referred to them by trusted peers. If you’re a name on a proposal with no prior engagement, you’re starting at a disadvantage regardless of how strong your offer may be.

The more strategic approach is to start building relationships with government contracting officers well before submitting your first bid. Attend agency outreach events, set up capability briefings, connect with small business specialists, and follow up consistently. 

Establishing familiarity builds trust, and that trust increases the likelihood that when your proposal does land on someone’s desk, it’s taken seriously.

Misunderstanding Compliance Requirements

Another costly error, especially for new entrants, is underestimating the complexity of federal compliance. Compliance mistakes in government contracting can quietly derail even the most competitive proposals, leading to disqualifications, contract cancellations, or reputational damage that is difficult to recover from.

From the outset, your business must understand that government contracts entail unique obligations.

These often include, but are not limited to:

Failing to meet these requirements, either intentionally or not, can disqualify you from consideration or prevent future awards. To succeed long term, you must treat compliance as a core capability, not an afterthought. Before you bid, understand what’s required for the type of work you’re pursuing and build your team and systems to deliver on every front. 

Not Differentiating From Competitors

Standing out in a sea of vendors is no easy feat, especially when your offering looks and sounds like everyone else’s. One of the most overlooked government contractor tips is the importance of clearly articulating what makes your business different. If your proposal could be copied and pasted into another company’s submission with no changes, that’s a red flag.

For beginner government contractors, it’s critical to develop a sharp, focused value proposition that aligns directly with the mission and objectives of the agency you’re targeting. What do you do better, faster, or more efficiently than the competition? How does your past performance or innovation reduce risk for the buyer?

Your differentiation isn’t just about features or pricing, it’s about relevance. Demonstrate to the agency how your solution aligns with their priorities, addresses a specific problem, or assists them in meeting compliance or performance objectives. The clearer and more compelling your positioning, the easier it is for a contracting officer to justify selecting you over a more familiar name.

Underestimating the Time and Resources Needed

One of the biggest misconceptions about government contracting is that it’s a fast track to new revenue. In reality, it’s a long game that requires patience, persistence, and effective resource allocation. Many companies underestimate the time and internal bandwidth needed to compete effectively, especially in the early stages.

From navigating registrations and compliance to researching opportunities and writing tailored proposals, each step in the process takes more time than most businesses expect. And even when you submit a strong bid, it may take months before the agency announces awards, if you’re selected at all. 

Success in this space doesn’t happen by accident. It occurs when companies invest in dedicated resources, establish repeatable internal processes, and treat contracting as a long-term growth channel. If you’re serious about winning federal work, you need a plan. Not just to bid, but to build the operational infrastructure that supports ongoing pursuit, delivery, and compliance.

Giving Up Too Soon After an Initial Loss

It’s not uncommon for first-time contractors to lose their first bid and then walk away from the space entirely. But expecting to win a contract right out of the gate sets the wrong expectations. Government contracting is competitive and nuanced, and rejection doesn’t mean you’re not a fit. It often just means you’re still learning the ropes.

The most successful government contractors view early losses as part of the process. They request debriefs, analyze where their proposals fell short, and apply those lessons to future bids. Every submission, whether a win or a loss, offers you valuable insight into what agencies prioritize and how to improve your positioning.

The truth is, most companies don’t fail in government contracting because they’re unqualified. They fail because they give up too early. Stay the course, commit to consistent improvement, and treat every bid as a stepping stone to greater success. 

The opportunities are there; you just have to be willing to keep showing up. 

In Conclusion

Becoming a government contractor is absolutely within your reach, but only if you approach it with the right mindset and a strategic plan. As this article highlights, the biggest obstacles aren’t just regulatory; they’re avoidable missteps that cost time, credibility, and momentum. 

By steering clear of these common mistakes, you put your business in a far stronger position to compete and win. From nailing your registrations and compliance requirements to building relationships and crafting tailored proposals, each step you take with intention brings you closer to your first contract, and then your next.

If you’re ready to pursue federal work but want to avoid these pitfalls, let’s talk. 

Schedule a discovery call with us today to audit your current readiness and build a smarter path forward. 

We’ll help you clarify your strengths, focus your efforts, and confidently enter the government space with full confidence.